Naivas Strengthens its Retail Presence in Nairobi CBD With Sixth Outlet

Naivas Supermarket has replaced cash strapped Uchumi along Aga Khan Walk at the Uchumi House strengthening its retail presence in Nairobi’s Central Business District.

The 20,000 square feet retail space becomes Naivas’ 6th branch within Nairobi. Other outlets are Muindi Mbingu Express, Ronald Ngala, Moi Avenue, Development House and Lifestyle Foodmarket.

The company said the expansion within the city aims to serve its growing population.

“I reiterate that the city’s population is still underserved, given that at least 3million people work, transit through or transact business within the CBD on a daily basis. This of course means they need to meet their daily shopping needs which we believe the new outlet will provide another strategic location for them to do so,” the retail chain’s Chief Commercial Officer Willy Kimani said Friday in a statement.

Cytonn Investments, Retail Sector 2021 report, the Kenyan retail sector witnessed aggressive expansion by local and international retailers compared to 2020 which was marked with lockdowns leading to retailers scaling down their businesses to cushion themselves against the pandemic.

In the year, the sector’s performance recorded a 0.1% increase in the average rental yields to 6.8%, from 6.7% in 2020. 

Average occupancy rates and rental rates also realized an increase of 1.8% points and 2.2%, respectively, to 78.4% and Kshs 118 per SQFT in 2021 from 76.6% and Kshs 115 per SQFT in 2020, respectively, as a result of an improved business environment, Cytonn said.

Within the Nairobi Metropolitan Area, the retail market recorded average rental yields of 7.5% similar to 2020, with occupancy rates coming in at 75.8%, a 0.6% points increase from the 75.2% realized in 2020 due to the increased demand for spaces.

“This is attributed to an increased demand for retail spaces evidenced by retailers such as Naivas aggressively taking up new spaces as well as spaces previously occupied by troubled retailers and improvement in infrastructure opening up areas for retail investments. 

Rental rates remained subdued at Kshs 168 per SQFT in 2021 when compared to the Kshs 169 per SQFT recorded in 2020 as a result of landlords offering lower rental rates to attract new tenants as well as retain existing ones, and the growing e-commerce thereby causing reduced demand for physical retail spaces.,” Cytonn said in the report themed ‘Rapid Expansion by Retailers to Cushion the Retail Sector’.