Denis Gardens, Kilimani: the building where the nightly rate wins at 31 percent occupancy

Denis Gardens publishes something most Nairobi buildings do not: a monthly rent and a nightly rate for every single layout. Put the two beside each other for a two bedroom and you get KES 65,000 a month against KES 7,000 a night. Nine nights pays the month. That is the most favourable ratio we have found in this city.

What the building actually is

A completed high rise on Denis Pritt Road in Kilimani, one of the established residential streets in that part of Nairobi, ready for occupation. Studios through to three bedrooms with a domestic staff quarter, most layouts with two private balconies, open plan living rooms, fitted kitchens with granite countertops opening onto a laundry area, built in wardrobes and en suite master bedrooms.

The services are a strong set: high speed lifts in every block, a fully equipped gym, a rooftop terrace with city views, solar water heating, a standby generator, a borehole, DSTV and internet readiness, one designated parking space per unit with ample visitor parking, and security around the clock with CCTV, access control, patrol guards and electric fencing. It is also wheelchair accessible and pet friendly, which is rarer in Nairobi than it should be and worth saying in a listing.

Position is five minutes from Yaya Centre, ten from the Junction Mall, with Valley Arcade nearby, Makini and Precious Blood schools close, and Nairobi Hospital, the Aga Khan and Nairobi Women’s Hospital all within reach. Lavington, Kileleshwa and Upper Hill are the working destinations.

What does an apartment at Denis Gardens rent for?

Unfurnished, by the month:

• Studio. KES 40,000
• Two bedroom, master en suite, two balconies, 110 sq m. KES 65,000
• Three bedroom, two balconies, 120 sq m. KES 75,000 to 80,000
• Three bedroom, two en suite, DSQ, 150 sq m. KES 80,000 to 90,000

Furnished, by the night, from the same building’s rate card:

• Studio. KES 3,500 to 4,000
• Two bedroom. KES 7,000
• Three bedroom. KES 9,000
• Three bedroom plus DSQ. KES 10,000

Sale prices are quoted at KES 8.5 million for the 100 square metre two bedroom, KES 9 million with two balconies, KES 10 million for the three bedroom and KES 12.5 million for the three bedroom with DSQ. Against the rents those give gross yields between roughly 7.7 and 8.7 percent, which is a believable range rather than a promotional one. It is a useful benchmark to carry: when a newer tower advertises 15 percent, this is what honest Kilimani stock actually looks like.

Nine nights pays the month

Is a short let better than a long let at Denis Gardens?

Divide the monthly rent by the nightly rate for each layout and the picture is startling.

• Two bedroom. KES 65,000 divided by KES 7,000 is 9.3 nights, about 31 percent occupancy
• Three bedroom. KES 75,000 divided by KES 9,000 is 8.3 nights, about 28 percent
• Three bedroom plus DSQ. KES 80,000 divided by KES 10,000 is 8 nights, about 27 percent
• Studio. KES 40,000 divided by KES 3,500 is 11.4 nights, about 38 percent

At Winchester Gardens on Riverside Drive the nightly route only starts to pay above about 70 percent occupancy. Here it starts to pay above 31. Same city, opposite answer.

Be honest about what that comparison leaves out. The monthly figures are unfurnished and the nightly ones are not, so the nightly route requires you to furnish the apartment first, and that capital has to be recovered. Nightly letting also carries costs a tenancy does not: platform commission on every reservation, a full turnover clean after every departure, and short stay management at roughly double the long let fee because it is roughly double the work.

Put those in and the crossover moves from the low thirties into the mid forties. That is still comfortably below our Kilimani band of 62 to 74 percent occupancy for a well presented, actively managed short let. The headroom here is real, not theoretical.

The reason it differs so sharply from Riverside is worth understanding rather than just exploiting. On Riverside Drive the monthly rate is held up by diplomatic and corporate tenants whose housing is employer paid, so a furnished monthly let already captures a premium rent and the nightly route has little left to add. Denis Pritt Road has no such floor: its monthly rents are set by the ordinary Kilimani rental market at KES 65,000, while its nightly rates are set by the Kilimani visitor market. The gap between those two markets is the opportunity.

The arithmetic both ways is in short let against long term rental, what Kilimani does as a nightly market is in the Kilimani host guide, and the furnishing budget is in the cost to furnish a Nairobi apartment.

What the sold out studios tell you

Why did the studios and one bedrooms sell out first?

The marketing for this building notes that studios and one bedrooms are sold out while two and three bedrooms remain available. That is not an accident of timing. A studio lets at KES 40,000 a month and a 110 square metre two bedroom lets at KES 65,000, so per square metre of floor area purchased the studio earns dramatically more. Nightly the same holds: a studio at KES 3,500 to 4,000 against a two bedroom at KES 7,000 means two studios on one two bedroom footprint earn more than the two bedroom.

Investors work this out, which is why the small units go first in almost every Nairobi development. If you own a two or three bedroom here, the conclusion is not regret but positioning. Your unit does not win on yield per square metre and it should not be marketed as though it did. It wins on space, on the second balcony, on the DSQ, and on being suitable for a family or a group of four rather than one person, and there is far less competition at that end of the building.

What to do if yours is sitting empty

1. Run the crossover for your own layout. Monthly rent divided by nightly rate. If the answer is under twelve nights, the nightly route deserves a serious look
2. Photograph the rooftop terrace and the city view. It is the thing this building has that the next one on Denis Pritt Road does not, and the listings mention it without showing it
3. Market the second balcony and the DSQ. For the larger units these are the differentiators, and a DSQ reads better as a home office or guest room than as staff space
4. Say that it is pet friendly. It genuinely narrows a tenant’s options in Nairobi and almost no listing leads with it
5. Check the service charge collection rate. A borehole, a generator, solar water heating and lifts in every block are only an advantage while the levy funds them

The general diagnosis is in why your Nairobi rental keeps going vacant, and what the levy should cover is in service charge explained.

If you are looking to rent here

Denis Gardens is good value for Kilimani, particularly in the larger layouts. A 150 square metre three bedroom with two en suite bathrooms, a staff quarter and two balconies at KES 80,000 to 90,000 is a lot of apartment for the money by the standards of this neighbourhood, and the generator, borehole and solar water heating mean the basics are covered.

For a stay of a week or a month, ask for the long stay rate rather than taking the nightly one. The building publishes nightly rates and an owner holding empty midweek nights will usually go a long way past the rate card for a month. If you want us to tell you what is genuinely available, find a home is where to start.

How Goldstay handles it

We manage short stay and long lets in Kilimani, including on this road, and we sold nothing in this development, so there is no projection of ours to defend. We charge 10 percent of rent collected on a long let and 20 percent of revenue on a short stay, with no setup fee and no exit fee. At Denis Gardens the honest answer usually favours the short let, which is also the service we are paid more for, so the thing to hold us to is the arithmetic rather than the recommendation. Ask us for the crossover on your specific unit and check it yourself.

If your apartment is empty, send it to us with the floor and the layout and we will come back with an achievable rate both ways. What Airbnb management and long term management each cover is set out in full.

Related reading: Winchester Gardens, where the same sum points the other way, how the Kilimani apartment market is changing and pricing a Nairobi rental.