Cragside was accepted by HM Treasury in 1977 in lieu of death duties on the estate of William Watson-Armstrong (1892–1972), 2nd Baron Armstrong of Bamburgh and Cragside, with an endowment provided by the 3rd Baron Armstrong (1919–1989). It was built in its imposing setting, on a rocky crag above a gorge with an iron bridge, for the Victorian industrialist William George Armstrong (1810–1900), 1st Baron Armstrong of Cragside, and further transformed by the architect Richard Norman Shaw in the 1870s and 1880s. In 1878, it was the first house in the world to be lit by hydro-electricity and received a royal visit by the Prince and Princess of Wales in 1884. Armstrong collected and commissioned paintings by local artists from the North East such as John Wilson Carmichael, Thomas Miles Richardson, Charles Napier Hemy, Henry Hetherington Emmerson and John Turnbull Dixon. He also acquired works by major British artists of the late eighteenth and nineteenth centuries, including David Cox, J. M. W. Turner, John Everett Millais and Lord Leighton. Sadly, due to debt, many had to be dispersed in a sale in 1910 by his great nephew and successor, William Watson-Armstrong (1863–1941), 1st Baron Armstrong of Bamburgh and Cragside. However, Edward William Cooke's 'San Giorgio Maggiore and the Salute, Venice, with Fishing Craft of Chioggia and the Lagoon' (1852), was bought back in 2002. Raffaello Sorbi's 'An Italian Girl with Doves' (1866) is one of the few paintings by a contemporary foreign artist to have survived and, as a substitute for the painting 'La petite laitière' by Pierre-Edouard Frère once owned by Armstrong, 'The Little Milkmaid' was purchased in 2009. Turner’s picture of Kilgarren Castle was bequeathed to the National Trust by Lady Mildred Murray (1878–1969), Lady Fitzgerald, and displayed at Wordsworth House in Cumbria, before being added to the collection at Cragside in place of the still privately owned Armstrong painting.