OVER the past four years, Stenden South Africa has been growing with more than 25% year on year.
As we have around 80 beds on campus, the accommodation for students proved to be the first bottleneck.
As Stenden University of Applied Science (SUAS) in The Netherlands has a policy of not investing in bricks and mortar abroad, aside for its core function (classrooms and offices), I have approached the PA Business Forum to find investors to develop student accommodation for Stenden.
In those early days the interest was small and expectations on returns were high. In those months I probably sat with up to 10 different project developers that expected fees of up to R4 000 per student per month.
As we have to forward these fees to our students and add a margin (we clean the units, provide security, and pay for linen, towels, etc) these models would have inflated the cost of study with Stenden dramatically. Though we are a private provider, we find accessibility of our education programme very important and were therefore not very excited about the propositions made to us.
A few “smaller” investors than approached us with a different accommodation model. Opposed to building large-scale units they proposed buying an old house close to campus and adjust this to make it fit for student accommodation. This resulted in much lower fees for us and therefore our students.
The first party to stick its neck out and take this risk were the Millards, closely followed by Ross Purdon. This was in the time before Purdon was elected councillor (late 2010 if my memory serves me right). With these first responders we have signed a three-year lease guaranteeing a minimum amount of students.
After the Millards and Purdon provided us with accommodation, other interested parties came to the table as they found that this was perhaps one of the safest investments in Port Alfred at present. The latest one is the large scale project next to our campus.
Stenden is very grateful to, what we have started to call, the “first providers”, as they have taken a risk and have gone over and beyond providing comfortable and safe accommodation for our students.
With the large scale development coming up (in Muller Drive) I have personally met with all of them to query their growth plans as we feel their initial support deserves our loyalty in the long run.
Purdon was the only provider to state that he does not wish to expand his current property over the 20-bed capacity it currently has as he is not in it for a big return. From my dealings with Purdon I have come to consider him to be one of the people with the most integrity in Port Alfred. Also I find that in his dealings he tends to think of town first and his private business interest second.
I think it is incorrect to believe we favour third parties providing accommodation as it is easier to get rezoning done. I like to think we have an excellent relationship with council, not because of our contacts or political power, but merely due to the nature of our business.
Education is a clean and noble enterprise with tremendous economic spin-off for our community. I do not think Stenden would have much difficulty rezoning areas for student accommodation if it would request it, simply because of the benefits for the town.
The feedback we get from the community is almost always positive, though you will have the occasional “not in my backyard” response. Everybody agrees that it would be nice to attract more students to Port Alfred, but preferably not as their backdoor neighbours.
Our aim to grow to 1000 to 2000 students over the next 10 years still stands. The only way we see this happening is by investors jumping on board to provide accommodation and other non-academic services to our students. There is no intention whatsoever to expand the number of beds on our grounds as we need to reserve this space for academic infrastructures.
Wouter Hensens is the academic dean and general manager of Stenden South Africa.