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Occupancy of Nairobi's prime office space climbs on demand
Knight Frank Kenya CEO Mark Dunford addressing journalists during the Wealth Report 2025 – Kenyan 2nd Edition launch event at Capital Club in Nairobi on May 13, 2025.
Photo credit: Bonface Bogita | Nation Media Group
Occupancy levels in Nairobi’s prime offices jumped to 77.7 percent by the end of June from 72.7 percent at the beginning of the year, driven by strong uptake in recently completed units.
The prime category refers to Grade A offices that are in key business locations, feature high-quality contemporary designs, and are equipped with cutting-edge facilities.
A new report by real estate firm Knight Frank Kenya shows that despite rental prices remaining unchanged at $1.20 (Sh155) per square metre over the six months, growing demand from co-working space providers and business process outsourcing firms helped raise occupancy.
The first half of 2025 has now marginally surpassed the 77.2 percent occupancy levels seen in the first half of last year.
Uptake of new office space had suffered in recent years after the Covid-19 pandemic forced hundreds of firms into remote working plans, with some extending the arrangements beyond the pandemic after realising cost savings on rents and other office expenses.
Knight Frank Kenya now says developers are competing on the quality of office space, with properties that offer better amenities attracting higher occupancy in a market that still favours the tenant.
“The flight to quality is undeniable. Prime office spaces with ESG credentials and modern amenities continue to attract tenants, while secondary stock struggles. Landlords must prioritise adaptability to remain competitive in this tenant-favouring market,” said Mark Dunford, CEO of Knight Frank Kenya.
“The market continues to see robust activity from co-working operators and business process outsourcing (BPO) firms, attracted by operational efficiencies and trade advantages.”
The country has seen a steady rise in Grade A office supply since 2010, largely driven by Kenya’s status as the regional hub for international investors, diplomatic missions, and multinational corporations.
This demand has spurred the transformation of places like Upper Hill, Westlands, and Kilimani into commercial districts that draw businesses away from the traditional central business district, where the supply of top-grade office space remains limited.
On pricing, the asking rents have stagnated at $1.20 per square foot since at least 2023, partly as a legacy of the pandemic, and the tough economic conditions in the last three or four years that ate into demand for space.
These shocks forced a number of firms in Nairobi to shift to smaller, fitted-out office spaces as flexible working patterns became the new normal. This saw landlords grant concessions on lease renewals, which included cutting or freezing rents in a bid to attract and retain tenants.
