Hotels yet to be classified have six months to do so or risk penalties, the Tourism Regulatory Authority has warned.
Only 179 hotels were classified during the exercise conducted between 2015-2016. This translates to about 13,601 rooms and 22,692 beds.
Less than 20 hotels in the country are ranked five-star – 10 are in Nairobi, three in Mombasa, four in the South Rift and one in Northern Kenya.
Five-star hotels in Nairobi include Villa Rosa Kempinski, Hemingways, Sankara, Fairmont the Norfolk, Tribe Hotel, Sarova Stanley, Radisson Blu and Intercontinental.
The last classification was done in 2002 under the now-defunct Hotels and Restaurants Authority in the Ministry of Tourism.
However, the results were disputed by the majority of hotels.
TRA chairperson Nyule Gumbao on Friday said, “At the Coast region, only 39 hotels were classified. Every facility that offers restaurant and accommodation services must be classified.”
He spoke during a plaque awarding ceremony at the English Point Marina in Mombasa.
TRA said many hotel facilities missed the exercise because during the 2015-2016 window, they were either under renovation or had not put in place compulsory measures needed before a hotel is categorised.
TRA director general Kipkorir Lagat said many Nairobi hotels got the five star rating because they are new and match international standards.
International hotel brands have also opened up branches in Nairobi.
Government classification of hotels is done every five years at no cost, but a hotel can apply to either be reviewed or reclassified for a fee of Sh50,000.
"We urge all hotels that have been rated to maintain their standards. If a facility downgrades its services, the law allows us to recall the star rating and we will be doing quarterly visits to each facility," Lagat said.