The Crown Estate returned more than a third of a billion pounds to the Treasury last year, according to its latest set of accounts.
The real estate business, created by an Act of Parliament and owned by the Queen, is now responsible for a £14.3 billion real estate portfolio – up 1.7 per cent in value on the previous year.
The annual accounts say it has outperfomed the market for the 11th year in a row, despite the value of its property portfolio outside the capital dropping.
The figures were somewhat overshadowed this morning, though, by reports the Sovereign Grant – funded by profits from the Crown Estate – spent £2.4 million of taxpayers money renovating Frogmore Cottage, in Windsor, home of the Duke and Duchess of Sussex.
Assets owned by the Crown Estate include the 15,800 acre Windsor Estate, iconic central London areas including Regent Street, prime retail estate such as Fosse Park in Leicester and Racecourse Retail Park in Aintree, as well as offshore windfarms and the seabed around England, Wales and Northern Ireland.
During the financial year it returned £343.5 million to the Treasury, up 4.3 per cent on the previous year.
It means the total given back to the public finances over the past decade equals around £2.8 billion.
Today’s accounts show overall performance was ahead of the market, with a total return of 4.9 per cent, which was also ahead of an annual benchmark of 3.1 per cent.
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That outperformance was driven by the growth of its offshore wind business along with acquisitions and asset management in central London.
Chief executive Dame Alison Nimmo DBE, who steps down from the job later this year, said it came despite challenging market conditions, and they were now gearing up for the future.
She said: “We see profound changes taking place in our markets and in the world around us.
“It’s clear that the commercial property sector is changing, and changing at pace.
“There is no doubt that the future will look very different from the past, as digital technology, evolving consumer preferences and societal trends continue to have a significant impact on commercial real estate.
“As a forward-looking business that genuinely thinks long term, we know we must keep evolving so we stay relevant – meeting the changing needs of our customers and of society.
“This year we’ve challenged ourselves to think deeply about the future of our business and our competitive advantage.
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“As a result, we are developing a strategy which will put us on the path to transforming the business from its traditional landlord/tenant roots to become one centred on real estate as a service.”
The Crown Estate completed £720.3 million of sales, purchases and capital expenditure during the year.
It invested £282.2 million in the West End, and said a £1.1 billion Central London development pipeline had the potential to deliver up to 850,000 sq ft of space over the next five years.
It also launched The Marq, a 46,000 sq ft mixed-use scheme in Jermyn Street, and the only new office-led development to be delivered in St James’s in 2019.
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Some 14 permanent new retailers joined Regent Street and St James’s, including H&M Home – the seventh H&M brand in Regent Street – and Sandro Menswear.
With its Regent Street partners, Norges Bank Investment Management, it invested more than £230 million in three Central London acquisitions – the headlease acquisition of 30 Warwick Street and 61-65 Conduit Street, and the freehold acquisition of 56-60 Conduit Street.
Out in the regions, it completed 210,000 sq ft of new space at its £218 million retail and leisure destination Rushden Lakes in Northamptonshire, and agreed to buy a further 54 acres of land next door.
Meanwhile work is underway on the £168 million extension to Fosse Park, near junction 21 of the M1 in Leicester, which will increase its size by 40 per cent, and make it the 海角视频’s biggest retail park.
The extension is set to open in 2020.
Through the year it made more than 460,000 sq ft of new lettings across the 海角视频, to 130 customers, with rental income totalling £20.2 million a year.
However its regional portfolio shank in value by 7 per cent, reflecting the “increasingly challenging occupational and investment markets”.
The Crown Estate’s offshore wind farms supplied the electricity needs of 6.6 million homes.
Windsor Estate also had a busy year, welcoming more than six million visitors while hosting two royal weddings.
Robin Budenberg, chairman of The Crown Estate said it was “another year of strong returns to the Treasury and for the nation’s finances”.
He said: “Looking through short-term volatility in our markets, we remain focused on planning for the future to shape a business that creates value for customers in new ways and seizes the opportunities presented by the macro trends that are transforming how people use real estate.”