KENYA Law and Practice Contributed by: Anne Kinyanjui and Loice Erambo, DLA Piper Africa, Kenya (IKM)
6.13 Tenant’s Ability to Alter and Improve Real Estate Section 67 (2) (e) of the LA restricts tenants from developing the leased premises beyond what is permitted in the lease. The landlord’s consent would be required for restricted developments, and is granted on the following conditions: • the tenant complies with the applicable laws, including obtaining all development approv - als; • the tenant engages the relevant qualified pro - fessionals, such as architects; and • the tenant restores the leased premises to its original state (subject to reasonable wear and tear) at the expiry of the lease (unless other - wise agreed). 6.14 Specific Regulations The LA applies to all leases, whether residential, industrial or commercial. The following catego - ries of leases are governed by specific laws. Controlled Tenancies Under the LTA The LTA regulates controlled tenancies (see 6.3 Regulation of Rents or Lease Terms ) over busi - ness premises to protect tenants from exploita - tion, including arbitrary rent revisions and illegal evictions. Leases of Dwelling Houses Under the Rent Restriction Act (Rent Act) The Rent Act regulates tenancies relating to dwelling houses of a standard rent of below KES2,500, to protect tenants from exploitation by landlords. Leases Over Agricultural Land The LCA regulates dealings in agricultural land, with the aim of advancing agricultural activities and restricting ownership by foreigners.
There has been no legislation regulating leases during the COVID-19 pandemic period. 6.15 Effect of the Tenant’s Insolvency Under Section 73 (1) of the LA, the landlord has the right to terminate the lease if the tenant is declared bankrupt or goes into liquidation. 6.16 Forms of Security to Protect Against a Failure of the Tenant to Meet Its Obligations A landlord can ensure performance of the ten - ant’s obligations through holding a security deposit throughout the term of the lease, which will be forfeited in the event of default. Some landlords may also accept bank guarantees or parent company guarantees as security. 6.17 Right to Occupy After Termination or Expiry of a Lease The tenant has no right to occupy the leased premises upon the expiry of the commercial lease. The landlord should call for the yielding up of the premises by the tenant, and should issue eviction notices if necessary. Thereaf - ter, the landlord may evict the tenant; see 6.21 Forced Eviction . 6.18 Right to Assign a Leasehold Interest The lease would typically prohibit the assign - ment of the lease or permit assignment subject to the landlord’s consent. If permitted, a tenant may assign its rights over all or part of the leased premises on the following conditions: • the parties execute and stamp the deed of assignment; • the assignee is restricted from further assign - ing their rights under the lease; and • the tenant settles all obligations due to the landlord as at the date of assignment.
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