91-day T-bill8.748%▼ 0.002
182-day T-bill8.859%▼ 0.001
364-day T-bill9.027%▼ 0.012
Central Bank Rate8.75%07/10/2026
Inflation6.8%September 2026
Top MMF yield10.52%Madison
Sources: CBK auction, 26 Oct 2026 value date (change vs 19 Oct); CBK key rates; fund managers' published yields, as at 25 Oct 2026.

Konza data centre is near full, so Treasury signs deal to find a private partner to expand it

The Konza National Data Centre is at or near full capacity. Treasury's PPP Directorate has signed a funding deal to hire an adviser and find a private partner.

PPP Directorate Director General Kefa Seda and KoTDA CEO John Paul Okwiri hold the signed Konza data centre funding agreement with officials in Nairobi
Photo: PPP Directorate

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The Konza National Data Centre, which hosts systems for ministries, county governments and private firms, is running at or near full capacity, and the government has now taken a formal step towards bringing in a private company to finance and run its expansion.

The Public Private Partnerships (PPP) Directorate at the National Treasury signed a funding agreement with the Konza Technopolis Development Authority (KoTDA) on Friday, October 23, to pay for preparatory work on the Konza National Data Centre Cloud Expansion and Smart City Facilities Project. PPP Director General Kefa Seda hosted KoTDA chief executive John Paul Okwiri for the signing.

The money will be used to hire a transaction adviser, who will structure the deal for the market and lead the search for a private partner. The agreement does not mean construction has started or that an investor has been picked.

Why the expansion is needed

The government started building the Tier III data centre at Konza in 2019 and finished it in 2021. It holds the Uptime Institute Tier III design and construction certification and offers cloud hosting, software and platform services, colocation and secure networking to government agencies and private clients.

According to the Treasury’s tender documents for the adviser, the facility is now operating at or near full capacity. That limits its ability to take on more ministries, counties and businesses at a time when the Kenya Cloud Policy of 2024 requires a cloud-first approach for public sector ICT systems.

A feasibility study that KoTDA completed in November 2025 found strong demand for local, secure cloud services. It pointed to the digitisation of government services, the National Artificial Intelligence Strategy (2025 to 2030), the growth of fintech and e-commerce, and the Data Protection Act of 2019, which pushes organisations to host certain data locally. The project entered the PPP pipeline in December 2025.

What the private partner would do

Under the proposed model, the private partner would finance, upgrade, expand, operate and maintain the existing data centre and related digital infrastructure, and carry the performance and operating risks. Ownership of the core infrastructure would stay with KoTDA for the length of the concession, which has not yet been set.

The planned work includes more rack space, computing power, storage and cloud capacity inside the existing building; upgraded power and cooling systems; stronger cybersecurity tools; and links to Konza’s smart city fibre network and operations centre. The operator would earn money from colocation, managed cloud services, disaster recovery and hosting digital platforms. The Treasury also wants the adviser to look at ways for local investors to put money into the project.

The adviser’s job runs from reviewing the feasibility study and building a financial model, to drafting the tender papers and PPP agreement, to supporting talks with the preferred bidder until financial close. The tender for the role was issued on March 16, 2026, and closed in April.

What it means for businesses

For companies that sell cloud, cybersecurity, power and cooling services, the deal opens a new route to large government contracts, much like the toll road concessions the Treasury is lining up and the Mombasa and Lamu port deals. Firms hoping to bid for work linked to the project will need to be on the government’s procurement system; our guide explains how to register on eGP Kenya as a supplier.

The expansion also comes as digital risks rise. The Communications Authority recently reported 2.7 billion cyber threat events in three months, which adds weight to the government’s push to keep more public data on secure local servers. Konza is also the planned site of a KSh80bn nuclear research reactor.

No cost estimate for the data centre expansion has been made public. That figure, along with the length of the concession and any government support, is expected once the adviser completes the structuring work.

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About Author

Norah Waceke is a business journalist and editor at Business Radar with more than eight years of experience covering Kenya's economy, companies and markets. She previously worked at one of Kenya's leading digital news platforms, where she reported on business, finance and current affairs. A graduate of Multimedia University of Kenya, Norah focuses on clear, accurate reporting that helps readers understand the money stories shaping their lives and businesses.

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