Giveaway: 1 Dh per Sq M Incentive to Build Schools

Cheap land and fast-track licences for school investors were the headline announcements by the Abu Dhabi Education Council (ADEC) at a conference held yesterday in the capital to spur investment in the education sector.

“Instead of controlling the fees, more effort needs to be done to incentivise people to create schools. If you have more schools … if you give more choices, then you don’t need to worry about controlling the fees. If the supply increases, the market will control the tuition fees."

Commercial land in Abu Dhabi normally costs up to Dh2,000 a square metre but investors in schools are being offered land at just Dh1 a square metre.  Procedures surrounding application for school licences have also been eased to encourage investment.  ADEC also said that certain state owned buildings are being made available for conversion into schools.

Demand for school places in Abu Dhabi is quickening. The current growth rate is 5 per cent per annum which means that almost 70,000 new school places will be required by 2020.  In total, 215,000 children currently attend 185 private schools in Abu Dhabi.

The announcements were, however, given a cool welcome by investors, according to the Abu Dhabi based daily newspaper The National.   Speaking to the paper Gene Eidelman, president of Mosaica Education, said: “It takes three years to build a school. Adec approves the fees when the application is submitted. Three years later, especially now with housing costs going up, you’re going to be facing different circumstances.

“Instead of controlling the fees, more effort needs to be done to incentivise people to create schools. If you have more schools … if you give more choices, then you don’t need to worry about controlling the fees. If the supply increases, the market will control the tuition fees.

“What’s happening now is Adec controls tuition fees and is not doing enough to increase the supply.”

There are currently 49 plots of land allocated by ADEC to educational investors. Up to 8,000 pupils will be welcomed by three schools including an American and a British curriculum school which will be located in Khalifa City A. These schools are scheduled to open in the 2016-17 academic year.