Crown Estate plans new vehicle for Regent estate

The Crown Estate, the company that owns the Sovereign’s land and property assets in the UK, is drawing up plans to create a new vehicle to control its £2.2bn (EUR 2.8bn) estate around Regent Street in London, according to a report in the Financial Times on Wednesday.

According to the newspaper, the Crown Estate is to announce plans for a feasibility study to explore options to bring in external finance to the vehicle, including a public floatation of a vehicle like a real estate investment trust (REIT). The funds would be used to finance future property investments, as well as to help fund an existing property portfolio in excess of £7bn, the newspaper said. The feasibility study is expected to be completed in 2009.

The Crown Estate's enormous property portfolio stretches across the UK and includes large amounts of commercial and residential property, more than 120,000 hectares of agricultural land, about half the foreshore and the seabed out to the 12-mile territorial limit. The Crown Estate does not have the ability to borrow funds and returns revenue surpluses to the public through the exchequer.

The latest part of its Regent Street estate is called the Quadrant project and is expected to win planning consent next month, the newspaper noted. The project would aim to redevelop and improve a one million sq ft (92,903 m2) space in the heart of the West End of London, as well as creating a 44,000 sq ft public area. The project is expected to have a value of more than £750mln upon completion.