This archive report was first published on 29 August 2019.
Kenya's retail landscape is undergoing significant changes, with the proliferation of malls and the rise of mini-malls in residential areas. However, this shift has also led to challenges in anchor tenancy, with many malls struggling to sign anchor tenants and others losing key clientele.
One such example is the Lake Basin Mall in Kisumu, which was completed in 2017 at a cost of Sh4.2 billion. Despite its grand opening, the mall has yet to sign its first anchor tenant, leaving its future uncertain.
Experts argue that the traditional anchor tenant model, which relies on supermarkets as the main draw, is no longer sustainable. Ashmi Shah, the Retail Portfolio Manager at Knight Frank Kenya, suggests that the mall culture is what drives the need for anchor tenants, but the players may change over time.
Shah proposes separating the supermarket woes from the mall's problems, allowing landlords to approach local and international brands to fill vacated spaces. She cites examples of home-grown brands such as Naivas and Tuskys replacing other retailers as anchor tenants in some malls.
Francis Gichuhi, the principal architect at A4architect, suggests that mall developers should pool resources and offer better services and options to their key clientele. This could include fast food joints, hospitals, or utility firms that have a high visitor presence.
As the retail landscape continues to evolve, it is clear that the traditional anchor tenant model is no longer effective. Experts suggest rethinking the concept of anchor tenancy to include a wider range of businesses and services that can drive foot traffic and support other tenants in the mall.
