Now It Looks Like Dubai Has Too Many Private Schools

(Bloomberg) -- Dubai’s school market is turning in favor of parents, according to Knight Frank.

“The education sector in Dubai is now at a tipping point, with aggressive marketing and tuition fee discounts symptomatic of an oversupply of schools,” according to a report. Education providers are facing further pressure with the addition of 13 schools in the current academic year, bringing the total number of private schools to 207.

The increase in supply comes even after Dubai imposed a freeze on school-fee hikes. GEMS Education, the Dubai-based school operator backed by Blackstone Group LP, postponed plans for an initial public offering after the decision, people with knowledge of the matter said in June.

The United Arab Emirates, which Dubai is part of, has taken a number of measures to curb a rise in the cost of living and stimulate a sluggish economy. A 2017 study by HSBC Holdings Plc found spending on children’s education in the U.A.E. is the second-highest in the world, after Hong Kong.

The increased supply may particularly affect mispriced schools -- expensive schools in mid-income neighborhoods that already have below average occupancy rates, Knight Frank said.

Here’s a breakdown of schools in Dubai by curriculum in the 2016-2017 academic year:

  • U.K.: 74 schools with 93,771 students
  • American: 34 schools with 48,257 students
  • Indian: 33 schools with 79,579 students
  • International Baccalaureate: 11 schools with 13,232 students
  • U.A.E. Ministry of Education: 11 schools with 13,678 students

©2018 Bloomberg L.P.

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