Nakumatt faces landlords’ wrath over unpaid rent

When Judge Joseph Onguto ruled that Nakumatt Supermarkets had failed to demonstrate that they deserved a receiver manager, the retailer’s lawyers were pensive that the chain could face massive evictions.

Nakumatt is in conflict with several landlords who are tied to the troubled retailer due to lease commitments but are not getting paid rent.

The troubled retailer had resorted to a last-minute move to appoint PKF Consulting partner Peter Kahi as administrator, which would allow them enjoy a moratorium against enforcement of their assets or evictions by landlords.

Nakumatt lawyers sought orders to block evictions after the ruling on Thursday afternoon. The retailer now faces a winding up suit by Africa Cotton Industries and Gold Crown Beverages. “We are asking for a moratorium pending the filling of an appeal in regards to execution by landlords,” said Diana Ogula, lawyer at IKM for Nakumatt.

Justice Onguto, however, said that the retailer did not need a moratorium since they had already filed a stay on execution in the case seeking its dissolution.

Landlords on their part have filed an application seeking to re-enter into their premises which is yet to be determined.

Some have managed to push Nakumatt out. Knight Frank kicked out Nakumatt from Village Mall, Acacia Mall, Victoria Mall, and Katwe in Uganda.

Nakumatt has also been driven out of outlets in Nairobi including Ronald Ngala, Haile Selassie, The Junction Mall, Thika Road Mall (TRM) and NextGen Mall on Mombasa Road.

The retailer has also closed Kisii, Busia and Eldoret branches. Recently, Garden City asked the High Court to allow it to repossess the space Nakumatt has occupied since May 2015 over unpaid rent, service charges and utilities amounting to Sh48.1 million.

Junction Mall managed to eject the retailer after a court battle after it defaulted between Sh50 million and Sh75 million in rent. Knight Frank, which manages the property, had issued a surrender notice which would allow it out of the lease agreement if Nakumatt failed to deliver on strict conditions and timelines.