Clothing retailer LC Waikiki Retail Kenya Ltd has blamed low sales and dwindling customer traffic for its decision to terminate a lease agreement with Nova Holdings Ltd, the landlord of Likoni Mall in Mombasa.
Thank you for reading this post, don't forget to subscribe!The retailer claims that business performance at the outlet has declined sharply since 2023, making the location financially unsustainable.
In a sworn affidavit, LC Waikiki’s finance and accounting manager Moses Chege said that despite regular promotional campaigns and marketing efforts, the store consistently underperformed.
The company argues that continuing to operate under these losses was not commercially viable.
The retailer issued a three-month termination notice effective July 1, ending the lease on September 30, 2025.
However, Nova Holdings sued the retailer, seeking to block the early termination and maintain the lease for its full duration.
Court Halts Waikiki’s Exit
The High Court in Mombasa, presided over by Justice Wendy Micheni, issued temporary orders preventing LC Waikiki from vacating the premises.
The orders also restrained the retailer from terminating the lease until the case is fully heard.
Chege explained that LC Waikiki had engaged Nova Holdings to discuss ways to improve business performance, including a 10 percent rent discount for six months (July to December 2024) and proposals for joint marketing campaigns. Despite these measures, losses continued into 2025.
“We tried various strategies to attract more customers and reduce costs, but sales remained below expectations,” Chege stated, adding that the store operated under heavy financial strain while still meeting its rental obligations.
Legal Battle Over Termination Rights
According to LC Waikiki, it exercised its contractual right to terminate the lease due to financial hardship, arguing that it cannot be forced to sustain a loss-making tenancy.
The company contends that Nova Holdings’ refusal to release the premises or allow subleasing made the situation untenable.
Nova Holdings, represented by lawyer Willis Oluga, accuses LC Waikiki of already beginning to vacate Likoni Mall and removing its stock, arguing that this could undermine recovery if the court rules in Nova’s favor.
Chege dismissed Nova Holdings’ claims as unfounded, saying that enforcing the injunction would compel LC Waikiki to continue paying rent and service charges for an unsustainable outlet.
“Such an order would be unfair and would prejudice our business interests,” he said.
