He inherited the title and the family business worth £10 billion, but an exclusive Tatler investigation can reveal that the Duke of Westminster has almost no control over the wealth that defines him
Hugh Grosvenor, 7th Duke of Westminster, wears his wealth well. When he inherited his late father’s fortune of around £9.5bn last summer, he was variously described as Britain’s fifth richest man and the richest man in the world under 30. Fortune hunters were urged by tabloids to beat a path to his door. Yet they would have been disappointed, for one looks in vain for signs of profligacy or even a playboy lifestyle. Hughie, as he is known, spends a lot of his time behind a desk in the accounts department of a small London recycling company, plays a good game of cricket and still lives primarily at the family estate in Cheshire. The duke, 26, is a modest chap who refuses to let his riches define him, despite being the titular head of a family firm worth close to £10bn.
The Grosvenor Group has land holdings that include more than 1,500 properties in 60 countries. In London, it owns 50 per cent of Mayfair (including the freeholds of the American embassy, the Beaumont Hotel and the Gagosian Gallery) and 300 acres of Belgravia. It has the family’s Eaton Estate in Cheshire and the Abbeystead Estate in Lancashire. There are also estates in Scotland and Spain, and it virtually rebuilt Liverpool’s city centre. There is a shopping centre in Stockholm, a residential tower in Tokyo, a large chunk of Silicon Valley and all of Annacis Island, near Vancouver.But despite all this property, all this money, all this power, Hughie has almost no control over the company that bears his name.
In the Fifties, the Grosvenor family placed their main assets in a series of trusts to protect the estate from spendthrift heirs, disastrous divorce and other threats. According to Hugi Clarke, a director of the Foresight Group, an estate-planning firm, this means that the duke and his family receive the benefits but have no ‘absolute right’ to the assets. So if Hughie wanted to sell some juicy plum from the portfolio – say the freehold of the Beaumont Hotel – for some extra spending money, he would not be able to do it without the consent of the Grosvenor trustees. Currently there are seven trustees, including the duke. They are led by executive trustee Mark Preston, who is also day-to-day boss of the empire, and they would be very unlikely to agree to anything that could jeopardise the Grosvenors’ financial wellbeing.
Trusts ensure continuity, and most rich families use them – the Rothschilds are said to have a series of them controlling more than £40bn. It might be tempting to think of Hughie Grosvenor as master of all he surveys, but the way his predecessors arranged their affairs means it may even be technically incorrect to call him a billionaire. This makes him a thoroughly modern duke – the theoretical head of a vast family concern, but also his own man. Assisted by handpicked professionals, his late father ran the Grosvenor business for many years, but so far the 7th duke seems happy to let his dad’s team get on with it. This may be a good idea. Despite a severe chill in the London property market, mainly caused by Brexit uncertainty, the group posted revenue profits of £79.2m last year, slightly lower than the year before but better than had been feared. The duke and his family share an (undisclosed) slice of the spoils.Apart from Hughie, the main beneficiaries are his mother, Natalia, 58, usually called Tally – the duchess is a direct descendant of George II and remains the Duchess of Westminster until Hugh marries, when she will become dowager duchess – and his three sisters: Tamara, 37, who is married to Edward van Cutsem, of the Norfolk landowning family; Edwina, 35; and Viola, 24. Lady Edwina, an energetic campaigner for prison reform, is married to Dan Snow, the television presenter and historian, who cheerfully admits that his wife’s money means he doesn’t have to ‘grind it out’ with extra work such as speaking engagements, as many of his peers do. The ancient tradition of primogeniture allowed Hughie to succeed to the title, but Tatler can reveal that his sisters receive just as much as he does from the estate.
For his day job, the 7th duke works in the accounts department of Bio-Bean, a company headquartered in Borough that turns waste coffee grounds into biofuels. Bio-Bean’s Coffee Logs sell for £15.99 per bag on Amazon and burn with a pleasant coffee fragrance – ideal for the discerning woodstove owner. The company is currently working on technology to turn coffee grounds into a fuel for cars and lorries, prompting an in-house joke: ‘Wake up and smell the diesel.’ The fact that the duke has opted to do a regular job comes as no surprise to his friends. His father, Gerald, who was 64 when he collapsed during a walk on his Lancashire estate last August, had firm views about how he wanted his children to grow up. He once said of his son and heir: ‘He was born with the longest silver spoon anyone could have, but he can’t go through life sucking it.’
