NAIROBI, Kenya – The National Treasury is seeking over Sh180 million in the 2025-26 financial year to lease additional office space, even as concerns grow over the soaring cost of renting government premises.
Budgetary documents reveal that Sh79 million is earmarked to ease congestion at the National Treasury Building, while the Financial Reporting Centre (FRC) requires Sh100 million to accommodate more staff.
Additionally, the Institute of Certified Investment and Financial Analysts is facing a Sh3 million rent shortfall.
Treasury officials argue that the increased leasing costs align with priority expenditures under the Bottom-Up Economic Transformation Agenda.
“The National Treasury has acquired an additional office space to relieve congestion at the National Treasury Building. The process of signing a lease agreement is ongoing,” Treasury Principal Secretary Chris Kiptoo wrote in a report to Parliament.
The FRC also confirmed that it has expanded its office space, necessitating an extra Sh100 million in rental costs.
The agency is working to update Kenya’s anti-money laundering and counter-terrorism financing policies ahead of a critical June deadline, in a bid to remove the country from the Financial Action Task Force (FATF) grey list.
The move to lease more office space comes despite repeated government pledges to reduce reliance on rentals by constructing or purchasing offices.
The Treasury has previously stated that office rental costs place a significant burden on taxpayers, with the government spending nearly Sh6 billion annually on rented premises.
Most government offices are located in prime areas such as Nairobi’s central business district, Westlands, Upper Hill, and Kilimani—locations the Housing ministry deems ideal for state operations.
However, as rental costs continue to rise, there is increasing pressure to shift towards ownership.
Treasury documents indicate that a long-term plan to develop a “one-stop shop for all government agencies” is under consideration.
“The Public Administration and International Relations sector has prioritised the construction of offices as opposed to leasing, including foreign missions,” reads the draft 2025 Budget Policy Statement.
The government has been gradually moving toward purchasing property to cut long-term costs.
The Foreign Affairs ministry, which bears the highest expenditure on leased premises, has been at the forefront of this strategy.
Kenya is finalising the acquisition of a chancery in London for Sh2.67 billion to replace a lease that currently costs approximately Sh56 million annually.
Similar purchases are planned in New Delhi (Sh2 billion), Stockholm (Sh1.6 billion), Geneva (Sh1.3 billion), and Juba (Sh1.5 billion).
While these acquisitions require substantial upfront investment, officials argue they will reduce long-term rental expenses and enhance Kenya’s diplomatic presence abroad.
