Aberdeenshire president Alasdair Farquharson says the Woodside club will undertake a period of rebuilding after withdrawing from National 2.
Shire had been forced to forfeit their past three matches in the division after being unable to raise a team following the collapse of their collaboration with Aberdeen Grammar.
The SRU accepted the club’s request to withdraw from the league yesterday afternoon but Shire will continue to field a side in Caley 3 North.
Farquharson said: “It is disappointing that we have had to take this course of action.
“We had to be realistic and look at our player we had at our disposal.
“For too many of them, it would have been unfair to pitch them into a fixture at National 2 where they could have got hurt.
“We carried out a detailed assessment along with the SRU of our player strengths and how many would be available at National 2 level.
“We just didn’t have the numbers necessary to compete at that level.
“We will just put out one team for the rest of the season in Caley 3 North.”
The Aberdeenshire players were informed of the decision at training this week.
Farquharson added: “We had a club meeting on Monday where we informed players and members of where things were heading.
“We actually received some extremely positive feedback at the meeting with a lot of past players volunteering their services.
“We are now looking forward to a period of rebuilding.
“It will take time but it is a now a case of looking forward to the future.
“The short to medium term goal is going to be to compete in the Caley leagues and see where that takes us.
“Any club playing at national level has a huge commitment in terms of travelling and training.”
Head coach Craig Parslow will remain with the club.
Farquharson said the move would not have any major financial implications for the club.
He added: “We have had to review our projected budget for the coming season with this change in mind.
“We have had to take out certain income streams, such as participation money from the SRU.
“But there are also considerable cost savings, not least in the travel department.
“By going down to one side, we are not going to be in any financial difficulties.”
