Troubled retailer Uchumi Supermarket could be evicted from the premises that house its Buruburu branch, following a default on rent for 28 months now.
The owners of the premises, Fairlane Supermarkets Ltd, have gone to court seeking orders to evict Uchumi over the rent, which has now accumulated to Ksh27.7 million.
The retailer has been occupying the ground floor of the Fairlane Centre in Buruburu Shopping Centre, and has been the only Supermarket until a recent entry by Tuskys and Naivas.
“Uchumi ceased all commercial activities at the premises in November 2018 yet refuses to yield possession back to Fairlane Supermarkets Ltd,” said Joe Murage, the lawyer representing Fairlane.
Uchumi, according to the lawyer, has been relying on a High Court order issued on October 2, 2018 in an insolvency petition to stop Fairlane from evicting them.
“Uchumi has been using the orders granted on October 2, 2018 as a shield from meeting its rental commitments and a spear against Fairlane Supermarkets Ltd right to its properties as enshrined in the constitution,” argued the petitioner.
The facility, according to reports by Business Daily, is charged to Standard Chartered Bank for a loan of Ksh100 million.
“Fairlane Supermarkets Ltd stands to lose ownership of its property at auction, owing to the massive loan and Uchumi’s failure to pay rent for 28 months. There is no reason for justifiable or at all, for Uchumi to remain in possession of the premises if it ceased all operations and/or commercial activities thereat,” argued Fairlane.
Currently, Uchumi owes suppliers at least Ksh3.6 billion and has closed over 30 branches countrywide. Another Ksh2.5 billion is owed to banks as loans, charged against Uchumi’s asset base of Ksh6.1 billion.