A group of hired youths descended on stalls in Woodley Ward in the wee hours of Wednesday morning as armed police offered them security.
The stalls, located between Mash Park and Harlequins Suites, are said to have been erected on a privately owned land.
The contested piece of land used to host a garage, M-Pesa shops and beauty parlours.
One of the garage owner Lucas Ochieng said that they estimate the loss to be around Sh900, 000.
One of the affected stall owners, Lucas Ochieng, claimed the hired youths numbering over 50 invaded the place at 3am and started destroying everything they came across.
The youths have since fenced off the land with iron sheets.
"This man (the developer), whom I have not seen face to face, has been sending his people to warn us to leave this place. The threats started in July and have been persistent ever since. But we don't know why he is claiming the land yet it is a road reserve and we have been here since 1996 when my father started operating this garage, " said Mr Ochieng.
He said that currently around 70 youths are now jobless after the demolition.
Governor Mike Sonko, who visited the scene, asked the affected traders to remain calm and put up their shops once again after the hired youths leave the place.
The area Ward Representative Mwangi Njehia condemned the act saying that it was inhumane to demolish the structures without issuing notice.