Index to put school rents on level playing field launched by KHDA and Rera

The unified index will establish appropriate levels of rent for different areas with a view to achieving stability in the rental market for public, as well as private, educational buildings.

At present rents for adjacent schools can vary significantly, which in the case of private schools has a knock-on effect on the level of tuition fees.

The new scheme, which will involve the development of long-term rental contracts, is intended to smooth out such disparities and inconsistencies.

The authority believes the unified index will assist private schools and investors and support them in confronting unjustified rent increases. The scheme is also intended to benefit parents.
The KHDA will contribute to the rent regulation and contract registration processes and in addition identify rented units and determine their usage, the facilities attached to them and the clauses and conditions of rental contracts.
The agreement covers universities and training institutions as well as schools. 72% of the total number of private schools in Dubai have rental agreements, which is 103 out of 144 schools.

"Developing a unified rental index is part of a comprehensive system. We are working towards a time when parents choose a school for its quality alone."

said Dr Abdulla Al Karam, Chairman of the Board of Directors and Director General of the KHDA.

"The scheme aims to define the prices of educational services among various education providers, attracting investment in education to Dubai and enhancing quality in all areas within schools, from the educational to the administrative levels."

He said the KHDA was taking into account the interests of everyone involved in the sector, including parents and investors, by cooperating with RERA over the regulatory procedures for education facilities.

"This enhances the KHDA's principle of commitment to transparency and accountability highlighted in the Dubai Strategic Plan 2015," added Dr Al Karam. "In addition it will elevate Dubai's position in the field of education on both the regional and international levels as well as increasing competition within the sector."

RERA is part of the Dubai Land Department, whose Director General, Sultan bin Butti bin Mijren, said: "The role that the Dubai Land Department undertakes in regulating the real estate market is not limited to the commercial and residential buildings only, it also extends to the usage of land and facilities in Dubai".

He added: "This agreement with the Knowledge and Human Development Authority aims at enhancing the role of the Land Department in the registration of educational facilities including properties and rent contracts, through utilizing an extremely transparent approach in defining the rent index for the rents of those facilities. This paves the way for all related parties to develop long term rent contracts, which will eventually stabilize the educational sector and benefit all stakeholders."

And Mohamed Khaleefa bin Hamad, Director of RERA's Owners' Relationship Management Department, said: "The KHDA will provide lists and records of the types of rented units, their usage and the facilities attached to them. RERA will review and use this information as a reference in the classification process for facilities and register the rental contracts.
"RERA will in addition grant preliminary approval for educational entities that provide education and training for the real estate sector."

Mohammed Darwish, Chief of Licensing at the KHDA, said: "The unified index being developed in collaboration with RERA will benefit all education sector stakeholders through its impact on school tuition fees. It will provide a methodology and mechanism to evaluate and regulate the rents of educational facilities."

The agreement is in line with Law No 26 of 2007, which requires all rental contracts to be registered with RERA.

The agreement was signed by bin Mijren of the Land Department and Dr Al Karam of the KHDA in the presence of Engineer Marwan bin Gulaita, CEO of RERA, bin Hamad of RERA and Darwish of the KHDA.

This signing follows the KHDA's recent agreement with the Dubai Department of Economic Development (DED) on providing common mechanisms to facilitate licensing procedures for institutions providing educational services or any other activities related to KHDA.

The DED agreement calls for the sharing of the records of more than 500 educational facilities, creating an electronic system linking the entities to encourage cooperation for providing preliminary approvals for educational facilities.