SINGAPORE - Property and retail group Metro Holdings has diversified its portfolio to new investment assets while deepening its property and development holdings in key markets.
The mainboard-listed company, which started out in 1957 as a textile shop at 72 High Street, currently holds total assets of $2.5 billion, according to its latest financial statements for the six months ended Sept 30, 2021.
Its property assets currently comprise 97 per cent of its holdings, with retail making up 3 per cent.
Metro signed a memorandum of understanding on Jan 12 with Daiwa House Industry to invest in logistics and commercial facilities, and housing or other asset classes in Japan, Singapore and the Asia-Pacific region, but with a view to expand to other regions in the future.
This follows Metro Holdings' cornerstone investment in Daiwa House Logistics Trust (DHLT) on Nov 26 last year. Metro subscribed to 51,625,000 units amounting to approximately 7.65 per cent of the total issued units in DHLT for a total consideration of approximately $41.3 million.
Speaking to The Straits Times, Metro group chief executive Yip Hoong Mun emphasised the importance of investing in logistics, a shift that occurred during the Covid-19 pandemic.
He said: "The demand for warehousing has spiked due to Covid-19 with the restrictions on flights and cargo.
"As cargo movement is no longer as smooth, there is now more demand for storage spaces, making logistics a good area of investment."
In December 2020, Metro also acquired a 26 per cent stake in a portfolio of 14 industrial and logistics properties in Singapore for up to $76.6 million.
This comprised six industrial properties, one business park, four high-spec industrial properties and three logistics properties.
In October last year, Metro acquired the 15th property in its Singapore portfolio, 351 Braddell Road via the Boustead Industrial Fund (BIF).
In the wake of Covid-19, Metro also diversified many of its investments in its key markets - namely Britain, Australia, China, Indonesia and Singapore.
In January last year, it picked up a six-storey student dormitory near the University of Bristol for £30.1 million (S$55 million), purchased through Paideia Capital UK Trust.
"As it can be more difficult to find jobs during the pandemic, we predicted that more people might take this time to pursue their studies instead, hence we decided to invest in student accommodation," said Mr Yip.
The trust - set up with an initial committed capital of £60 million to acquire student accommodation properties in Britain - is a joint venture between Metro subsidiary Sun Capital Assets, property player Lee Kim Tah Holdings, and construction group Woh Hup Holdings' subsidiary Aurum Investments.
Metro engaged Ascott to manage more than 200 units across two floors of student accommodation and three floors of corporate leases that are part of the M+ service residences in Trans Park Bekasi, Jakarta, Indonesia.
It also acquired Cherrybrook Village Shopping Centre in New South Wales, Australia in 2021 for about A$132.8 million (S$128 million) with joint venture partner Sim Lian.
"Covid-19 changed the way we diversify our portfolio... We are trying to expand our presence to acquire more properties during the pandemic despite difficulties in travelling," said Mr Yip.
"We also hope to invest more in Japan," he added.
On the retail front, the group, which marks its 65th anniversary on March 8, is on the lookout for investment opportunities in e-commerce. This is in keeping with people's changing demand and shopping habits, particularly since the pandemic, said Mr Yip.
It has no plans for new retail outlets in 2022 and will focus on improving operations in its two existing outlets in Paragon and Causeway Point.