French retailer Carrefour, whose local franchise is held by Dubai-based conglomerate Majid Al Futtaim, is said to have received multiple invitations in recent weeks to move in as anchor tenant in Nairobi malls that are struggling to deal with the vacuum left by troubled Nakumatt.
Carrefour, which is the world’s second-largest supermarket chain after Wal-Mart, has accepted some of the invitations and is later this month expected to open its third shop at the Thika Road Mall (TRM) – taking over the space that Nakumatt vacated in July.
It has two stores in Nairobi’s The Hub in Karen and Two Rivers Mall since May last year.
Botswana retailer Choppies, which entered the Kenyan market last year by taking over nine Ukwala Supermarket stores, has since opened two new outlets, increasing its branch count to 11.
Two foreign-owned international supermarket chains have been thrust into a rapid expansion to fill the void left by struggling local retailers that have dominated the market for decades.
French retailer Carrefour, whose local franchise is held by Dubai-based conglomerate Majid Al Futtaim, is said to have received multiple invitations in recent weeks to move in as anchor tenant in Nairobi malls that are struggling to deal with the vacuum left by troubled Nakumatt.
“Majid Al Futtaim is actively seeking opportunities to open stores in Kenya and the rest of the greater East African region in the coming years,” the firm said in a statement.
Carrefour, which is the world’s second-largest supermarket chain after Wal-Mart, has accepted some of the invitations and is later this month expected to open its third shop at the Thika Road Mall (TRM) – taking over the space that Nakumatt vacated in July.
It has two stores in Nairobi’s The Hub in Karen and Two Rivers Mall since May last year.
Choppies said it plans to open seven new outlets by end of the year – including two at shopping malls originally occupied or booked by Nakumatt.
The surge by foreign retailers is happening as Uchumi, Tuskys, Naivas and Nakumatt have limited their market presence, with the closure of several branches after years of seemingly unconstrained growth, marking a shift in the local retail sector.
Ben Woodhams, the managing director of Knight Frank, a real estate firm that manages several shopping malls in Kenya, said he expects Carrefour to bid for retail stores if they fall vacant.
Knight Frank does not manage either stores where the retailer currently operates nor is it in talks with Carrefour.
Mr Woodhams, however, said it was evident that the French retailer is doing well at its present locations and that it “must be looking at spaces such as Garden City or Mega with the aim of growing its business.”
Choppies is set to open new branches at Kiambu Mall (Kiambu), Southfield Mall (Embakasi, Nairobi), Diamond Plaza (Parklands, Nairobi), Signature Mall (Molo), and Spur Mall (Ruiru) among others.
Nakumatt, which has dominated Kenya’s retail scene for years, has in recent months faced an existential threat caused by a heavy debt load and delay in getting new capital that left it with no means to refinance its obligations to employees, suppliers and lenders.
Tuskys in February shut down its branch on Nairobi’s Sheikh Karume Road and has since then lost two more outlets in the city due to differences with landlords.
Naivas has recently shut its Githunguri and Ronald Ngala [in Nairobi] branches said to have failed to “break even.”
The family-owned retailer is, however, opening three branches over the next month with plans for more thereafter.
“It is evident these foreign-owned retailers are increasing their presence locally. However, they are simply occupying spaces earmarked for Nakumatt,” Willy Kimani, Naivas’ chief operating officer, said in an interview