Hughie was sent to a state primary school in Eccleston, near Chester, and then boarded at Ellesmere College in Shropshire, a £31,000-a-year public school noted for its relaxed atmosphere. He did well academically, was made a prefect and head of house, and became a star batsman for the school’s cricket team. He went on to Newcastle University and gained a 2:1 in agriculture, becoming the first Duke of Westminster to secure a degree. At university, as at school, few knew his true background. Bella Eckert, who edited a campus website, says, ‘He seemed like a normal guy.’Indeed, when Hughie’s father threw a showy 21st-birthday bash (rumoured to have cost £5m) for him, many of his friends were shocked at the size and opulence of his family home. Belgrave Drive, the private road leading to the house, was lined with torches, and steak and chips was laid on for 800 guests in a giant marquee. Among the guests was Prince Harry, an old friend (like his late father, the duke is close the Royal Family; he is one of Prince George’s godparents).
The dress code for the party was ‘black tie and neon’, and comedian Michael McIntyre was reportedly paid £40,000 to crack the jokes. Hip-hop duo Rizzle Kicks provided the music. Jordan Stephens, one half of the duo, has given an intriguing insight, describing Hughie as ‘a really nice kid – it was mad seeing him in that space because the best thing about doing his 21st was that, amidst all this money and that heritage, he was so not like that. A lot of people at the party I talked to were, like, “This is crazy” and “Yeah, I just sat next to him in science and I had no idea.”’ Such personal suppression must have taken some psychological effort.
Still, one guest who did know all about Hughie was Harriet Tomlinson, a schoolfriend from Ellesmere College. Harriet, 26, has been Hughie’s on-off girlfriend for more than a decade. Her father, Grahame, 81, ran a family curtain-making business, Montgomery Tomlinson, that went into administration in 2013. Grahame and his wife, Louise, 55, live in a Victorian house on the banks of the River Dee in Chester, where Harriet and her sister Grace, 23, grew up. According to a Grosvenor Estate insider, Hughie is a frequent visitor to the Tomlinson home, where there’s a motorboat on a river mooring. Hughie and Harriet would take the boat along the river, through Chester and then south to the Eaton Estate and Hughie’s home, the source said.
The duke and Harriet split as an item more than a year ago but got back together after the death of his father. Now they are closer than ever, it seems, having taken a romantic holiday earlier this year in California, where they stayed at a luxury resort. Harriet did a teaching degree at Cardiff University but for the past two years has been a consultant with the City recruitment firm Deverell Smith. ‘Great fun and hardworking’ is how one colleague describes her.
Her romance with the 7th duke inevitably prompts speculation – will she be the next Duchess of Westminster? If so, home will be Eaton Hall, set in 11,000 acres near the village of Eccleston, an estate awarded to a Grosvenor ancestor by William the Conqueror.
The Grosvenors’ big break came in 1677, when Sir Thomas Grosvenor married the 12-year-old Mary Davies, an heiress who brought to the union the land that now comprises portions of Mayfair and Belgravia. Mayfair’s development began in 1720, Belgravia’s in the 1820s. The first duke, created by Queen Victoria in 1874, was MP for Chester for more than 20 years and built an enormous house near Eccleston, complete with a clock tower modelled on Big Ben. The house was pulled down in the Sixties and replaced with a modern building. The Prince of Wales, a close friend of the family, called it, rather sniffily, ‘the inn on the park’.
More recently, the duchess oversaw a complete makeover that gave Eaton Hall the look of a French chateau set among formal gardens. The Grosvenors’ very own Big Ben survives. The house is filled with treasures acquired over the centuries; the art collection includes work by Rembrandt, van Dyck, Stubbs and Gainsborough. A small army of servants headed by a housekeeper and
a butler attend to guests, who sleep on sheets monogrammed with a ‘W’.
