Few office space takers as virus wreaks havoc

Perris Njambi, a partner at Durian Property, which leases and sells office and residential property in the city, has seen her fortunes tumble in the last four months.

She still finds it hard to believe the drastic change the industry has undergone in just a few months. Ms Njambi now goes to work just twice a week.

When Covid-19 struck, her clients, mostly expatriates, vanished into thin air.

What surprised her most was the speed with which many expatriates left the country while those who had already booked space postponed their agreements, leaving her with just a few clients.

As a result, she has been left with plenty of space to lease. 

“When this disease (Covid-19) was first announced in the country, I didn’t expect the ripple effect to come so fast. However, within a short time, a lot of my clients, many of them expats, left while those who were in the process of renting or buying with us postponed it,” Ms Njambi says.

Like many landlords and dealers in office space, Ms Njambi has suffered great loss. Working from home was one of the first measures taken to curb the spread of the coronavirus, as the teleconferencing app, Zoom, became the new boardroom for meetings.

 Three months later, as President Kenyatta gradually opens up the economy, some sectors will take a while to get back on their feet as health experts warn that living with the virus will be the new normal.

For many in the multi-billion-shilling real estate sector, business has been bad since people started working from home, with uptake of office space sluggish.

With many businesses struggling after sending staff home, some have scaled down operations to reduce rental cost by giving up space.

Others have closed shop, leaving Ms Njambi struggling to keep the company afloat.

 “Right now, people don’t have money. It’s a sad situation. We get some clients who come to inspect our properties, but do not have the money to buy or rent them,” she says.

For outright sales, it’s the suspension of services at the Lands ministry that is holding the sector back, Ms Njambi says. To initiate a land transaction, a land title search is paramount, but  cannot be carried out now.

Therefore, Ms Njambi is banking on strong client relations to woo them back when the situation normalises as she strategises on new ways of boosting sales. But she is also aware that from now, more people will take to working from home, which will greatly reduce the demand for office space. 

Meanwhile, some landlords have started seeing a marginal increase in sales and rentals in June. This comes as businesses start reopening, while some people who had been working from home have started going back to work.

Mr Zachariah Kinyua, a director at Stonegate Investments, is delighted that he’s seeing a slow return to normalcy, although business is still slow.

But he has observed a new development in his clients. Now his clients no longer target walk-in customers but rent space, stock it with goods and market their products online to target more people, who are becoming more comfortable with shopping online. That means they are using less space and operating more efficiently, he says.

“Clients have started trickling back slowly, compared to last month and April,” he says. 

“Most of the people who are coming back to take space have found a new way of conducting business. They have discovered that the future of commerce is online as digital literacy improves and gadgets become cheaper,” he adds.

After marketing their goods, Mr Kinyua’s clients can deliver them to customers or have them come for them. Apart from saving his clients operational costs, this trend is slowly increasing Mr Kinyua’s clientele base.

For Mr Harry Okinyi, a director at Homefront Consult, business couldn’t be worse. He is waiting for the economy to reopen before returning to full-time operation.

Central business district

For now, there are few clients renting or buying, with many of those still surviving struggling financially. He hopes the pandemic will be brought under control sooner than later so that he can resume business.

“There is not much going on currently in terms of sales as clients have drastically reduced. Our operations are currently moving sluggishly,” Mr Okinyi says.

Business in office space  sales and rentals in the central business district, he says, is doing better than in other areas due higher demand there.

However, Mr Okinyi longs for a return of the “good old days”, which is just a few months ago.