Parts of Regent Street may be sold to investors if plans by the monarchy’s property manager, known as the Crown Estate, are fulfilled.
The monarchy’s real estate was handed over to the government in exchange for substantial yearly payments in 1760. Since then the buildings have been the freehold property of the Crown Estate, which manages the sites and their tenants.
Chief Executive Officer Roger Bright said it is sounding out possible investors, such as sovereign wealth funds and pension funds to assess demand for its largest asset. The plan is to raise the capital needed to redevelop Regent Street, which has over 350,000 square metres of retail and office space valued at £1.6 billion.
This is the second attempt by the Crown Estate to raise funds after a previous plan was quashed due to its complexity.
Bright said: “We are looking at more straightforward ways to include third-party capital. We are at the stage of expressions of interest; we haven’t yet got to the decision stage”.
As freeholder, the Crown Estate owns the Regent Street land. It has been suggested that one way of raising funds would be to sell the spot as a leasehold. A leaseholder would own the temporary right to the land whilst providing the freeholder with a regular rental income until the expiry of the lease. After that point the land would return to the Estate.
Bright said: “We are anxious not to lose control of Regent Street”.
The extra capital would go toward the Quadrant Project, which will create new Regent Street office space and retail stores as well as a five-star hotel on the former Cafe Royal site.