LC Waikiki Ends Likoni Mall Lease Over Low Sales, Faces Legal Battle with Landlord

Turkish fashion retailer LC Waikiki Retail Ke Ltd has cited persistent low sales and weak customer turnout as the main reasons behind its decision to terminate a sublease agreement with Nova Holdings Ltd at Likoni Mall, Mombasa. The move has now triggered a legal showdown with the landlord, who accuses the retailer of breaching its lease terms.

According to court documents, LC Waikiki’s management said the store had been recording poor performance despite several attempts to turn it around. The retailer reportedly implemented a series of interventions, including rent reductions, targeted marketing campaigns, and operational restructuring, but the outlet continued to operate at a loss.

As a result, the company opted to invoke a clause in the lease agreement allowing for early termination, with the exit set to take effect on July 1, 2025. Nova Holdings, a company linked to businessman Ashok Doshi, has, however, challenged the decision in court, seeking an injunction to prevent the termination.

The landlord is demanding Ksh 40.4 million in rent arrears and VAT, along with Ksh 5.4 million in service charges. Nova Holdings argues that the lease was valid until December 3, 2027, and that LC Waikiki’s early exit would constitute a breach of contract.

The dispute has now landed before the High Court, which is expected to deliver its ruling on November 5. The outcome could set a precedent for how commercial landlords and tenants handle lease agreements amid changing retail market conditions in Kenya, especially as international brands grapple with shifting consumer habits and reduced mall traffic.