It also has a thriving hospitality industry with high class hotels and lodges, and a vibrant floriculture economy.
For the past four years, the World Rally Championship (WRC) Safari Rally has been a major centre of attraction for Kenyan fans and their counterparts from neighbouring countries who have been flocking to Naivasha in large numbers to watch the thrilling event.
After the Federation of International Automobiles Association (FIA) changed its rules for the event to be run in a closed circuit, Naivasha became the natural choice to host the event due to availability of large private ranches where the event could take place, in a secure environment.
During the four days that the international motoring event is held, there is a lot of merrymaking by mainly youthful rally fans who indulge in alcohol consumption, song and dance, casual sex and all forms of leisure and entertainment.
The National Syndemic Disease Control Council (NSDCCO) Chief Executive Officer, Ruth Masha, said they distributed 200,000 condoms at the just concluded rally in Naivasha.
Naivasha town, which is located on the shores of Lake Naivasha, a fresh water lake, and situated about 93km from Nairobi, owes its origin to the pre-colonial period when Maasai herdsmen inhabited the area.
The town's growth was accelerated by the passing of the Uganda railway through the area and subsequent settlement by British farmers.
According to author James Fox, Naivasha became famous due a group of white settlers that lived in Kenya's Happy Valley at Wanjohi, at the foot of Aberdare range between 1930s and 1940s.
Naivasha, however, remains the home of Keroche Brewery, the country's second largest beer manufacturer. After Kenya attained independence, Naivasha continued to play a dominant role in the economy due to commercial floriculture.
A former Kenya National Chamber of Commerce and Industry (KNCCI) world-wide good ambassador Mr Njuguna Kamau said Naivasha had over the years evolved into a holiday and conference destination due to its proximity to Nairobi.
Mr Kamau, who also served as KNCCI's Nakuru chapter chairman for four years, said there were over 40 major hotels around Naivasha, in addition to other small hotels and lodges and camping sites.
Mr Kamau said most people from Nairobi found it easy to travel to Naivasha for short holidays over the weekends due to the short distance.
"The area has a good climate, being not too cold nor too warm, making it ideal for weekend vacations," he said.
Kamau added that attractions such as Hell's Gate National Park which is accessible throughout the year, and Longonot Mountain, have contributed to the development of a vibrant tourism industry.
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A numbers of visitors from Nairobi visiting Lake Nakuru National Park, some 65km from Naivasha, have also been preferring to book hotels in Naivasha," Mr Kamau added.
Mr Kamau said the WRC Safari Rally organisers had identified Naivasha as the ideal venue for the event due to prevailing security and political stability.
"The presence of such huge ranches as Soysambu, Kedong and Marula offered an opportunity for the event as the large distance covered by rally cars was within a circuit area," Kamau said.
A former Naivasha mayor, Mr Samson Mwirigi, said that farming activities around Lake Naivasha had greatly contributed to the region's economy.
Mr Mwirigi added that availability of affordable land had made it possible for investors to establish high quality hotels and lodges within the vicinity of the lake.
He said Naivasha is a popular destination for youthful revelers from Nairobi during weekends due to short distance from the city.
The former mayor added that most expatriates working with various embassies and other international agencies based in Nairobi prefer spending weekends in various hotels and lodges within Naivasha, a short distance from Nairobi compared to Mombasa.
He said Naivasha has also been receiving many tourists heading to Maasai Mara Game Reserve due to its central location.
Mr Mwirigi said that the area was linked to Nairobi by two major roads.
He added that Naivasha area has a large number of private conservancies that provides camping sites for holidaymakers and tourists.
Nakuru Governor Susan Kihika recently said that Naivasha had positioned itself as a major holiday destination.
The governor said that the establishment of Special Economic Zone in Naivasha will further raise its profile and attract more business opportunities, which will further solidify as a destination of choice for holidaymakers.