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Dubai’s ‘continuous growth’ lifts education market

The Mena education sector will be worth $175 billion by 2027, according to analyst Industry Arc UAE Ministry of Education
The Mena education sector will be worth $175 billion by 2027, according to analyst Industry Arc
  • 22 new schools open in Dubai in past three years
  • Mena education market forecast to grow by 8.5% a year to 2027
  • 37% of startups focused on K-12 online or home schooling

Dubai’s primary and secondary education sector is thriving, according to an industry expert, providing opportunities for landlords, operators and international investors.

At the start of this academic year the number of students from kindergarten to twelfth grade, known as K-12, enrolled in the emirate’s 216 private schools stood at 326,000 – a 4.5 percent increase from June 2022. Over the past three years, 22 new schools have opened in Dubai.

“This is in line with the continuous growth in Dubai’s economy and residential real estate sector,” said Mansoor Ahmed, head of development solutions for education at real estate consultancy Colliers.

“Many nationalities are choosing it as their first home, following economic and political turmoil in other parts of the world.

“After the Covid pandemic, the UAE has established itself as one of the most resilient economies in the world and one of the safest, providing good quality of life and some of the best education and healthcare systems.”

In line with Dubai’s new residents, an increasing number of investors in the sector come from China, Russia and former Soviet republics, according to Ahmed.

The Mena education sector is forecast to be worth $175 billion by 2027, with a compound annual growth rate of 8.5 percent from 2022, according to analyst Industry Arc.

A-levels, baccalaureates and more
From kindergarten to 12th grade, parents looking at private schools in Dubai can choose from 17 different curriculums. The UK curriculum (36 percent) is the top choice, followed by Indian (26 percent), American (15 percent), International Baccalaureate (7 percent) and UK/IB hybrid curriculum (4 percent).

Around 37 percent of education startups are working on K-12 online education or the home schooling market.

Shailesh Dash, founder of digital training startup Newage Learning, said: “Since we expect the population of the UAE to at least double in the next decade or so, there will be a significant capacity shortage in existing schools. I don’t see the K-12 business reaching saturation until at least 2030.”

In November last year schools operator Taaleem raised $204 million from its listing on the Dubai Financial Market, selling 254.2 million shares, or a 25.3 percent stake. The IPO attracted strong demand from local and international investors and was more than 18 times oversubscribed.

The company – which runs 17 private schools in Dubai and Abu Dhabi under American and British curriculums, in addition to the International Baccalaureate programme – has reported net profits of AED119.5 million ($32.53 million) for the six months to the end of February 2023, up 19.5 percent year-on-year.

Revenue increased 30.2 percent year-on-year to AED468.6 million.

CEO Alan Williamson, who announced a 3 percent increase in tuition fees for next year alongside the half-year results, said there had been “significant growth in enrolment” with student numbers up 45.9 percent year-on-year.

He added: “Taaleem’s sustained growth and prudent management of expenses have resulted in a robust financial performance while sustaining our commitment to the highest quality education.”

Last year GEMS Education, which operates more than 60 schools with over 130,000 students across the Middle East and North Africa, announced plans to sell a controlling stake or to list the business, Bloomberg reported.

Private equity firm CVC Capital Partners and GEMS founder Sunny Varkey were said to be considering selling their stakes, which have been valued at $6 billion.

In October last year, global investment house Safanad and international education platform Global School Management announced plans to invest $200 million in the Middle East.

Initially focusing on the UAE and Saudi Arabia, the partnership plans to boost investment further as it expands its portfolio of schools in the region.

“In simple terms, Dubai’s K-12 education sector is thriving,” said Ahmed.

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