Property Title and Property Valuation

These new highly leveraged investors are prepared to enter the market on high loan to value ratios, pushing prices higher and providing even greater competition for our domestic superannuation funds, he says. With the concept of ownership deeply ingrained in the Kenyan psyche, a disproportionate amount of the country’s wealth is tied up in property.

Whilst this creates a substantial investment trading market and also means that institutional portfolios contain a spread of assets across different centers and sectors, the fact that most assets are concentrated within Kenya leaves the institutions with vulnerable risk- return horizons. Portfolio diversification and spread of risk outside Kenya are thus two issues currently facing the market, although the Insurance Act does not permit the investment of Insurance Funds outside Keyna. Our licensed valuers are capable and talented enough to tackle their clients process.

With exchange controls now removed, an increase in foreign investment, particularly in Uganda and Tanzania, is both expected and necessary. In spite of a large institutional market, the property sector has, on occasion, suffered from lack of liquidity. Most developers and institutions operate on the basis of developing in order to retain assets for their ongoing income flow rather than developing to trade and realize capital profit.

Commercial leases are typically for six years with rent reviews every two years. Reviews can be either to open market or via pre-agreed escalation rates contained in the original lease. The latter approach tends to prevail, but the length and structure of leases are tailored to avoid out dated rent restriction legislation that militates very strongly against landlords. Building quality and specification vary dramatically. Overall, the market lacks prime, well specified accommodation.

A considerable proportion of the leasing market comprises occupiers upgrading their premises. The turnover of space is thus relatively high with new, additional demand related to the economic cycle. Air conditioning is not standard and very few buildings offer this facility in what is a very benign climate. Air conditioning is not standard and very few buildings offer this facility in what is a very benign climate.