Leasing commercial property is a major commitment, and it’s essential to ensure that the lease agreement protects your business interests. Whether you're renting office space, a retail shop, or a warehouse, here’s a legal checklist to review before signing a commercial lease in Kenya.

1. Verify Property Ownership

Before committing to a lease, confirm that the landlord legally owns the property. Request to see a copy of the title deed and conduct a search at the Ministry of Lands to verify ownership and check for any encumbrances.

2. Confirm Zoning Regulations

Ensure that the property is zoned for your intended use. Certain areas have restrictions on commercial activities, and operating in a non-designated zone could lead to legal complications or business closure.

3. Understand Lease Duration and Renewal Terms

Review the lease period and renewal clauses. Check whether there’s an option to renew, pre-agreed rent escalation terms, and any conditions tied to lease extension.

4. Review Rent and Payment Terms

Clarify the rent amount, due dates, and acceptable payment methods. Ensure the lease states whether rent is inclusive or exclusive of VAT, service charges, and utilities. Additionally, negotiate a fair deposit and terms for its refund.

5. Examine Termination Clauses

Understand the conditions under which either party can terminate the lease. Check for penalties, notice periods, and any lock-in periods that could restrict early termination.

6. Assess Repair and Maintenance Responsibilities

Clearly define who is responsible for repairs, maintenance, and renovations. Some landlords require tenants to handle internal repairs, while structural maintenance remains their duty.

7. Understand Service Charges and Hidden Costs

If leasing in a commercial complex, check for additional charges like security, garbage collection, and common area maintenance fees. These should be detailed in the lease agreement to avoid unexpected expenses.

8. Check for Subletting and Assignment Rights

If you anticipate the need to share or sublease part of the space, confirm that the lease allows for subletting or lease assignment to another party.

9. Negotiate Exit Strategies

Ensure the lease includes provisions for exiting without excessive financial penalties. Look for clauses allowing you to break the lease under reasonable circumstances, such as business closure, relocation, or regulatory changes.

10. Seek Legal Advice

Before signing, consult a real estate lawyer to review the lease document. A legal expert can identify unfavorable terms and negotiate amendments to safeguard your interests.

Signing a commercial lease is a significant investment that requires careful evaluation. By following this checklist, you can protect your business from costly disputes and ensure that your lease agreement aligns with your business goals.

Looking for commercial properties to lease in Kenya? Browse verified listings on Makao Spaces and find the perfect space for your business.