Troubled Nakumatt now kicked out of Garden City

Shoppers at the Nakumatt store at Nairobi’s Garden City Mall. PHOTO | Salaton Njau | NMG
Shoppers at the Nakumatt store at Garden City Mall. FILE PHOTO | Salaton Njau | NMG 

Thika Superhighway-based Garden City Mall has evicted struggling retailer Nakumatt from its premises over unpaid rent, service charges and utilities.

GC Retail, which owns Garden City, is now eyeing a new anchor tenant for the expansive mall.

The mall owner had earlier asked the High Court to allow it to repossess the space Nakumatt has occupied since May 2015 over monies owed to it amounting to Sh48.1 million.

Stuart Gibson, the General Manager of Broll Kenya Limited which manages the premises, told the Business Daily last week that the troubled retailer had been evicted.

“We can confirm that on  November 27 we exercised our legal right as landlord to peaceably re-enter the Nakumatt premises at Garden City Mall,” said Mr Gibson.

“We regret the necessity to take this action following Nakumatt’s recent application for administration, where it admitted insolvency, and the High Court’s subsequent rejection of its proposed rescue plan.” The mall owners had earlier said Nakumatt was in default from June 1, 2016.

GC Retail’s eviction plan had however been hampered by Nakumatt’s application to have an administrator run the retailer until it returned to stability. GC Retail had earlier claimed that Nakumatt’s decline had affected traffic into the mall, affecting other tenants.

Garden City had claimed in court documents that pedestrian traffic was rising 22 per cent per month when Nakumatt was doing well, but the growth had slowed to below a 10 per cent.

“The development directly and indirectly employs 2,000 people. GC Retail has received complaints from virtually all the tenants in relation to significant losses suffered as a result of reduced footfall caused by Nakumatt’s insolvency. Nakumatt is effectively a failed anchor tenant,” GC Retail centre manager Edward Mugambi had said in court documents.

Nakumatt has over the past one year shut down a number of non-performing outlets in Kenya, Uganda and Tanzania as it grapples with heavy financial obligations.

It recently closed its Milimani City store in Dar es Salaam and its Bungoma and Busia branches in western Kenya.

Other stores shut include Junction Mall in Nairobi, Bamburi branch in Mombasa; Lunga Lunga in Nairobi; Thika Road Mall on Thika Road, Next Gen on Mombasa Road and Westgate in Westlands, Nairobi.