In a Singapore Exchange filing on July 20, the retailer said it is “evaluating a range of other retail formats, including smaller-format stores, multi-specialty concept stores, curated retail experiences and pop-up store initiatives.” The company did not disclose when the leases are due to end, according to The Straits Times.
Metro said it is in talks with its current landlords, as well as other property owners, to introduce the new store concepts. The company plans to gradually shift away from its large-format department store model toward a more flexible approach in response to changing customer preferences.
The Paragon and Causeway Point outlets are Metro’s last remaining large-format department stores in Singapore, according to Channel News Asia. Its number of outlets in the city-state peaked at 11 in the early 2000s.
Metro Paragon, Singapore. Photo courtesy of Metro Singapore |
In a statement, group chief executive Yip Hoong Mun said the group’s new retail strategy “is designed to meet customers’ evolving expectations while having greater flexibility to introduce new concepts, brands and partnerships”.
Metro said it is still finalizing the rollout timeline for the new strategy and evaluating its financial impact, which it is not yet able to quantify. However, it does not expect the transition to materially affect its net assets or earnings per share for the financial year ending March 31, 2027.
CapitaLand Integrated Commercial Trust, which completed its acquisition of Paragon on July 1, said it plans to optimize and selectively reconfigure parts of the mall to strengthen its tenant mix and introduce new concepts and experiences, including in the areas currently occupied by Metro.
Metro said the move would better position the company to respond to evolving consumer preferences and opportunities in Singapore’s retail sector, which continues to face a challenging operating environment as inflationary pressures weigh on consumer sentiment.
In its results presentation for the year ended March 31, Metro said retail sales were expected to remain subdued, affecting the performance of its department stores at Paragon and Causeway Point, as well as its online platforms.
The retailer, which also operates a property business, previously reported that weaker sales at the two department stores reduced group revenue and contributed to another year of losses.
Metro was founded by Indonesian businessman Ong Tjoe Kim, who first established the business in Surabaya, Indonesia, in 1953. Its Singapore retail operation began in 1957, making it one of the country’s longest-established department-store names.
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