Ministry misses deadline on lower public offices lease rates

The Ministry of Housing has missed its deadline for setting new rent rates for government officials.

In his budget speech, suspended Finance Cabinet Secretary Henry Rotich announced that from July the government would renegotiate leases and set a standard rate to be applied across ministries, departments and agencies

“The government has been leasing office space at higher than market rates resulting in huge costs. Beginning 1st July 2019, all procurement of office accommodation by government will be standardised,” CS Rotich said.

Housing ministry was supposed to spearhead the exercise. But two months later the rates are yet to be set and industry players say the government has not made any moves in the market.

“The rate has not been set,” said Charles Hinga PS Housing and Urban Development on Friday without further comment.

Realtors say the move could prove costly as ministries would have to pay for the rest of the tenancy period if Treasury terminates a lease contract. Leases are typically held for three to six years and the prices depend on the building, which makes it difficult for the government to negotiate flat rates.

Just as Treasury is talking austerity, the office of the Director of Public Prosecutions is seeking to lease a property with a swimming pool and gym within Nairobi’s five upmarket locations to house a prosecution training facility.

An impromptu property search shows such houses stand on half-acre plots with a six-bedroom house in Karen going for Sh280,000 a month while a four-bedroom house within Karen attracts Sh220,000 a month.