As per recent budget proposals, the Treasury is looking for more than Sh180 billion to lease new office spaces. This follows recent concerns about the government’s increased expenditure on rising rent costs.

Budget allocations for the current year 2025/2026 indicate that Sh79 million has been set aside for the purchase of more office space to ease congestion at the National Treasury Building.

Additionally, another Sh100 billion has been apportioned for extra office space to be used by the Financial Reporting Centre (FRC) to accommodate its growing workforce. Treasury noted there was a Sh3 million deficit in the yearly rent budget of the Institute of Certified Investment and Financial Analysts.

State officials defended the extra funding request before Members of Parliament, arguing these expenditures align with President Ruto’s Bottom-Up Economic Transformation Agenda.

“The National Treasury has acquired an additional office space to relieve congestion at the National Treasury Building. Process of signing a lease agreement is ongoing,” wrote Principal Secretary Chris Kiptoo in a report to the National Assembly.

In the past, the Treasury assured Kenyans that it would prioritize the purchasing/construction of office spaces rather than leasing out expensive rental units.

The FRC’s new office space has come at a timely moment as the organisation races against time to get Kenya off the financial grey list by updating its AML policies.

Renting office spaces has become a point of contention in Kenyan discourses, as the state continues establishing units in Nairobi’s most expensive business districts such as the CBD, Westlands, Upperhill and Kilimani.

“The government will consider a one-stop shop for all government agencies. The Public Administration and International Relations sector has prioritized the construction of offices over leasing, including for foreign missions,” the Treasury wrote in the draft 2025 Budget Policy Statement.

Currently, the government’s office rental expenses are nearly Sh6 billion, for both local and international units. This cost has steadily ballooned over time, majorly due to the Ministry of Foreign Affairs (MFA) seeking to lease residences and offices for Kenyan diplomats abroad.

Lately, MFA has chosen to purchase and construct properties rather than rely on expensive leases, a move aimed at cutting down on rental costs and attaining long-term savings.

For example, the government is finalizing the acquisition of chancery in London for Sh2.67 billion to avoid an annual lease of over Sh56 million (£350,000).

Kenya is also securing diplomatic properties in cities such as New Delhi (Sh2 billion), Stockholm (Sh1.6 billion), Geneva (Sh1.3 billion), Juba (Sh1.5 billion), Berlin (Sh1 billion), Kigali (Sh750 million), Bujumbura (Sh500 million), Mogadishu (Sh350 million) and Pretoria (Sh50 million).