NAIROBI, Kenya — Kenya’s leading supermarket chains are rethinking their expansion models, pivoting from large regional malls to neighbourhood centres in middle-income estates as consumers grow more price-conscious.
According to Knight Frank’s H2 2025 retail report, the shift reflects changing spending patterns and the rapid rise of discount retailers reshaping the competitive landscape.
The report notes that established brands such as Naivas, Quickmart, and Carrefour Kenya are increasingly targeting community-based locations rather than relying solely on high-end mall spaces.
“The outlook for Kenya’s retail real estate market in 2026 will be defined by a continued shift toward neighbourhood centres and mixed-use developments, with less emphasis on large regional malls,” the report states.
Knight Frank attributes the trend to the expansion of discount and budget chains such as China Square, China Village, Love Home Mart, and Panda Mart, which are attracting value-driven shoppers amid reduced disposable incomes.
Carrefour, traditionally associated with premium shopping malls, has begun expanding into middle-income areas, including Ruai, signalling a strategic repositioning. By December 2025, Carrefour Kenya had grown to 34 stores nationwide, with key openings at Waris Mall in Ruai, Beacon Mall in Upperhill, Ayden Plaza in Ngara, and Parkview Mall in Parklands.
Naivas reinforced its dominance by store count, closing 2025 with 113 outlets after new openings at Westbay Mall in Gachie, OUR Mall on Magadi Road, Mihango on Kigwathi Road, and Athi River.
Quickmart also accelerated growth, launching its 63rd store at Basic Mall on Banana Road in Ruaka. Meanwhile, Global Supermart entered the market with its first outlet at Crystal Rivers Mall in Athi River.
The report describes 2025 as a mixed year for retail real estate — resilient expansion by anchor tenants contrasted with consumer spending pressures linked to high taxes and constrained incomes.
“Footfall rose across major centres during the festive season, confirming the continued relevance of physical retail for peak shopping periods, but high taxes and constrained disposable incomes kept spending value-driven,” the report notes.
To remain competitive, leading chains intensified promotions, expanded local sourcing, and sharpened value positioning strategies. Mall performance increasingly depended on anchor tenants such as Naivas, Quickmart, Carrefour, and Chandarana Food Plus to draw shoppers, indirectly supporting smaller retailers within the same complexes.
Analysts say the shift to neighbourhood centres reflects a structural evolution in Kenya’s retail market. With urban sprawl expanding residential estates beyond traditional commercial hubs, proximity and affordability are becoming stronger drivers of foot traffic than prestige locations.
As 2026 approaches, the sector is expected to see deeper penetration into underserved estates, smaller-format stores, and further integration of discount retail models — signalling a more community-focused era for Kenya’s supermarket industry.
