RENEWAL AND EXTENSION OF LEASEHOLD PROPERTIES IN KENYA

INTRODUCTION

In Kenya, land ownership is governed under two main land tenure systems:

1. Freehold Tenure, and
2. Leasehold Tenure.

1. Freehold Tenure

Freehold tenure refers to absolute ownership of land for an unlimited duration. Once land is acquired under this system, the owner has complete rights to the land and can pass it on to their heirs, sell it, or develop it as they please, subject to planning and zoning laws.

However, it is important to note that freehold ownership is restricted to Kenyan citizens.

• Foreign nationals, including foreign companies, are not allowed to hold freehold land in Kenya under the Constitution and the Land Control Act.
• This restriction is meant to protect Kenyan land from foreign control and ensure its availability for future generations.

2. Leasehold Tenure

Leasehold tenure refers to a system where land is owned by the government (national or county), and an individual or entity is granted the right to use the land for a specific period, usually 33, 50, 66, or 99 years, depending on the terms set out in the lease.

• The lessee (person granted the lease) is required to pay annual land rent to the government.
• At the expiry of the lease term, the land reverts to the lessor (usually the government) unless the lease is extended or renewed.
• For non-citizens, the maximum lease term allowed is 99 years, as per the Constitution of Kenya 2010.

 

RENEWAL OF EXPIRED LEASES

Renewal of a lease occurs after the original lease term has expired. This usually happens when the lessee fails to apply for an extension of the lease before its expiry.

• In such cases, the lessee must apply to renew the lease, which is treated as a new application, rather than a continuation of the previous lease.
• This process is not automatic and the government may impose new conditions, including:
• Change of land use,
• New valuation and rent assessment,
• Compliance with current planning and zoning regulations.

Key point: Failure to renew an expired lease in time could result in loss of legal interest in the property, and the government may allocate the land to another party.

 

EXTENSION OF LEASES (BEFORE EXPIRY)

This is the preferred and recommended process, where the lessee applies to extend the lease before it expires. This ensures continuity of ownership and avoids legal disputes or forfeiture of land rights.

Legal Framework

Under Section 13 of the Land Act, 2012, the National Land Commission (NLC) is required to:

1. Notify the registered lessee (owner) of the land at least five (5) years before the lease expires.
2. If the lessee does not respond within one (1) year, the NLC must:
• Publish the notice in two national newspapers,
• The lessee then has six (6) months from the date of publication to respond.

If the lessee still does not respond, the land may be treated as reverted public land and may be allocated to other individuals or entities.

Importance: Lessees are strongly advised to monitor their lease terms and initiate extensions early to avoid complications.

 

PROCESS FOR RENEWAL OR EXTENSION OF LEASES

This process involves multiple stakeholders including licensed professionals and government departments.

Step-by-Step Guide:

1. Engage a Licensed Physical Planner
• The lessee must hire a registered physical planner to prepare and submit planning documents.
• This includes requesting a Planning Brief and filling out PPA2 forms from the County Government where the land is located.
2. Submission of Planning Documents
• The Planning Brief and PPA2 forms (in triplicate) are submitted to the:
• Director of Land Administration (national government) or,
• County Land Administrator, depending on who owns the land.
3. Circulation of the Application
• The Land Administrator issues a circulation letter requesting input from:
• The Director of Physical Planning,
• The Director of Surveys,
• The County Physical Planner (in devolved units),
• These stakeholders review and provide comments or objections.
4. Letter of No Objection
• If no issues are raised, a Letter of No Objection is issued, signaling that the lease extension can proceed.
5. Provisional Approval
• The Director of Land Administration issues Provisional Approval for the extension or renewal of the lease, subject to final conditions being met.
6. Re-Survey of the Property
• A registered surveyor re-surveys the land to:
• Confirm boundaries,
• Update any changes,
• Generate a new Registry Index Map (RIM) for the parcel.
7. Re-Valuation of Land
• The government valuer conducts a valuation to determine:
• The current market value of the land,
• The new annual rent payable,
• Any premiums due to change in land use or location.
8. Final Approval
• After the re-survey and valuation, the Director of Land Administration issues the Final Approval for the lease extension.
9. Preparation of Legal Documents
• A licensed advocate prepares:
• The Surrender document (to relinquish the old lease),
• A new Lease Agreement for the extended term.
10. Issuance of New Title

• Upon registration, a new Leasehold Title Deed or Lease Instrument is issued, reflecting the new term and updated conditions.

 

CONCLUSION

The renewal and extension of leasehold titles in Kenya is a structured process that involves compliance with planning, survey, and legal requirements. Property owners should:

• Track their lease expiry dates,
• Initiate extension applications at least five years before expiry,
• Ensure compliance with all land use and planning regulations.

Engaging qualified professionals such as physical planners, land surveyors, valuers, and advocates is essential to ensure a smooth and successful process.

 

DISCLAIMER

This article is intended for general informational purposes only and does not constitute legal advice. Property owners are encouraged to seek guidance from qualified land law professionals.