Scholé Limited, the new Makini Schools owner, is set to relocate one of its campuses in Nairobi as it grapples with space constraints on a parcel which was leased from founder Mary Okello.
In a move that will likely lead to an increase in fees paid, the school’s management has informed parents that Makini Junior Academy on State House Avenue will be moved to another part of the city as Ms Okello plans to put the building into other use.
The management has laid out alternatives for parents that includes building new structures and renting them to the company, which acquired the group of schools last year at nearly Sh1 billion.
“A consortium of parents could choose to be our property partner. You could get together and create a fund to buy a property, which you then rent to the school affordably,” reads a brief from the school dated June 7 and addressed to parents.
The Okello family sold a 71 per cent stake in the schools to Scholé Limited and South Africa’s Johannesburg Stock Exchange (JSE)-listed AdvTech last year.
The brief to parents indicates that the Okello family may have retained ownership of the land and its buildings while the new owners pay them rent.
“The State House property was not included in the long-term lease — the Okello family had other (non-educational) plans for the site. However they were willing to rent it to us separately, initially to December 2018. Last year, we managed to extend the lease for one year to December 2019. This year we are again in negotiations to do so. We will not be able to do this indefinitely,” reads the document.
Parents now have until June 23 to give their views on how best to handle the situation.
“They (AdvTech) are also a JSE-listed company and can only secure funds for investment if they can demonstrate that they are delivering a return. We would need to create a business case for them that will satisfy their shareholders; We will not succeed in securing investment for a loss making solution,” adds the brief.
Management is now proposing an increase of Sh10,000 a year extra per child to go towards paying rent.
The management also adds that if they buy a property for Sh850 million, which would be a good price for a property in the area, they would require a rent of Sh68 million which is Sh226,700 per child — more than the revenue from the school.
“We are committed to consultation with parents and value your opinion. We are open to fully exploring any other options you might propose to help us find the best possible solution.”