The Crown Estate has reported record profits for the year ending March 31st. Profits rose from £210.7 million to 230.9 million, with much of this increase being due to increased rents and interest income.
Apparently this has been an extremely good year for the Crown Estate, and although changes are being proposed to the way royal finances are organized, it’s not really anticipated that this will have any significant effect.
Under the proposed changes outlined by Chancellor of the Exchequer, George Osborne last week, the governments would pay 15% of profits from the Crown Estate directly to the monarch. This would simplify the current system of payments.
Last year’s higher profits were partly due to interest on the income raised on sale of assets, which included the sale of four affordable housing projects in London for around £140 million. Another transaction which included the £443 million sale of a 25% stake in London’s Regent Street wasn’t included in this year’s report as the deal was completed one day after the current fiscal year ended.
The Crown Estate also plans to invest £1 billion into Regent Street, to help promote the street as a premier shopping area.
Profit from sale of assets is kept and re-invested, and purchases last year included retail parks and shopping malls in Liverpool, Oxford, Portsmouth and Nottingham. The purchase of these assets helped boost rental income. The Crown Estate can only buy UK real estate and government bonds, and is not permitted to borrow money.
The Crown Estate is a London based corporation which dates back to 1760, when George III agreed that Crown lands would be managed on behalf of the government, with surplus revenue going to the Treasury for the benefit of UK taxpayers. It was agreed that the king would receive a fixed annual payment, which is effectively the civil list.