Crown's estate suffers £1bn loss

Jul 9 2009 By The Journal

THE Queen's Crown Estate property empire has admitted that more than £1bn had been wiped from the value of its assets – the first decline since 1993.

The group – which dates back to 1066 and gives all its profits to the Treasury – saw £1.3bn knocked off the value of its estate, down to £6bn, which left it with operating losses of £1.08bn for the year to end of March.

But the Crown Estate, which owns landmarks such as London’s Regent Street, said the property slump had not impacted Treasury revenues.

The taxpayer will benefit from a net surplus of £226.5m – up 6.1% on the previous year – after revenues lifted by 7.1%.

Roger Bright, chief executive of the Crown Estate, said the group had not been "immune" to the global crisis.

He said: "We have had to contend with a number of difficult circumstances, including tenant defaults."

Total return performance dropped 15.8%, although this outperformed a wider 25.5% plunge in the property sector as a whole, according to the group.

The Estate’s full-year figures show that its urban properties were worst affected by the market woes, with a 21.4% drop in value.

The group’s finance director John Lelliot said they were braced for "another tough year", with rents falling and not likely to pick up until 2011/12.

Its urban interests also span retail parks and shopping centres, including a recently-bought 50% stake in the Crown Point Shopping Park in Leeds.