India's Adani Group severed from Nairobi Airport expansion role; government to go it alone with PPPs

For several years now the Kenyan Airports Authority (KAA) has intended to expand Nairobi's Jomo Kenyatta Airport quite considerably, by modernising existing terminals, building a new one and adding a second runway.

It was needed for two reasons - firstly, because capacity had been exceeded, and secondly, because the main terminal building opened in 1978, which is almost 50 years ago.

That said, Nairobi has lost its way a little as a gateway to and hub for East Africa, mainly to Addis Ababa, but there are new challengers on the horizon as well, such as the Bugesera airport project in Rwanda.

India's Adani Airports applied to improve the infrastructure in Mar-2024, by way of a 30-year lease agreement, but that proposal met stiff opposition due to concerns about transparency and terms, and the Kenyan government officially terminated the agreement on 24-Feb-2026.

Now the government will go it alone, but not completely, as it will seek private sector collaboration on individual projects such as a new terminal building by way of public-private partnerships. Adani could apply, but it has set its stall out as a whole airport operator - so that is unlikely.

This report looks at the options for reconfiguring the terminals in the light of changing demand, and the fact that two new airports in nearby countries will offer very tough opposition.

And in a late development just before publication the Airports Authority has issued a tender for the construction of new facilities and upgrades to existing infrastructure while confirming that an 'airport city' and special economic zone will be built.

The country's Prime Minister then went on to announce the establishment of a National Infrastructure Fund to close the infrastructure financing gap by raising over KES5 trillion (USD38.67 billion) to fund key projects and that it will provide the necessary financing for projects such as the expansion of Nairobi Jomo Kenyatta International Airport.