Sectional Properties in Kenya: The Sectional Properties Act 2020 Explained

Apartments, maisonettes, office blocks and townhouse developments are governed by one statute: the Sectional Properties Act (Cap. 286), enacted as Act No. 21 of 2020. If you are buying a unit or structuring a multi-unit project, understanding sectional properties Kenya law before money changes hands protects you from the most common title and management problems. This guide covers the framework, registration, the management corporation, conversion of older leases and the checks a buyer should run.

What Is a Sectional Property?

A sectional property exists where a building is divided into units that are owned separately, while the rest of the parcel is common property held by all unit owners. Section 3 defines a unit as a space within a building, described in a sectional plan by reference to floors, walls and ceilings, and includes its proportionate share in the common property. Under section 6(2), owners hold the common property as tenants in common in shares proportional to their unit factors.

The Act received assent on 11 December 2020 and commenced on 28 December 2020. Under section 2 it applies only to freehold land, or to leasehold land where the unexpired term is not less than twenty-one years and there is an intention to confer ownership.

Sectional Properties Kenya: How a Sectional Plan Is Registered

The process runs through the following steps.

1. Plan preparation. Under section 4, a surveyor prepares the sectional plan from a building plan approved by the county government, and cannot do so without proof of ownership of the parcel. The plan must describe at least two units.

2. Plan requirements and endorsements. Section 9 requires the plan to be geo-referenced, to show each unit and its approximate floor area, and to carry a schedule of unit factors. Under section 11, it must also carry a surveyor’s endorsement and a county government certificate that the division of the structure has been approved. The county must issue that endorsement within thirty days if the structure conformed to the applicable planning scheme and building permit.

3. Lodging. The plan is lodged with an application for registration by the corporation and a list of unit owners (section 4(3)).

4. Registration. Under section 5, the Registrar closes the register of the parent parcel, opens a separate register for each unit and, on payment of the prescribed fee, issues a certificate of title (freehold) or certificate of lease (leasehold) for each unit, showing its share of the common property. Interests noted on the parent register are endorsed on each new register.

The detailed forms and procedures are in the Sectional Properties Regulations, 2021 (Legal Notice 236 of 2021).

The Management Corporation

On registration of the plan, section 17 constitutes a Corporation named “The Owners, Sectional Plan No. …”, made up of all unit owners, with perpetual succession and a common seal. It can sue and be sued in its corporate name (section 18). Its duties under section 20 include insuring the buildings, keeping the common property in good repair and raising contributions from owners in proportion to unit entitlement.

A developer who registers a plan must convene a meeting at which a board is elected, within ninety days of fifty percent of units being sold or one hundred and eighty days of the first sale, whichever is sooner (section 27). The owner of the land at registration must hand over warranties, drawings and permits to the Corporation within one hundred and eighty days (section 37). Voting rights follow the unit factor (section 24).

Converting Older Sub-Leases

Many apartment blocks built before 2020 were sold under long-term sub-leases. Section 13(2) required those sub-leases, where intended to confer ownership of an apartment, flat, maisonette, townhouse or office, to be reviewed to conform to section 54(5) of the Land Registration Act within two years of commencement, that is by 28 December 2022. A developer, a management company or an owner may initiate conversion (section 13(4)).

Two protections matter in practice. An owner who already paid stamp duty on the sub-lease does not pay it again during the revision (section 13(3)). And if the developer will not or cannot surrender the parent title, the Registrar must dispense with its production (section 13(5)). Where a proprietor or developer fails to comply, the Registrar must register a restriction against the parent title to prevent further dealings (section 13(6)). That is why a buyer’s advocate must confirm conversion is complete.

Tenanted Premises

Under section 13(1), where a building contains premises rented to a tenant who is not party to a purchase agreement and which are not included in a sectional plan, the owner must not sell them as a residential or commercial unit until the plan including them is registered.

Service Charges, Information and Disputes

Contributions levied under section 20(2) are recoverable by the Corporation as a debt. Section 31(2) makes the owner when the resolution was passed and the owner when the action is brought jointly and severally liable. The Corporation may also register a caution against a unit for unpaid contributions, which gives it a charge equal to the arrears (section 31(4) and (5)). A buyer should therefore ask the Corporation for a certificate under section 31(3), which is conclusive proof of the amounts it certifies.

Under section 36, the Corporation must supply on written request, within twenty days, items such as a statement of contributions due, the by-laws, the budget and meeting minutes. A Committee hearing a complaint over non-compliance may award a penalty against the institutional manager of up to five hundred shillings per day beyond the twenty days.

The Corporation may constitute an Internal Dispute Resolution Committee (section 20(6)). By-law disputes may be referred to it under section 30, and a dissatisfied party may appeal to the Environment and Land Court, which is the “Court” under section 3. Sectional status ends only by unanimous resolution, substantial or total damage to the building, or compulsory acquisition (section 47).

What Buyers Should Check

• That the sectional plan is registered, not merely approved or pending.
• The unit’s own certificate of title or lease, separate from the parent title.
• That any pre-2020 sub-lease structure has been converted and no section 13(6) restriction is registered.
• The by-laws, budget, service charge position and a section 31(3) certificate.
• Charges and restrictions carried over from the parent register.
• For off-plan purchases, that the developer has delivered the documents section 43 requires: the purchase agreement, by-laws, title and the proposed sectional plan.

Frequently asked questions

This article is general information on Kenyan law as at its publication date, not legal advice. Reading it does not create an advocate and client relationship.