This looks like an interaction between the catalog-managed protocol upgrade and VARIANT shredding, rather than an issue with the SQL syntax itself.

delta.feature.catalogManaged needs to be enabled as a standalone table/protocol upgrade. In this case, Databricks also appears to be carrying delta.enableVariantShredding=true into the same metadata change because the table contains VARIANT, which causes:

DELTA_CATALOG_MANAGED_TABLE_UPGRADE_WITH_OTHER_PROPERTIES

I would first check the current state:

DESCRIBE DETAIL catalog.schema.table;
SHOW TBLPROPERTIES catalog.schema.table;
DESCRIBE HISTORY catalog.schema.table;

Then, on a test/non-production table, try temporarily disabling variant shredding:

ALTER TABLE catalog.schema.table
SET TBLPROPERTIES ('delta.enableVariantShredding' = 'false');

Then run the catalog-managed upgrade separately:

ALTER TABLE catalog.schema.table
SET TBLPROPERTIES ('delta.feature.catalogManaged' = 'supported');

If the error still references enableVariantShredding, it may be necessary to remove the shredding table feature before the upgrade:

ALTER TABLE catalog.schema.table
DROP FEATURE "variantShredding";

Verify the exact feature name in DESCRIBE DETAIL first, since older/preview tables may expose a slightly different feature name.

After the catalog-managed upgrade succeeds, variant shredding can be enabled again:

ALTER TABLE catalog.schema.table
SET TBLPROPERTIES ('delta.enableVariantShredding' = 'true');

One other important check: upgrading an existing table to catalog-managed requires DBR 18.0+.

So I suspect this is currently an edge case in the upgrade path for tables combining Catalog Commits + VARIANT/Variant Shredding, rather than a problem with the documented ALTER TABLE statement itself.

If the same issue persists after removing shredding on DBR 18.0+, I would raise it with Databricks Support with the DESCRIBE DETAIL, table properties, runtime version, and table history.