Duchy benefits from uplift in value
THE Duchy of Lancaster saw the value of its estate increase by 10% in the year to March 31 to £383.2m.
The estate is owned by Her Majesty The Queen and provides a separate income which is independent from the Government and the public purse. It is not part of the Crown Estate.
It owns more than 18,200 hectares of mainly rural land, including 4,650 hectares in Lancashire between Preston and Lancaster, 2,000 hectares between Crewe and the M6 in Cheshire, 6,920 hectares between Pickering and Scarborough in North Yorkshire and 3,000 hectares at Needwood in Staffordshire.
It also owns a small urban estate in central London on the site of the former Savoy Palace.
During the year, the company increased its net operating income by 7.9% to £13.9m and generated a net surplus of £13.3m.
An operating review prepared alongside the Duchy’s accounts prepared by the chief executive and clerk of the Duchy Council, Paul Clarke, said that the estate’s management had worked closely with tenants during “difficult economic circumstances” and helped to maintain them, where appropriate.
Over the past ten years, net income generated by the Duchy has grown by 110% and delivered a total of £108m to the Keeper of the Privy Purse. It has also built liquidity of around £59.7m which is available for it to make strategic purchases of land, should they arise.
“We are delighted that, in a gradually improving market, we have succeeded in increasing our net operating income by 7.9% and increasing our net asset value by 10%,” said Clarke.
“This was achieved through solid underlying results across all of the portfolios, with particularly strong income and capital growth within the agricultural portfolio.”
The report said that letting rural commercial space during a downturn had proved to be difficult. Although it increased occupancy at its Crewe Hall Buildings to 66%, the Root Hill Estate Yard at Whitewell in Lancashire has been slower to let despite winning awards for its conversion.
The Duchy is also progressing with two rural development schemes at Crewe Green in Cheshire and Cloughton in Yorkshire. The latter includes a ‘masterplan’ for 155 new homes, four live/work units, a shop/post office, café, doctor’s surgery, pre-school and community space.
Clarke said that it was working with parish councils in both areas to ensure development is of a sympathetic scale and adds sustainable amenities.
“Both schemes are about to be submitted for planning and we hope that our proposals are accepted by those who are charged with determining the future of our rural built environment.”
Moreover, the Duchy’s Housing Trust set up to provide more affordable housing units in rural areas also recently committed £2m to its first project in the Lancashire village of Dunsop Bridge.
Clarke said the Duchy had continued to improve the quality and mix of its portfolio.
“The levels of returns seen during the early part of the last decade will not be repeated during the next five years, but we are confident that we will continue to see strong financial performance and enhanced asset quality across all our estates,” he added.
