Commercial Lease Terms in Uganda
Updated 3 November 2026 · Land & Property editorial team
Commercial lease length in Uganda is agreed between the parties, not set by law. The Landlord and Tenant Act, 2022 covers business premises and sets some defaults: rent rises capped at 10% a year unless the lease says otherwise, 60 days notice, at most three months rent in advance, and landlord consent for fit-out. As of November 2026, put every other term in writing.
- Law that applies
- Landlord and Tenant Act, 2022, covers business and residential premises (s.1)
- Rent increase default
- 10% a year, 60 days notice, not within 12 months of the last rise (s.26)
- Rent in advance
- Maximum three months unless both sides agree (s.24)
- Written lease
- Needed to enforce a tenancy worth UGX 500,000 or more (s.4 and Schedule 1)
How long are commercial leases?
The law does not fix a length. Section 37 of the Landlord and Tenant Act, 2022 says a fixed-term tenancy ends on the date the lease names, and section 22(1) says rent is whatever the parties agree (source 1). We found no published survey of typical lease lengths in Uganda, so we do not quote one. We also found no provision in the Act that gives a business tenant a right to renew when the term ends. So if you are putting money into a shop or office, negotiate the term and any renewal option into the lease in writing.
Section 4 says a tenancy worth 25 currency points or more, which at UGX 20,000 per point is UGX 500,000, cannot be enforced in court unless it is written, in the form of a data message, or the other party admits it. Section 5 says the landlord must give you a copy as soon as it is signed. Section 3(5) says a landlord must not sign with an individual who has not shown an identification document, or with a company that has not shown registration details.
How much can the rent go up each year?
Section 26 sets the default. Unless the tenancy agreement says otherwise, a landlord may not raise rent by more than 10% a year, must give at least 60 days notice in the prescribed form, may not raise it at intervals shorter than 12 months, and under a fixed term may not raise it before the term ends unless the lease provides for a rise. An increase that breaks the section is invalid. Under section 27, a tenant who neither objects nor negotiates is taken to have accepted a rise that complies with the Act.
Because the 10% cap gives way to what the lease says, the escalation clause matters more than the statute. Compare these common structures:
| Clause | What to watch |
|---|---|
| Fixed percentage each year | Easy to budget. Check it is not above 10% unless you accept that. |
| Review to market rent | Open-ended. Ask for a cap, a named valuer and a right to challenge. |
| Rent in US dollars | Section 22(2) says rent is settled in Uganda shillings unless the lease says otherwise, so a dollar clause exposes you to the exchange rate. |
Also check that you pay rent into the bank account the landlord gives you, which section 21(4) requires for business premises in a city or municipality, and keep the receipts section 25 requires.
Who pays service charge?
Section 46 lets a landlord charge a service fee for extra services such as security, conservancy, sanitation and other amenities. The fee covers services, repairs, maintenance, improvements, insurance and management costs, and it varies with the relevant costs. The Act does not say how it is shared between tenants or cap it. Knight Frank's mall rents exclude service charges (source 2), so the total cost is higher than the rent figure. A 2022 Makerere undergraduate study found that many commercial properties in Uganda use unclear methods to share these charges (source 3).
Ask for: the service-charge budget, the formula for your share, an annual statement of actual costs, the right to see the invoices, and a cap or review limit in the lease. Do not accept a bare line saying "service charge as determined by the landlord". See shops for rent Kampala for retail rent ranges.
Who pays for fit-out and repairs?
Section 7 says the landlord must keep the premises in good repair, including the exterior and common areas, with the standard judged by the age and character of the building. Section 18 says a tenant needs the landlord's consent to install fixtures or make any alteration, renovation or addition. Before the tenancy ends, the tenant must restore the premises (fair wear and tear excepted) or pay the reasonable cost of restoring them, unless the lease or a later agreement says otherwise.
So a fit-out is mostly your cost and your problem to undo. In the office market Knight Frank reports that landlords used fit-out contributions, rent-free periods and phased occupation to close deals without cutting headline rent, and that Grade AB landlords with high vacancy leaned on incentives (source 2). Those are negotiated, so ask. If you spend heavily on fit-out, write down who owns the fixtures, whether you must remove them, and whether you get a longer term in return.
How do you exit a commercial lease?
A tenancy ends by agreement (section 35), by the tenant leaving with the landlord's consent (section 36), at the end of a fixed term (section 37), or by notice (section 38). The notice periods set in section 38(2) are for residential tenancies, so for a shop or office the notice is whatever your lease says. Write down the notice period, the early-exit penalty, who may take over the lease, and what happens to your deposit.
Assigning the lease or subletting needs the landlord's written consent, which must not be unreasonably withheld (sections 31 and 32), and doing it without consent is invalid and ends the tenancy (section 33). Section 45 bars unlawful eviction and, where it happens, entitles the tenant to court relief or the equivalent of three months' rent. The security deposit is limited to one month's rent or one-twelfth of a year's rent, whichever is less (section 30).
What should a commercial lease checklist include?
- Names, identification or registration, and proof the landlord can let the premises.
- Term, renewal option, rent, review method and currency.
- Deposit, advance rent and how rent is paid and receipted.
- Service-charge budget, share and cap.
- Permitted use, signage and opening hours.
- Fit-out consent, ownership of fixtures and restoration.
- Notice, early exit, assignment and subletting.
- Parking and utilities. Knight Frank says parking has become decisive in office leasing.
Take a licensed advocate's advice before signing. If you are buying instead, read commercial building due diligence and Shops and Commercial Buildings for Sale in Kampala. Farmers leasing land should see agricultural land lease, and those looking at Kenya can compare Offices to Let in Nairobi: Westlands, Upper Hill, CBD. Our hub is Commercial Property in Uganda, and you can Commercial Land Near Kampala for Development, Commercial property for sale Kampala or shops for rent Kampala. We had no commercial listings on 3 November 2026 (Land & Property listings, Nov 2026); browse commercial listings or ask our team on WhatsApp or by email.
Frequently asked questions
How long are commercial leases?
The Landlord and Tenant Act, 2022 does not set a length. The term is whatever you and the landlord agree, and a fixed-term lease ends on the date it names. We found no right to renew in the Act, so negotiate any renewal option in writing.
Who pays service charge?
The tenant, if the lease says so. Section 46 lets a landlord charge a service fee for extra services such as security and sanitation, varying with the costs. The Act does not cap it, so ask for the budget, your share formula and a cap.
Can my landlord increase the rent whenever he likes?
No. Unless your lease says otherwise, section 26 limits increases to 10% a year, with 60 days notice, and not within 12 months of the last increase. Under a fixed term, a rise before the term ends needs a clause allowing it.
Do I need a written lease for a shop?
For a tenancy of 25 currency points (UGX 500,000) or more, section 4 says it is not enforceable by action unless it is in writing, in a data message, or the other party admits it. In practice, always sign a written lease and keep your copy.
Sources
- Landlord and Tenant Act, 2022 (Act 9 of 2022, Uganda Gazette supplement), ULII / Uganda Printing and Publishing Corporation (accessed 2026-11)
- Kampala Property Market Performance Review, H1 2026, Knight Frank Uganda (accessed 2026-11)
- Assessing the effect of service charge on the tenancy of shopping malls in Kampala, Makerere University (undergraduate dissertation, 2022) (accessed 2026-11)
- Land & Property listings, Nov 2026 (93 published listings, none in the commercial category), Land & Property (accessed 2026-11)