The Crown Estate, an independent commercial business, created by Act of Parliament, has today announced another record return for the benefit of the public finances and an overall performance which is significantly ahead of the market, as its portfolio value hits an all-time high.
Results summary
Sir Stuart Hampson, Chairman of The Crown Estate said: “This year’s record profits as well as our outperformance of the market over the last three years prove that through our long term approach to investment and steadfast focus on our core sectors, The Crown Estate continues to be a remarkable UK success story.”
Alison Nimmo, Chief Executive of The Crown Estate said: “It’s been another fantastic year for The Crown Estate and with a portfolio now valued at close to £10 billion, this record performance shows that from the heartlands of our real estate business to our investment offshore, we’re truly at our best when we’re actively managing.”
Lord Deighton, Commercial Secretary to the Treasury said: “The long-term view taken by The Crown Estate has yielded another year of strong growth. This is a great British institution demonstrating careful stewardship and also creating value that goes beyond financial return.”
A strong asset base and business model
Capital market activity, the strategic use of partnerships, and a focus on key sectors are at the heart of The Crown Estate’s business model and investment strategy. Astute purchases have, in particular, strengthened the regional retail and rural portfolios, whilst the establishment and extension of strategic West End partnerships, together with the sale of non-core assets into strong investment markets, have been a key driver of total return outperformance.
Nearly £1 billion of capital activity comprised: £248 million of capital expenditure including development; £264 million of acquisitions; disposals totalling £457 million. Key acquisitions included:
Disposals included:
Active asset management grounded in place-making at its best
Active asset management and place-making underpin The Crown Estate’s strategy, driving capital values and rental growth. This has not only generated strong returns but also created world-renowned mixed use destinations for shopping, leisure and business, across the UK.
A landmark year for the offshore wind industry
The Crown Estate’s long-term investment and enabling role have helped ensure the UK remains the most attractive place to invest in offshore wind globally. Sector milestones included the opening of the world’s largest offshore wind farm, London Array, through to landmark investments from Siemens and AB Ports in manufacturing facilities on the Humber. As manager of the UK seabed, The Crown Estate is co-investing up to £100 million with developers, to de-risk projects by addressing technical, physical and environmental constraints. Key highlights for offshore wind in 2013/14 included: