Kenya's Ministry of Sports, Culture and the Arts will provide the National Olympic Committee of Kenya (NOCK) with the funds needed to prevent its under-construction headquarters from being auctioned.
Development of the headquarters began in 2014 under the previous NOCK leadership, but stalled three years ago due to a lack of funds.
Sidian Bank were the main financier of the building, providing KES 1.2 billion (£9 million/$12 million/€10 million).
NOCK had been expected to make up the rest of the cost, contributing KES 400 million (£3 million/$4 million/€3.5 million).
They were unable to pay this, however, and the building had been due to go up for auction.
NOCK officials have since met with Ministry of Sports, Culture and the Arts secretary Amina Mohammed and principal secretary Kirimi Kaberia, who have agreed to wipe the debt, as reported by Daily Nation.
They will do this through their Sports and Social Development Fund.
Certain conditions have to be fulfilled by NOCK and the other parties involved before the money is paid.
"We resolved to clear that debt because we are in agreement that the building is valuable and worth keeping," Kaberia told Daily Nation.
"We have however asked for certain details from everyone involved before we release money.
“We want the bank involved to give full disclosure of the amounts they have received so far from NOCK and the exact amounts that are outstanding.
“Also, we have asked for a report from the contractor to confirm the building is still sound and that construction can continue as earlier planned.
“From NOCK, we want them to tell us everything they know about the building so that we are sure about the building’s ownership, if there are any legal issues pending or if there is any case of continued responsibility.”
The building, named NOCK Plaza, is located in Upper Hill in Kenya's capital of Nairobi.
NOCK is also dealing with a corruption scandal, with the trial of six officials accused of corruption and mismanagement of their Rio 2016 team ongoing.