Metro Holdings Limited Announces Divestment of Retail Property in Western Australia

Key Highlights

• Divestment of Dalyellup Shopping Centre in Western Australia for A\$35.8 million (S\$30.4 million).
• Portfolio Reconstitution and Capital Recycling: The move aligns with Metro’s strategy to optimize its property portfolio and redeploy capital into higher-growth opportunities.
• Strategic Shift: Increased focus on Australia’s eastern seaboard, with reduced exposure to Western Australia, following the recent acquisition of a prime office asset in Sydney.
• Minimal Financial Impact: The transaction is not expected to significantly affect Metro’s net tangible assets or earnings per share for FY2026.
• Metro’s Share of Net Proceeds: Estimated at approximately A\$4.8 million (S\$4.1 million).
• No Director or Major Shareholder Interest: The divestment is an arm’s-length transaction with no conflict of interest.

In-Depth Details for Investors

Background of the Portfolio

Metro Holdings Limited (“Metro”), together with its subsidiaries (“Metro Group”), holds a 30% stake in a quality portfolio of 18 freehold properties in Australia, with Sim Lian Group holding the remaining 70%. Metro’s interest is structured through its units in SLH Property Trust, Sim Lian Property Trust, and Sim Lian Property Trust II, as well as a 30% stake in Sim Lian – Metro Capital Pte. Ltd. (“SLMC”), the asset and investment manager.

As of 31 March 2025, the portfolio comprised 5 office buildings and 13 retail centres, valued at approximately A\$1,396 million (S\$1,178 million), with a net lettable area (NLA) of 176,279 sqm, and a high occupancy rate of 92.9% with a weighted average lease expiry (WALE) by income of 5.0 years.

Details of the Divestment

The divested asset is Dalyellup Shopping Centre, a freehold neighbourhood shopping centre located at 54 Tiffany Centre, Dalyellup, Western Australia, with a net lettable area of 6,468 sqm. The property was owned via a trust structure under Sim Lian Property Trust II and was its only retail asset in Western Australia.

On 6 November 2025, SLMC Property Australia Pty Ltd, acting as trustee for SLG Dalyellup Trust, completed the sale of the property to an independent third party for a gross consideration of A\$35.8 million (S\$30.4 million). After accounting for selling costs, incentives, capital gains tax, and loan repayment, the estimated net proceeds are A\$16 million (S\$13.6 million), with Metro’s 30% share amounting to A\$4.8 million (S\$4.1 million).

Strategic Rationale and Portfolio Impact

The transaction is part of a broader strategy of portfolio reconstitution and capital recycling by SLMC. It coincides with the acquisition of the freehold prime office building at 1 Castlereagh Street, Sydney in October 2024. This recalibration moves the investment focus to Australia’s eastern seaboard, a region with more robust economic prospects, while reducing concentration risk in Western Australia.

Following the divestment, the joint Metro-Sim Lian Australia portfolio now consists of 17 freehold properties (5 office buildings, 12 retail centres), valued at approximately A\$1,361 million and spanning 169,811 sqm NLA across New South Wales, Victoria, Queensland, and Western Australia.

The divestment proceeds are intended for general corporate purposes, including the repayment of bank borrowings and possible return of capital to shareholders.

Financial Effects and Shareholder Impact

Importantly, the sale is not expected to have a significant impact on Metro Group’s consolidated net tangible assets per share or consolidated earnings per share for FY2026. This signals stability in the group’s financials despite the portfolio shift.

There are no related-party transactions or conflicts of interest—directors and controlling shareholders have no direct or indirect interest in the divestment outside their shareholding in Metro.

Summary of Remaining Portfolio

The portfolio now features a diversified mix of high-quality assets across Australia’s key cities:

• Office Buildings: Sydney, Melbourne, Brisbane, Perth (WA)
• Retail Centres: New South Wales, Victoria, Queensland
• Notable assets include 1 Castlereagh Street (Sydney), 390 St Kilda Road (Melbourne), Town Square Redbank Plains (QLD), and Shepparton Marketplace (VIC).
• Total NLA: 169,811 sqm

Potential Market Sensitivity

• The divestment and redeployment of capital align with Metro’s strategy to focus on higher-growth regions and assets, potentially enhancing long-term shareholder value.
• Although the financial impact is stated as minimal, investors should monitor subsequent capital allocation, including possible capital returns or debt reduction, as these could affect future earnings and share price stability.
• The strategic shift away from Western Australia towards the eastern seaboard may position Metro for better growth prospects in the Australian property market.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own research or consult professional advisers before making investment decisions. The information is based on Metro Holdings Limited’s announcement dated 6 November 2025 and is subject to change or updates by the company.

View Metro Historical chart here