Grosvenor Group’s profits drop but dividends rise

The profits at the Duke’s vast estate empire dropped sharply in the last year. However, the dividends paid to King’s Godson and his family increased to nearly £50 million.

Grosvenor Group – which manages a portfolio of assets worth billions of pounds, including its 300-acre estate located in London’s West End – made a profit before tax of £110.4 in 2022. This was 75 percent less than the £437.5 in the year prior.

The company’s buildings enjoyed a rebound in value after the pandemic that did not occur last year. The value of the company’s portfolio was largely unchanged at £9 billion. This is due to the fact that the office valuation drops were offset by the increases in its flats and shops, as well as its farmland.

Grosvenor’s revenue profits, or profits that do not include valuation changes, have almost been halved from £99.7million in 2021 to £52.7million. The company blamed a series of one-offs for the decline, including the sale a large industrial park in West Midlands that inflated performance the previous year.

Mark Preston, the chief executive of the group, stated that “despite challenging economic conditions, we delivered a solid financial performance”, which was in line with his expectations and those of his team.

In order to reflect this, the board has paid a PS49.9m dividend, which is above the £47.8m it paid in 2021. In the middle of the pandemic in 2020, the board cut the dividend to £32.2million.

The Grosvenor Group has owned about 300 acres in Mayfair, Belgravia and other areas of London since the 16th century. It also owns Liverpool One, as well as property worth billions of dollars outside of the UK. Nearly half of the company’s portfolio is located overseas.

Grosvenor manages properties from 96,000 acres of Sutherland up to 300 acres of West End for Duke of Westminster’s Trusts

Hugh Grosvenor the 7th Duchess of Westminster is one of the trusts that own the group. He is now 32 and inherited his father’s title in 2016 when he died.

The future of offices and shops has been discussed a lot, particularly after the pandemic, with the rise of online shopping and home-working.

Preston, 55, however, stated that Grosvenor benefited from the “flight towards quality” which has been evident across all commercial properties in recent times.

He said, “We’re now seeing this polarisation of the best and the others.” “Those buildings that are up to standard are attracting lots of interest, high rents and high occupancy. “Those that are not up to scratch are quite different.”

He highlighted Holbein Gardens, Grosvenor’s first net zero office block in Belgravia, central London. We’ve achieved rents that were above our expectations in this building thanks to its energy-efficiency. Sustainability is not just about costs, but also a key business driver.

Grosvenor is a property developer and has made investments in buildings overseas, including student housing in Brazil and laboratories in Australia.

It invested £300 million in such deals last fiscal year, and plans to spend another £750 million within the next five-year period.

Grosvenor also invests heavily in its agricultural and food technology business. This includes stakes in vertical farming, alternative meat producers, and woodlands.

It owns stakes or shares in 28 companies, including the meal-kit retailer Gousto. It made £111million in such investments by 2022.