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Metro acquires 17th property in Australia; makes four PBSA acquisitions in the UK

Felicia Tan
Felicia Tan10/3/2022 07:48 PM GMT+08  • 4 min read
Metro acquires 17th property in Australia; makes four PBSA acquisitions in the UK
Iron Bridge Studios, one of the PBSAs acquired in Exeter, UK. Photo: Metro
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Mainboard-listed Metro Holdings has made several acquisitions in Australia, the UK and Singapore, deepening its presence in these markets.

Acquisition of 17th property in Victoria, Australia

In Australia, Metro, together with its joint venture (JV) partner, Sim Lian Group, acquired a neighbourhood retail centre, Shepparton Marketplace, in the state of Victoria. The retail centre was acquired for a total consideration of A$92.0 million ($85.7 million). The acquisition was legally completed on Sept 30.

Metro’s capital commitment for the investment is approximately A$11.6 million.

The property is a freehold property with a total gross lettable area (GLA) of 16,535 sqm (177,981.26 sq ft). It is located about 190 km north of the Melbourne CBD at 110-120 Benalla Road. The property is anchored by Big W, Woolworths, 36 specialty tenants, five kiosks and one Caltex station. It has an occupancy rate of 97.3% and a weighted average lease expiry (WALE) of 4.1 years by income.

Following the acquisition, the Metro group and Sim Lian will hold a total of 17 quality freehold properties in Australia. The properties comprise four office buildings and 13 retail centres across four states, New South Wales, Victoria, Queensland and Western Australia. The properties have a total appraised value of A$1.2 billion. The portfolio has a high committed average occupancy of 95.1% and a WALE of approximately 6.1 years.

See also: Frasers Property sees P/NAV narrow with higher net profit and Frasers Property Capital

Acquisition of four PBSAs in the UK

In the UK, Metro, through its student accommodation fund, Paideia Capital UK Trust, acquired four purpose-built student accommodations (PBSAs) in Exeter, Durham, Glasgow and Kingston in May. The four properties were purchased for a total consideration of GBP74.4 million ($119.0 million).

Paideia Capital UK Trust is 30% owned by Sun Capital Assets, a wholly-owned subsidiary of the group. The remaining 70% in the trust is held by Lee Kim Tah Holdings Limited, Aurum Investments (Private) Limited (Aurum) and a third party. Aurum is a direct wholly-owned subsidiary of Woh Hup Holdings.

See also: Perennial Holdings secures $3 bil green loan to refinance 8 Shenton Way

The property in Exeter is located on the Western fringe of Exeter city centre, 5 minutes’ walk to Exeter Central train station. It was completed in 2012 and has 129 beds with reception, communal areas, central courtyard and a laundry room. The property has an occupancy rate of 99%.

The Durham property is located in Gilesgate, to the east of Durham city centre, around 1.8 kilometres from the train station. The property was completed in 2016 and comprises 109 self-contained studios plus reception, office and various communal areas for the students. The property has an occupancy rate of 100%.

The Glasgow property is a five-minute walk away from Glasgow Caledonian University and the Royal Conservatoire of Scotland and a 10-minute walk from the University of Strathclyde. The 140-bed property was converted from a former hotel. It has two commercial units comprising a convenience store and a restaurant, as well as “good communal facilities”. The property has an occupancy rate of 100%.

The property in Kingston is located on Penrhyn Road, approximately half a mile south of the centre of Kingston. Completed in 2017, the 89-bed property has a retail space and is currently undergoing fire safety remediation works in addition to a refurbishment of the internal bedspaces. It is operating at a reduced capacity. O

Together with the two existing properties of Red Queen, Warwick, and Dean Street Works, Bristol, Metro has a total portfolio of six freehold PBSA properties valued at GBP130.0 million. The group’s UK portfolio has a committed average occupancy rate of 99.2% as at June 30.

“The completion of these four acquisitions during this volatile period is testament to the capability of the joint venture partners. These acquisitions mark Metro’s continued strategic partnership with Lee Kim Tah Holdings Limited and Woh Hup Holdings Pte Ltd to further diversify for resilience in the UK,” says Metro’s group CEO Yip Hoong Mun.

Shares in Metro closed 1 cent lower or 1.48% down at 66.5 cents on Oct 3.

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