The continued recovery of international student numbers is also very positive for the sector, says the agency, although the Labour Party’s stated intention to impose VAT looms over the sector. However, not all schools are equally well placed, says Christie, noting that a number of smaller schools struggled in 2023 to maintain occupancy levels, leading to financial distress in 2023, which, in some cases, resulted in closures. Whilst the outlook for independent education remains broadly stable, subject to current political policies prevailing, a crucial factor in the success of independent schools is in the investment and maintenance of the properties to continue to make them attractive to pupils and prospective parents. As part of its annual sentiment survey, the company surveyed childcare & education professionals across the country to gather their views on the year ahead. Encouragingly, it notes, 44% of people said that they are positive about the year ahead – an 11% rise on survey figures reported in the previous year – while just 14% feel negative. When asked about their sale and acquisition plans in 2024, 71% said they are planning to buy and/or sell this year.

In 2024, Christie & Co expects:
• Demand will remain for larger independent schools – those with capacity for over 1,000 students - and ones that evidence strong trading performances
• Further provincial schools will close, notably schools with smaller capacities in less affluent areas
• Mainstream independent schools may see a slight stagnation of market activity in the lead-up to the general election as buyers proceed with caution amid a degree of uncertainty created by the Labour Party’s VAT on school fees pledge.

Courteney Donaldson, Managing Director - Childcare & Education at Christie & Co, pictured below, commented: “2023 proved to be an exceptionally busy year for our valuation and educational consultancy teams with their expertise and services being called upon by a wide range of banks, lenders, and investors seeking formal advice for refinancing and secured lending purposes. “While the year saw a number of notable transactions, overall market activity for operational assets remained relatively subdued for schools with smaller student capacities. The differential between schools that are doing well, and those that are financially struggling, appeared to widen further throughout the year, and we continued to see long-established schools having to make difficult closure decisions. Where school mergers or takeovers were not possible due to financial sustainability challenges, there was no shortage of buyers for those schools when being sold with vacant possession, with the greatest demand coming from SEND education providers and other types of buyers having regard to alternative uses.”