Commercial Property in Uganda: An Investor's Guide

What returns do offices, shops and warehouses earn in Kampala?

The best published numbers come from Knight Frank Uganda, whose market reviews are quoted by the regional press. They are asking-rent and prime-building figures, not what an average building earns after costs, so treat them as the top of the range. The table pulls together the figures we could open and check as of November 2026.

Two cautions. First, the yields are from earlier periods than the H1 2026 rents, and the H1 2026 review we read does not restate yields, so we do not claim a current yield figure. Second, we found no published yield for retail that we could open, so we give retail as rents and footfall only. Dollar rents convert at the shilling rate of the day. Knight Frank put the shilling at an average of about UGX 3,710 to the dollar in June 2026, so US$17 is roughly UGX 63,000 per sqm per month (our arithmetic).

Is Kampala office space oversupplied?

Yes in the older, secondary buildings, and mixed in the new ones. Knight Frank's H1 2026 review says about 65,000 sqm of office space was delivered in the half, compared with roughly 50,000 sqm across the whole of 2025. Much of it was built for the owner to occupy or for government use, so the amount you can actually rent is smaller. More than 130,000 sqm is in the pipeline.

The review describes a flight to quality. Thirteen justice sector institutions moved into JLOS Towers in March 2026, which released older buildings into a Grade AB segment that already had high vacancy. Grade A rents rose to US$17.0 (from US$16.5 a year earlier) while Grade AB eased to US$14.0 (from US$14.50). Landlords of older stock are giving fit-out contributions, rent-free periods and phased occupation instead of cutting headline rents. Business Times Uganda had warned in February 2025 that supply would outrun demand and that some tenants, including government bodies, might vacate rented space.

For a buyer the message is simple. A modern building with parking and a creditworthy tenant behaves differently from a tired building in the central business district. Our full note is on Office Space in Kampala: Rents, Supply and Yields.

Do shops and malls still make money?

Mall space is nearly full, but customers are spending less per visit. In Knight Frank-managed malls, occupancy rose year on year in every month of H1 2026 and prime rents held firm because little space is vacant. Footfall, however, rose only 1% on average over the half. By month it was up 8% in February and March, down 2% in April, up 1% in May and down 11% in June, which the review links to fuel costs, tighter household budgets and an Ebola outbreak.

Neighbourhood centres led new leasing, with ground-floor space above 85% occupied and first and second floors around 80%. Knight Frank reports about 700 sqm let across its managed malls in the half, mostly units of 50 to 200 sqm taken by electronics and jewellery retailers, financial institutions and service businesses. The same review gives prime ground-floor mall rents that fall as units get larger, from US$225 per sqm per month for spaces under 10 sqm to US$12-16 for spaces over 1,000 sqm. They exclude service charges. For stand-alone shops and arcades read shops for sale Kampala.

Why are warehouses yielding more?

Warehouses carry higher yields because the buildings are cheaper to put up and the tenants are traders and logistics firms rather than corporate head offices. Business Daily, reporting Knight Frank's industrial tracker on 2 September 2025, put the average prime warehouse yield in Kampala at 13%, ahead of Dar es Salaam at 10% and Nairobi at 9.5%, and said occupancy was above 80%. Knight Frank's H1 2026 review shows occupancy still above 80% and rents of US$3.00 to US$7.00 per sqm per month.

The review adds that older secondary warehouses face softer rents while modern buildings command a widening premium, and that road conditions in the Traditional Industrial Area are eroding access. Read the detail on Warehouses for Rent or Sale in Kampala.

What lease terms are normal for commercial property?

Business Times Uganda, quoting the Knight Frank review in February 2025, reported typical office leases of 3 to 5 years and yearly escalations of 3% to 5%. Landlords sometimes grant a rent-free period or fit-out contribution on longer terms. The Landlord and Tenant Act, 2022 (Act 9 of 2022) applies to the letting of "residential and business premises" (section 1(1)), so a shop or office lease sits under it. Points that matter to an investor:

• A tenancy worth 25 currency points or more (UGX 500,000, at UGX 20,000 a point under Schedule 1) can be enforced in court only if it is in writing or in a data message, or the other side admits it (section 4).
• Rent is set by agreement (section 22). Unless the 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, and may not raise it within 12 months of the last rise (section 26). A fixed yearly step, such as the 3% to 5% in the press report, is therefore a matter of what the lease says.
• A landlord letting business premises in a city or municipality must give the tenant a bank account number for all rent payments (section 21(4)).
• A tenant may not sublet or assign without the landlord's written consent, and an unauthorised sublet is invalid and ends the tenancy (sections 31 to 33).
• The statutory notice periods in section 38(2) are written for residential tenancies. For a shop or office, the lease should state the notice period itself.

See Commercial Lease Terms in Uganda for clause-by-clause points. This is general information as of November 2026, not legal advice.

What costs and taxes cut a commercial yield?

A headline yield is rent divided by price. Your own return is lower once you take off the costs of owning. The Uganda Revenue Authority (URA) describes the main tax items for landlords:

• Rental income tax. URA's 2022 guidance says an individual pays 12% on gross rent above UGX 2,820,000 a year, with no expenses deducted, and a company pays 30% after deducting up to 50% of the rent as expenses.
• VAT. URA's landlord page says a landlord earning commercial rent above the registration threshold must register, charge tenants 18% VAT and remit it. A URA notice first published on 30 October 2026 says the annual registration threshold rose from UGX 150 million to UGX 300 million from 1 July 2026. Older URA pages still show the old figure.
• Withholding. A designated withholding agent deducts 6% from rent payments above UGX 1 million, and the tax withheld is credited against the landlord's final tax.

Financing matters too. Knight Frank reported that shilling lending rates edged up to 18.63% in the 2026 half-year, and the central bank rate stayed at 9.75%. A building bought with an 18% loan and yielding 9% costs money to hold, which is why many investors in this segment buy with cash. As an illustration only, not market data: a building bought at UGX 2,000,000,000 with rent of UGX 180,000,000 a year is a 9% gross yield. If it stands empty for three months in the year, rent received is UGX 135,000,000 and the yield falls to 6.75% before repairs, service charge, tax and management. Compare with Commercial Building Due Diligence in Uganda before you price an offer.

Where do I start if I want to buy or let commercial property?

Start by deciding the role. A buyer who wants income needs tenant, lease and title checks. A buyer who wants growth may do better with serviced land: see commercial land for sale Kampala and, for very large holdings, buy large land Uganda investment. If you are investing from abroad, Uganda Property Investment Guide for High-Net-Worth Buyers covers structure and payment.

On 3 November 2026 our listings snapshot held no commercial listings: all 93 published listings were plots, farmland, houses and apartments for sale. That is a fact about our stock, not about the market. If you want a shop, office or warehouse we do not yet list, ask our team on WhatsApp or by email and we will tell you what we can verify. You can also browse commercial listings as they are added. Every agent who lists on our platform is checked with a National ID and live selfie before getting a Verified badge.

Frequently asked questions

Related guides

• Commercial Property in Uganda: Shops, Offices, Warehouses
• Office Space in Kampala: Rents, Supply and Yields
• Shops and Commercial Buildings for Sale in Kampala
• Warehouses for Rent or Sale in Kampala
• Commercial Lease Terms in Uganda
• Commercial Building Due Diligence in Uganda