Gerald Grosvenor was something of an accidental duke in that his father had inherited the title from a brother who, in turn, had succeeded a childless cousin. He spent his early childhood in Northern Ireland and was sent to Harrow, where his Ulster brogue chimed poorly. He hated school and left with two O-levels. In 1979, aged 27, he succeeded to the dukedom in the wake of a decade-long property crisis. There were strikes everywhere, inflation was running at up to 26 per cent and the estate was leaking money ‘like a sieve’, as the duke put it. He had hoped for a career in the regular Army but knew he had to devote himself to saving the family’s fortune. Already an officer in the Territorial Army, he continued to serve with it, retiring in 2012 with the rank of major-general. But Grosvenor Estate Holdings became very much his day job. He pitched in, working closely as chairman with the executive trustee, a savvy property man called Jimmy James. It took years, but the 6th duke not only restored the Grosvenor fortunes but also oversaw an expansion of wealth that excites admiration to this day.
This came at a high personal cost, however. In 1999, the chainsmoking, tireless duke (he was always up before 5.30am) suffered a mental breakdown. He said later that he went into a ‘black hole’, suffering all the horrors of chronic depression. ‘You can’t talk to anybody,’ he recalled. ‘You almost get frightened of going out. You just wake up in the morning and wish it was evening.’ Exhaustion and stress were diagnosed, and he cancelled everything for three months. Then he cut down drastically on his involvement with the Grosvenor business, something he clearly felt sensitive about: ‘I don’t expect people to understand the pressures of my life,’ he said. He installed video-conferencing facilities at Eaton Hall to allow essential meetings with executives, and, by his own account, recovered. The family firm, already one of the biggest players in international property, soared ever upwards.
But things had changed.
Property correspondent Mira Bar-Hillel says: ‘The duke had the most amazing
blue eyes and he seemed to radiate kindness. But you knew that the strategy and the big decisions were being handled by others, by people with their eyes firmly fixed on the bottom line.’ And that is where their eyes remain resolutely fixed – although the Grosvenor Group is a private concern, it adopts a corporate model and succeeds in a tough business environment. One of its commercial leaseholders tells Tatler: ‘When the late duke had an active role, the Grosvenor Estate was more of a patrician landlord. But after he stood down, it seemed to want to turn itself into a major property company. Now it operates like a hard-nosed multinational.’
Is that the kind of environment Hughie, the 7th duke, wants to work in? The answer, on the present evidence, is no. He has declined, so far, to take up the role of chairman of the trustees, a post traditionally held by the head of the family. He joined the estate’s graduate programme and worked in the business’s key areas, but seems to have decided against making a career there.
Perhaps the public exposure that is inevitable when one runs a multinational did not appeal. Certainly, the Grosvenors were stung by comments suggesting their trust arrangements were a way to avoid inheritance tax, which, on the Grosvenor fortune, might have run to billions when the 6th duke died. In a rare excursion into private financial matters, the family has revealed to Tatler that the trusts pay the Treasury money in lieu of inheritance tax. Its spokesman said there had been a fundamental misunderstanding of the issue. He added: ‘The trusts were set up to provide continuity rather than to avoid tax. The duke, members of the Grosvenor family and the trusts pay income tax and capital gains tax at the highest marginal rate. In addition, the trusts pay tax every 10 years based on the value of the assets in lieu of inheritance tax. So the state receives an assured sum on a regular 10-year basis.’ Jeremy Newsum, who recently retired as executive trustee, says the Grosvenors do not exploit ‘loopholes’ and that the tax situation had been misrepresented. ‘It saddens me,’ he notes. It would probably also have saddened Gerald Grosvenor, who believed in fairness. In 1990, for example, Westminster Council wanted to gentrify 532 flats in Pimlico, leased from the estate in 1937. Part of the 1937 deal was a clause stipulating that the properties should be affordably rented to ‘the working classes’. The council’s plans would have scuppered this, and the duke stepped in. He went to court and forced Westminster to stick to the original agreement. And when families on his estates were hit with bills from the Thatcher government’s poll tax, Gerald Grosvenor paid them. The tax was, he said, ‘insufferable’.
But what was perhaps most important to the 7th duke’s father was the Grosvenor name and the Grosvenor Estate. ‘This land,’ he once said, ‘has been in our family for the last 900 years and it will, hopefully, continue to be in the family for the next 900 years.’ He fought for most of his life to ensure the future wealth and health of his line. Hugh Grosvenor seems to have decided to chisel out his own niche, having perhaps learnt the lesson of his father’s breakdown. He may even be a new model for other heirs to Britain’s acres – happy to let someone else run the family firm while they get a life.
Resource: https://www.tatler.com/article/hugh-grosvenor-wealth
