Emerging coffee shop Café Deli has said it will spend Sh315 million ($3 million) on expanding its outlets in the next three years, in a plan that will also see it enter major shopping malls.
The firm aims to increase its branches to six from the current three by the end of year, mainly taking space in high traffic locations.
The Café Deli restaurants chain is owned and managed by founder Obado Obadoh.
“We will spend a total of Sh315 million on the Kenyatta Avenue branch and three more before the end of next year,” said Mr Obadoh in a statement on Wednesday.
The venture will be funded through internal savings and borrowing from banks and development institutions.
Café Deli is expected to officially open its third outlet along Kenyatta Avenue on Friday.
The eatery, which he terms as “the biggest coffee house in Nairobi’s Central Business District”, has capacity to hold 250 people.
The coffee chain’s entrance into shopping malls will be tracing footsteps of rivals such as Java and KFC that have expanded their presence in key Nairobi malls.
“The plan is to also have a presence in Nairobi’s biggest malls,” said the company.
In July this year, Cafe Deli received a Sh100 million funding from South African venture fund, GroFin, to finance its expansion plans.
GroFin has been funding small and medium businesses with high growth potential across Africa and the Middle East. It was established in 2004 and has local teams in 14 offices across 12 countries.
GroFin Kenya’s Investment Executive, Rishi Khubchandani, said: “Café Deli is developing a distinctive brand identity in its unique positioning and quality offering to customers within the CBD. We are taking the right measures to cultivate a novel yet home-grown Kenyan brand in the food and beverage space that will be around for decades to come.”
Café Deli’s other branches are on Moi Avenue and Nkurumah Lane, behind Kencom building – the former Green Corner Restaurant. It started off as a small coffee house in Westlands, Nairobi.
Kenya’s middle class has in recent years embraced coffee shops, helping to rapidly grow players like Java House into a multimillion-shilling business.
Java House last year announced plans to invest between Sh400 million and Sh500 million to open new outlets.
The demand for coffee shops in Nairobi has attracted investors in the market seeking buyouts of rivals who operate similar enterprises. Last year, a Dormans coffee shop was bought out by rival Artcaffe which is seeking to increase its outlets in Nairobi and Mombasa.
The owners sold seven outlets for an undisclosed amount to focus on coffee processing and export. Artcaffe opened shop in Kenya in 2009.