Retail collapses trigger £1bn losses for Crown Estate

The value of Britain’s largest landowner has fallen by £1.3bn to £6bn in the year to the end of March, partly due to empty property as retailers collapse.

The Crown Estate owns the site formerly occupied by Tower Records on Piccadilly Circus, London, which was later rented by now defunct entertainment retailer Zavvi. Since Zavvi fell into administration in December the shop has remained vacant.

The Crown Estate has also faced difficulties over another of its stores in Piccadilly Circus, the former Virgin Megastore at the top of Haymarket. As revealed by Retail Week in April, the landlord rejected discount fashion brand TK Maxx from opening a store there on the grounds that it was “not posh enough”, since when it has agreed to allow souvenir store Cool Britannia to take the unit.

According to The Telegraph, the accounts show that the Shires Retail Park in Leamington, which the Crown Estate has a 50 per cent stake in, is also suffering.

The Estate also owns the Debenhams store in Worcester, as well as forests, harbours and fast-food shops.

Analysts and a spokesperson for the Estate did say that the Crowns Estate had fared better than most property firms.

A spokesman for Crown Estate told Retail Week: “The decrease in our portfolio value has been predominantly the result of the decline of capital markets, rather than deterioration in occupational markets. Our performance in the retail sector has held up extremely well during the recession. Our retail holdings contributed £72.9 million in revenue, up from £69.7 million or 4.4% in 2008.”

He added that Regent Street “continues to perform well in terms of both occupancy and revenue contribution” and that “our voids on the street stand at just under 3%”.

He also pointed out Crown Estate only owns the freehold on the former Tower Records store therefore the “impact on our bottom line is extremely small”.