Projects delivered under Joint ventures in Kenya.

Prism Towers, Upper hill.


Flamingo towers, Upper Hill


4th Ngong Towers.

Factors leading to the need for real estate joint ventures.


Exorbitant land prices especially in urban areas.

With land prices going higher and higher, its easier for Real Estate developers to team up with land owners hence save the cash that could have been injected in purchasing the land and use it to build even larger plinth area of space for both parties to benefit.

Unsteady and high interest rates on loans making real estate a high risk investment.

High interest rates have discouraged land owners from accessing finance to develop on their own, hence the need for land owners to seek out financiers who already have the finance ready.

Strict Mortgage terms.

Bank requirements for land owners to put in between 20 to 30% as their contribution for them to access loans of the rest of the 60 to 80% of construction loans make it harder for land owners to access bank loans.


Inefficient County government approval systems.

Comparing Kigali city building approval system vs Nairobi city, the Kigali city process encourages high rise developments, as in if the proposal is several storeys high, this is more encouraged. This is the opposite with Nairobi City, where the bye laws set for few number of floors while the demand out there is for many floors, opening up situations of corruption where the developers have to part with bribes so as to be allowed to build higher, which makes business sense to them. This requires that land owners team up with experienced developers who know their way around so as to maximize their land use development.


Expertise in running property projects, and general management of investment.


Joint venture projects help land owners to easily tap in to real estate expertise and processes.


Diversify and reduce property investment risks in Kenya.

Joint venture projects help to reduce the investment risks by sharing the costs , expertise and experiences between land owner and financier.

Appropriate and sustainable form of real estate source of finance in Kenya.

Joint venture in real estate is currently the way to go for land owners based on the high interest rates that make it hard for land owners to access capital. With the new constitution that is vibrant and easy to plug in to new contract agreements, the Kenyan legal process can now accommodate and help secure investments that are based on joint venture agreements.


Key success factors of joint ventures in real estate sector.


Good management of the joint venture

The joint venture agreement will need to be structured well. The best joint venture agreement structure is where there are the land owner, financier and a 3rd partner, the project manager, with a slight shareholding, between 1 to 4% of the limited liability company that is developing. This 3rd minority shareholder enables the financier and land owners to tap into construction management easily, with the project manager, being part owner of the project, ensuring the success since he is also a beneficiary of the same.

Favorable legal framework and policy

The current Kenya constitution is well designed to handle joint venture agreements. The digitizing of records at the Registrar of Companies and Ministry of lands go a long way in enabling this type of real estate investment in Kenya.

Available financial market

In Kenya, Banks have started restructuring to allow for joint ventures, thereby encouraging more investment in this line. The international developers are also attracted by the stable political leadership and enhanced rule of law and judicial systems in Kenya.

Appropriate joint venture structure.

Joint venture agreement structuring should be done carefully where the calculations of profits are translated into percentages then incorporated in the Special Purpose Vehicle agreement.



 Kenyan economic, political, and social Conditions .


Kenya is currently one of the best run countries in terms of political and social conditions. This good political leadership has given international real estate financiers the confidence to set up in Nairobi. Real estate return on investment is very long terms , hence financiers look at the long term political situation of countries before they invest. Since 2013, Kenya and especially Nairobi is witnessing the largest real estate investment ever seen in Africa, with cranes doting the Nairobi Skyline everywhere. Most of these are internationally funded.


Success rate of joint ventures in Kenya.

Joint venture projects in Kenya where the land owners carefully vet the financiers are 100% successful. There are several instances where the land owners have completely lost to investors. In our documentation of joint venture projects, we have carefully studied both the successful and failed projects and can advise land owners on how to check if their financiers are in a position to deliver.


Architect Francis Gichuhi Kamau.

Arch. Francis Gichuhi Kamau. (337 Posts)

Architect Francis Gichuhi . B.Arch. University of Nairobi. Registered Architect, Kenya. Member, Architectural Association of Kenya. Contacts. email Telephone +254721410684


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