Financing your Large Capital Project

Financing Karen Estate
Macharia Waruingi, Doctor of Medicine and Doctor of Health Administration
Ustawi Biomedical Research Innovation and Industrial Centers of Africa [UBRICA]

By 1931, Baroness Karen von Blixen-Finecke, had realized that it was becoming impossible to carry on with her Ngong coffee farm. Karen’s banker sent the very young Jean Remi Martin from Europe to come to Kenya and arrange the sale of the property.

Karen Estate Limited is the Investment Program
Mr. Martin was attracted by the property. It had great potential. He thought right away what he could do to acquire it. He had no money of his own. He needed 4,000 pound sterling to purchase the property. His head started working. He thought he could convert the land into a high-end residential estate. But who would want to have residence at such a remote place. At that time the area which was deemed to be part of Ngong, was completely new and unknown to most. It was also regarded as being remote and in the rainy season it was essential for all vehicles to carry chains. To make it attractive he would propose to have a golf course.
In 1931, He formed Karen Estates Ltd, with him as Managing Director. He signed an agreement to acquire the property April 1, 1931. Then he invited thirty leading citizens to subscribe £150 each by way of a debenture bearing interest at 5% per annum. From this he raised 4,500 pounds. He paid 4,000 to Karen Blixen. He used the remaining 500 pounds to construct a 9-hole golf course.

Karen Country Club is the Exit Strategy
Next, Karen Estates Limited formed a Member-owned organization known as Karen Country Club. The Karen Estates Limited offered the Club 20 acres as an outright gift, and to lease the golf course area for 35 years beginning March 31, 1937 at a rental of KSh 100/= per month, with an undertaking to provide a free supply of water to the greens. The Club was incorporated on May 19, 1937 as a company limited by guarantee.

Karen Estates Limited conferred the 30 debenture takers life membership. They became the founder Members of the Club. On July 2, 1937 the 30 debenture holders appointed other 15 members of their families without entrance fee. In addition, they brought in another 131 at an entrance fee of KSh 50/= for men and KSh 30/= for women. The 131 were the first members of the club. The newly-formed club took over the liability for completion of the building the all-in cost of £4,075 worked out at Ksh9/= per square foot.
The golf course opened officially on 23 October 1937. In 1938, the club raised its entrance fees to Ksh 100/= for gentlemen and Ksh 60/= for ladies; annual subs were set at Ksh 120/= and Ksh 90/= respectively. In 1945 the men`s entrance fee was doubled, while the first substantial increase - 50% - in subs did not come until 1948.

Today the Club is a family oriented country club with over 4000 members, 800 being golf members. The club has a range of amenities to cater to children, young adults, adults and seniors.