Lessons in estate management: How private schools can use their assets

Private schools face a number of challenges and are going through a period of transition, but there are options for bursars and those managing their estates to explore to help support long-term operation and financial stability.

The challenges are not the same for every school but may include the impact of the introduction of VAT on fees, dwindling student numbers as birth rates drop and ageing assets.

Private schools still have to cover their costs, attract pupils and ensure facilities meet student and staff needs.

Navigating ongoing challenges was a key theme at the ISBA conference, which Carter Jonas attended, and this is a digest of some of the ideas explored.

Building long-term resilience is important, and taking stock of all property assets is a crucial starting point. Once there is an understanding of what is in the portfolio, the condition and value, then a school can review options.

A review is an opportunity to look at the current position, the priorities and responses, should certain things change, so that the school can continue. If considering a merger to combat falling pupil numbers, getting assets reviewed and valued is essential. It will help determine where improvements are needed and if some buildings are surplus to requirement.

Similarly, converting single sex schools to co-educational to widen the pool of potential pupils has property implications. Facilities will need to be reviewed and potentially adapted to ensure there are appropriate spaces to meet needs, such as separate toilets.

Building new facilities to improve the school offer could be an option, but a review of assets will establish whether there are existing amenities that can be improved, repurposed or reused first.

A review can determine the condition of buildings, which should be part of the business plan. At the conference, a traffic light system was suggested, from which priorities can be planned.

Even if the business plan for the next 5-10 years is showing up ‘green’ rather than amber or red, it is still worth knowing what assets can provide and where they can support the overall plan.

A plan should address individual assets which fall into the amber or red categories but shouldn’t neglect those that are in good condition either. Planned maintenance can help keep buildings in good shape and is more cost-effective than emergency repairs later down the line.

There are potential changes coming, such as the National Planning Policy Framework (NPPF) and updates to greenbelt rules, which can make a difference to overall plans. It’s a good strategy to ensure masterplans are up to date and reflect future changes and challenges.

Getting up-to-date property valuations also means that if a school needs to take on extra borrowing for repairs or expansion, supporting information is available.

And getting a planning appraisal of assets means it is easier to assess each building’s potential. What in the portfolio can be repurposed, converted, or potentially disposed of.

Some schools will have heritage assets which need to be treated with care or risk penalties. Expert advice from a heritage specialist will outline what can and can’t be done to buildings, and listed Building consent may be required for some work.

Upgrade work to make heritage buildings more sustainable should be treated with the same care to keep within regulations.

Off-loading unused or underused properties can deliver financial boosts. Alternatively, converting space and leasing it out for commercial uses, such as workspace, delivers additional income. It’s a different way of thinking about property assets.

Other commercial opportunities were also raised.

Could certain facilities be opened up for public use to help offset costs – a swimming pool, for example. If a school is planning new amenities, particularly for sports, then exploring community as well as school use can support planning applications.

Stowe House was given as an example where its rugby facilities are used by the Northampton Saints for their pre-season training.

Out-of-term time uses are another consideration to generate additional income. Ideas suggested include letting out dorms as accommodation or registering picturesque buildings as wedding venues.

Not a typical alternative use, but a school in Bristol rents out its entire campus to a TV production company for on-location filming during the Summer holidays.

It’s important that school bursars and those managing the assets ask questions. There isn’t a one-size-fits-all solution; every school is different, and responses can be tailored depending on needs and priorities.