St Michael Garden Apartments, Westlands: 1,640 square feet that rents for less than 1,000

A two bedroom plus staff quarter at St Michael Garden Apartments runs to 1,640 square feet and asks KES 100,000 a month. A two bedroom of 970 square feet in a new tower a kilometre away asks KES 150,000. Nothing is wrong with either listing. The gap between them is the single most useful thing an owner here can understand.

What the building actually is

A small, low key development on St Michael Road, off Church Road in Westlands, of two bedroom apartments with the master en suite and a self contained domestic staff quarter. Units run to 1,640 square feet with a spacious living room, a separate dining area, built in wardrobes, a kitchen with granite tops opening onto a utility area, a balcony and one reserved parking space.

The services are the solid, unglamorous set that actually matters in Nairobi: two lifts, a full backup generator, a borehole with water storage tanks, solar water heating, CCTV, intercom, an electric fenced boundary wall and manned security around the clock. There is no rooftop pool and no gym, and for a certain tenant that is a feature rather than an omission.

Position is quiet residential Westlands rather than the commercial core: close to ABC Place, Nairobi School, Kenya High School, Westgate and Lavington Mall. Good for a family. A longer commute for someone whose office is in a Westlands tower.

What does an apartment at St Michael Garden Apartments rent for?

Published listings put the two bedroom plus DSQ at KES 100,000 a month furnished with the KES 12,000 monthly service charge quoted on top, and a sixth floor two bedroom on the same road at KES 110,000. The same stock has been marketed for sale at KES 17.5 million unfurnished.

That pairing is worth pausing on, because it is honest in a way much new build material is not. KES 100,000 a month against KES 17.5 million is a gross yield of about 6.9 percent, and about 6 percent once the levy comes out. That is what good Nairobi apartment stock actually produces. When you next see a tower advertising 15 percent, this is the number to hold it against.

Size does not price in Westlands

Why does a larger apartment here rent for less than a smaller one in Westlands?

Set the two side by side. Here: 1,640 square feet, two bedrooms, a separate dining room, a staff quarter, KES 100,000. In a new tower on Westlands Road: 970 square feet, two bedrooms, a rooftop heated pool, a gym, face scan entry, a five minute walk to the Global Trade Centre, KES 150,000 to 180,000. Nearly 70 percent more floor area for 40 percent less rent.

The Westlands tenant who sets the top of the market is not buying square feet. They are buying the walk to the office and the things they can photograph.

This is not an argument that the tower is better. It is an argument about who your tenant is. The corporate arrival, the expatriate on a two year posting and the regional executive drive the upper end of Westlands rents, and they want a short commute, a secure lobby and amenity they will mention to colleagues. A separate dining room is not on their list, and a domestic staff quarter is of no use to them at all.

For a family with children at Nairobi School or Kenya High, both are on the list, the quiet road is an advantage, and the staff quarter is one of the few in modern Westlands stock. That is your tenant. The mistake owners here make is to benchmark against the towers, conclude the unit is underpriced, hold out, and lose three months of rent waiting for a tenant who was never looking at this building.

The levy is quoted on top, and that costs you

Who pays the service charge at St Michael Garden Apartments?

The listing reads “rent KES 100,000 plus service charge KES 12,000”, so the tenant pays the levy on top. That is normal in Nairobi. It is also, in a soft letting month, quietly expensive.

A tenant scrolling listings sees KES 100,000 and a second number, and most of them do the addition. Your unit reads as KES 112,000 against a neighbouring listing that reads KES 110,000 all in, and you have lost the comparison before anyone has seen the apartment. Two things follow:

• Quote one inclusive figure when the unit is empty. Advertising KES 112,000 inclusive beats advertising KES 100,000 plus KES 12,000, even though they are the same money, because one of them is a single number a tenant can compare
• Know what the KES 12,000 buys. On 1,640 square feet that is roughly KES 88 per square foot a year, and it is funding a generator, a borehole, two lifts and manned security. That is a reasonable levy for that list, which is a better position than most
• Ask for the collection rate, not the budget. A levy nobody is paying buys nothing, whatever the schedule says

What a levy should cover and how to read a bad one is in service charge explained.

Is this a short let building?

Mostly not, and that is worth saying plainly because the instinct in Westlands is to furnish everything and list it nightly. Our Westlands data puts a well presented short let at 64 to 76 percent occupancy across a full year, but the demand behind that number is corporate and it wants to be near the towers. A large family apartment on a quiet road off Church Road is not what that guest is searching for.

Where this building does work for furnished letting is the monthly route: relocating families, diplomatic and NGO postings, and people between houses who need three bedrooms worth of space for six months. That tenant pays well, stays long, and needs almost nothing from you, which is the opposite of the nightly business. The comparison in full is in furnished or unfurnished and short let against long term rental.

What to do if yours is sitting empty

1. Market the DSQ and the dining room as the headline. They are what you have that the towers do not, and most listings for this stock bury them in a feature list
2. Quote one inclusive monthly figure. Rent plus levy loses to a single number on a search page
3. Target schools, not offices. Nairobi School, Kenya High and the international schools are the demand driver for a unit this size, and nobody advertises to them
4. Stop benchmarking against Westlands Road towers. A different tenant, a different product, and an expensive comparison to hold out for
5. Ask your agent for the viewing count. No viewings is a marketing fault, viewings without offers is a pricing or presentation fault, and they are fixed differently

The general diagnosis is in why your Nairobi rental keeps going vacant, and how to set the number is in pricing a Nairobi rental.

If you are looking to rent here

This is one of the better value family lets in Westlands, and the reason is unglamorous: you are paying for space in a quiet building rather than for a pool and a lobby. A borehole, a full generator and a staff quarter at KES 110,000 or so is a strong offer if your life involves children and school runs rather than a walk to a tower.

Ask two questions before you sign. First, whether the quoted rent includes the service charge, because here it usually does not. Second, what the water situation actually is, since a borehole on the amenity list and a borehole that runs are different things, and the people in the building will tell you straight. If you want us to tell you what is genuinely available, find a home is where to start.

How Goldstay handles it

We manage long lets and short stays in Westlands, including in this building, and we sold nothing here, so there is no sales 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 St Michael Garden Apartments the advice is usually the unfashionable one: let it long, let it to a family, and stop comparing it to buildings its tenants are not looking at.

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

Related reading: the complete guide to Westlands, Misty Springs, the tower this building is compared against and the best neighbourhoods for rental yield.