'Building site' holds up school opening



A British private school has delayed the launch of its Dubai branch until 2011, saying it does not want to open "in the middle of a building site". The Oundle School had been scheduled to open its Jumeirah campus this year, and had recently delayed the opening to 2010. However, its director of educational development, Philip Couzens, said the school would now be delayed by two years because a larger real estate development that surrounds it is still a jumble of construction.

The development is behind schedule because of the economic slowdown, he explained. He did not disclose the proposed location of the school or the name of the construction project. "It's a pity, but other projects in Dubai are probably in the same situation. It's a slowdown," he said. "We would have been opening in the middle of a building site." But, he added: "In the long run, we're as confident as ever that the school that we're planning is in the right place to be successful."

The new school will have space for about 1,600 primary and secondary school pupils. A local partner will fund it and pay a fee to Oundle, a coeducational school in Northamptonshire founded in 1556. Typically such arrangements can involve the payment of a one-off fee to the parent institution when a school is set up, plus regular payments thereafter. However, Mr Couzens insisted it was not just a moneymaking exercise for Oundle and there would be strong teaching links with the parent school.

"There does need to be a real educational connection," he said. "There is formal responsibility for monitoring standards." Some Oundle staff are expected to teach at the new school, and Mr Couzens said teachers recruited for the Dubai offshoot would be expected to spend time at Oundle. He added that although the Dubai school would somewhat resemble the original architecturally, it would be "an interpretation" rather than just a copy.

There will not be a boarding school, such as at Repton, the first British private school to open in Dubai, which started a boarding operation last year. "We've never intended to have a boarding element to it," Mr Couzens said. "It's a response to what we see as the market demand in Dubai." Other leading British private schools have shown an interest in the UAE, including Brighton College, which plans two branches in Abu Dhabi.

@Email:dbardsley@thenational.ae

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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