Fusion Capital has offered tenants of its Flamingo Towers property located in Nairobi’s Upper Hill area, a 30 percent discount on rent to reduce pressure from the current economic distress.
Tenants in the 18-floor prime office tower will pay the reduced rents for a four-month period beginning April 1.
“The board continues to monitor the situation and will advise by the end of the quarter whether the discounted rate shall be enforced further, or the way forward if the country will have resumed normalcy,” management said in a statement on Monday.
The firm’s executive director, Samuel Kimotho, said the developer has announced the measures in recognition of the global economic meltdown which has also affected local businesses.
“We very much see our leases with our tenants as mutually beneficial partnerships,” he said, “We, as the board of Flamingo Tower Limited, hope that the discount on the rent will offer some relief to our partners during these uncertain times.”
Fusion Capital CEO Daniel Kamau said most retail and office occupiers are SMEs who have been hit hardest by the crisis. He urged other landlords to introduce such incentives that may extend the lifespan of SMEs beyond the crisis.
“It is in the landlord’s interest that these businesses continue surviving and so sharing of rent risk will be important,” said Kamau.
Mr. Kamau said rent concessions would be a win-win as this will ensure business continuity for both tenants and landlords.
According to the Star, the executive also urged tenants to appreciate the cost factor for landlords who have to pay utilities, building maintenance, security, staff and mortgages, before demanding a 100 percent waiver on rent.
While addressing the nation on Monday, the President encouraged landlords and service providers who have put in place incentives to reduce the burden for fellow Kenyans under the prevailing economic environment.