Nairobi’s construction sector is facing a steep decline, with the value of building approvals plummeting to Ksh 8.6 billion from January to March 2025, the lowest in nearly two years. This marks a staggering 60.1 per cent drop from the Ksh 21.4 billion recorded in December 2024, as reported by the Kenya National Bureau of Statistics (KNBS).
Experts attribute the decline to a complex mix of low demand, cumbersome approval processes, and uncertainty surrounding the county’s new zoning regulations. The Architectural Association of Kenya (AAK) has voiced concerns over unclear guidelines, citing delays in approvals that have stretched beyond a year. “Delayed approvals of over a year have resulted in losses, as projects cannot commence on time,” the association lamented.
The downturn in approvals has been evident since May 2023, signalling a sustained contraction in the sector. Industry analysts believe the decline is largely driven by investor caution over the proposed zoning policy, which could see buildings in Nairobi’s central business district, Upper Hill, and other commercial areas rise as high as 75 floors. However, lingering uncertainty over the policy’s implementation continues to hold investors back.
In a bid to reverse the trend, Nairobi Governor Johnson Sakaja recently announced a bold move to reduce the approval timeline from six months to a mere two weeks. During a meeting with the Kenya Property Developers Association (KPDA), Sakaja directed that all building approvals be completed within 14 days. “By reducing the approval timeline, developers can now expect a more predictable and efficient process, enabling better planning and execution of projects,” he stated.
This move comes in response to frustrations over bureaucratic red tape that previously forced developers to endure protracted wait times, escalating costs, and, in some cases, resort to informal methods to expedite approvals, often leading to unsafe and non-compliant structures.
Despite the streamlined process, developers remain cautious. Uncertainty surrounding the zoning policy persists, and many are wary of committing to new projects until clearer guidelines are established. Without decisive action, the construction sector could continue to face headwinds, leaving Nairobi’s skyline in limbo.
