Royal Property Report Reveals Andrew Lease Income

A newly released report by the National Audit Office (NAO) has revealed that Andrew Mountbatten-Windsor received rental income from three cottages located on the Royal Lodge estate, which he was permitted to sub-let under the terms of his lease with the Crown Estate.

The report, which marks the first comprehensive review of royal residences in two decades, also disclosed that King Charles covers the rental costs of accommodation occupied by Princess Beatrice and Princess Eugenie within royal palaces, despite neither carrying out official royal duties.

According to the findings, Mountbatten-Windsor, his family, and associated staff had access to a total of 12 properties owned either by the Crown Estate or managed by the Royal Household.

Buckingham Palace welcomed the publication of the report, describing it as consistent with the Royal Household’s commitment to greater transparency regarding royal finances and property arrangements.

The NAO noted that when Mountbatten-Windsor took over the lease of Royal Lodge, he contributed approximately £7.5 million towards extensive refurbishment and repair work. As part of that arrangement, he was not required to make ongoing rental payments for the property.

The report also highlighted housing arrangements involving his daughters. Princess Eugenie resides in accommodation within Kensington Palace, while Princess Beatrice has access to a residence in St James’s Palace.

Rather than paying rent themselves, the cost of these properties is met through the Privy Purse, the monarch’s private income, which is paid to the Royal Household.

Both Kensington Palace and St James’s Palace are maintained using public funds provided through the Sovereign Grant, which supports the official functions of the monarchy.

Critics have questioned whether such arrangements remain appropriate, particularly when they involve family members who are not engaged in official royal duties.

Former Home Office minister Norman Baker argued that providing luxury accommodation under these circumstances amounted to an unfair burden on the public and called for greater scrutiny of royal finances.

Palace sources, however, stated that rental payments made through the Privy Purse are intended to cover any public expenditure linked to the properties, ensuring that there is no additional cost to taxpayers through the Sovereign Grant.

The report does not disclose the exact rental value of the residences occupied by the princesses, although it notes that the rate is set at around 60% of market value.

The NAO investigation was commissioned following ongoing public interest in Mountbatten-Windsor’s financial arrangements and will be followed by further examination from Parliament’s Public Accounts Committee.

Although Mountbatten-Windsor moved out of Royal Lodge earlier this year and relocated to the Sandringham estate in Norfolk, he continues to hold the lease on the Windsor property until October 2026.

The report makes clear that there is no indication of wrongdoing by Mountbatten-Windsor.

In addition to the main Royal Lodge residence, the lease included eight surrounding properties. Under the agreement, three cottages could be rented out to third parties, and these were sub-let until April 2026.

While the report confirms that rental income was generated, it does not specify the amount received. Palace sources indicated that the cottages were primarily occupied by staff or retired employees and that the income was used to offset maintenance and operational expenses.

Any revenue generated from the rentals was retained by Mountbatten-Windsor rather than being returned to the Crown Estate, whose profits are ultimately transferred to the UK Treasury.

The report also references a separate lease held by Mountbatten-Windsor for East Lodge, a property expected to be returned to the Crown Estate.

Beyond their royal residences, Princess Beatrice and Princess Eugenie are reported to have homes in both the Cotswolds and Portugal.

Elsewhere, the NAO found that the Crown Estate spent nearly £400,000 on repairs and refurbishment work at Forest Lodge before the Prince and Princess of Wales moved into the property.

Princess Michael of Kent, another non-working member of the royal family, also occupies accommodation within Kensington Palace that is funded through the Privy Purse.

The report outlines that 11 working members of the Royal Family receive accommodation within royal palaces without charge as part of their official responsibilities. These include the King and Queen, the Princess Royal, the Duke and Duchess of Edinburgh, the Duke and Duchess of Gloucester, the Duke of Kent, Princess Alexandra, and the Prince and Princess of Wales.

In addition, 21 royal office holders, including several military knights, are provided with accommodation within occupied palace grounds.

The NAO emphasized that its report was intended to establish facts and explain existing arrangements rather than reach conclusions about value for money or policy.

Lee Summerfield, a director at the NAO, said the review focused on documenting how property agreements are managed between the Crown Estate and the Royal Household.

Buckingham Palace expressed appreciation for the report and said it hoped the findings would provide greater context and clarity regarding the management of royal residences.

The Crown Estate also welcomed the review, stating that all lease agreements involving members of the Royal Family were established according to independent professional advice and market-based valuations.

Former Public Accounts Committee chair Baroness Margaret Hodge questioned the lack of transparency surrounding the rental income received from the cottages and raised concerns about public support for housing occupied by non-working royals.

She argued that the Crown Estate ultimately serves the public interest and that any arrangements involving public assets should be carefully scrutinized to ensure value for taxpayers.