King Charles could be paying more than £278,000 per year to cover the rents of Princesses Beatrice and Eugenie’s accommodation in royal palaces, a valuer has estimated.
Both Andrew Mountbatten-Windsor’s daughters are non-working royals, but maintain residences in St James’s Palace and Kensington Palace, according to a new audit published on Friday.
The report, published by the National Audit Office (NAO), said the rents were discounted to around 60 per cent of open market prices because the Royal Household properties require tenants with security clearance. It did not reveal the figures the King is paying.
It also found that for a number of years, these adjusted rents were based on out-of-date open market valuations.
Princess Beatrice has a property in St James’s Palace, and Princess Eugenie has Ivy Cottage at Kensington Palace. Both of these are covered by the privy purse, which is King Charles’ private money, according to the report.
Andrew Mountbatten-Windsor received an undisclosed private income from subletting three cottages (PA)
Robin Edwards, a property buying agent at Curetons, told The Independent the “prestigious” locations and associations of the two properties mean they would attract “significant premiums”.
When adjusted for the discount afforded to the King, it is estimated this could equal more than £278,000 in rent per year.
Mr Edwards said open market rents for a property comparable to Ivy Cottage could range from around £10,000 to £15,000 per month.
“The Kensington location alone commands substantial rents, while the palace setting would make it one of London’s most unusual and desirable residential addresses,” he explained.
The NAO report shows Princess Eugenie’s rent is currently at 64 per cent of the 2026 open market valuation. Calculated from Mr Edwards’ assessment, this suggests the King could be paying up to around £9,600 per month in rent for Ivy Cottage.
Sarah Ferguson with Beatrice and Eugenie (PA)
Princess Beatrice’s apartment in Kensington Palace was given an open market valuation of around £15,000 to £20,000 by Mr Edwards. The report shows Princess Beatrice’s rent is currently at 68 per cent of its market value, suggesting the King could be paying up to £13,600 per month.
“St James’s Palace sits in one of the most exclusive parts of central London,” Mr Edwards said. “A private three-bedroom apartment of reasonable size within the palace grounds could realistically attract rents of £15,000 to £20,000+ per month if ever offered on the open market.
“The combination of royal heritage, security and a location moments from Green Park and Mayfair would place it among the capital’s most prestigious residential addresses.”
He added there are “very few comparable properties” in the country that makes valuation “difficult”.
“However, this scarcity also means these properties could command significant premiums over otherwise similar homes nearby,” he said.
Princess Beatrice also owns a property in the Cotswolds, while Princess Eugenie has a primary residence in Portugal.
(PA Graphics) (PA)
Former Liberal Democrat minister Norman Baker, who has long been a critic of royal finances, said there is “no way that non-working members of the royal family should be subsidised by the Duchy of Lancaster”.
He added: “The royal family is yet again taking the public for a complete ride.”
Up until this year, Eugenie’s rent of Ivy Cottage in Kensington Palace was based on a 2018 valuation and Beatrice’s apartment in St James’s Palace on a 2020 valuation.
But both rents are paid to the Royal Household entirely by Charles out of the Privy Purse, which is made up of his Duchy of Lancaster income and other private funds.
For the properties rented to Beatrice and Eugenie, rent paid by the King is said to cover maintenance and operational costs met by the Sovereign Grant for the homes, with no additional cost to the grant as a result.
St James’s Palace in London (PA)
The Sovereign Grant, which pays for the royal family’s official duties and the upkeep of royal palaces, is met from public funds in exchange for the King’s surrender of the revenue from the Crown Estate.
The princesses faced scrutiny when their names appeared in the recent Jeffrey Epstein files, with one email exchange suggesting their mother Sarah Ferguson took them to see the convicted paedophile in the US days after he was released from prison for child sex crimes.
It is understood that the arrangements were put in place by the late Queen Elizabeth II for her granddaughters, and Charles continued paying for their rent at his discretion when he became King.
Financial matters at the Royal Household are, however, kept under regular review.
Eugenie is said to have carried out refurbishments at Ivy Cottage at her own expense.
The sisters lived together at St James’s Palace from 2008 before Eugenie moved to Kensington Palace in 2018.
A spokesperson for the crown estate, said: “The Crown Estate welcomes the National Audit Office‘s review which confirms its leases with members of the royal family were agreed in line with independent, professional advice and open market valuations.
“We look forward to discussing the report further with the Public Accounts Committee in due course.”
A Buckingham Palace spokesperson said: “We are grateful to the National Audit Office for this report, which is in line with the royal household’s commitment to transparency.
“We hope that the findings will help correct, clarify or contextualise a number of points regarding royal properties.
“As the report notes, arrangements for properties managed by the royal household vary based on a number of factors to ensure residences are filled appropriately, depending on their location, tenants and purpose.”