Galleria Mall says it cannot pay bank loans
The owners of Galleria Mall are back in court seeking to evict cash-strapped retailer Nakumatt, arguing that the supermarket’s presence in the shopping complex is killing its business.
Galleria Mall claims that the Kenya Revenue Authority (KRA) has attached the rental payments from its remaining tenants, making it difficult for it to meet its loan obligations.
Parkside Developments Limited claims that KRA has directed the tenants at the Galleria Mall to pay the rents directly to the taxman over unsettled Sh86 million tax arrears.
DEPLETED REVENUE STREAMS
Parkside developments says that the move by KRA has depleted its remaining revenue streams, making it difficult for it to service its bank loan.
It wants the court to allow it to take over the space currently occupied by the Nakumatt.
“That this honorable court hereby grants leave to the interested creditor to exercise its right of forfeiture and re-enter its premises known as unit 0.1 situated on the ground floor of Galleria mall,” reads one of the orders sought by the firm.
The firm says it has already secured another tenant who is ready to occupy the space, arguing that Nakumatt has not restocked the mall and this has reduced the foot traffic to the shopping complex, affecting other tenants.
The firm claims that Nakumatt owes it in excess of Sh107 million in rent arrears and other service charges.
Last month the High Court gave Nakumatt Holdings a lifeline to fight for its recovery after it allowed the appointment of an administrator.
Justice Fred Ochieng ordered Peter Obondo Kahi to be appointed as an administrator under the provisions of Section 563 of the Insolvency Act.
Consequently, this keeps at bay the landlords who have been queuing to evict Nakumatt from its premises, unless allowed by court or by consent of the administrator.
The administrator is expected to, within 60 days of his appointment, ensure a meeting of all Nakumatt creditors is held and address all their concerns.
But the firm accuses the administrator of failing to engage it in any manner with a view to settling the debt.
The Judge in his ruling had left a window open for the parties to make an application for eviction if need arises.