(Bloomberg) -- It’s yet another sign of the growing exodus from Hong Kong: the cost of priority admission to the city’s Harrow International School has now dropped more than 40% from its peak.
Debenture prices at the institution, named after the 450-year-old boarding school that taught Winston Churchill and six other British prime ministers, have plunged to about HK$3.4 million ($437,000) from about HK$6 million in 2014, according to a broker that trades second-hand debentures.
Hong Kong’s strict quarantine rules and erosion of freedoms under national security laws have spurred an outflow of expats and locals alike, just as the number of international school places increased. The city’s closed border has also reduced the number of students from the mainland. A rising number of Covid cases in Hong Kong means an easing of border controls is unlikely any time soon.
“People from mainland China can’t come over to study due to the pandemic, while there are also fewer students from foreign countries,” said Tony Chan, sales director at Everfine Membership Services Ltd. With more locals moving to the U.K., demand for international education in Hong Kong is falling, he said.
Harrow in Hong Kong didn’t immediately respond to an emailed query. The South China Morning Post earlier reported on the drop in debenture prices.
A decade ago, a shortage of school places helped spur the opening of education centers with ties to U.K. boarding schools such as Harrow. To meet demand, schools sell certificates known as debentures to allow parents to guarantee a slot. Some debentures fall in value over time while others are refunded in full when a student leaves.
Harrow International School, which was founded by oil executive Daniel Chiu, sold the first and only batch of debentures at HK$600,000 each when it opened in 2012, according to its website. It is one of four international schools that made their debentures transferable in the secondary market, allowing parents to sell them to the highest bidder. At the other three, debenture prices have dropped 15% from their peaks, Chan said.
Asia International School Ltd., which operates the school, has also opened Harrows in other Asian cities including Shanghai, Beijing and Bangkok.
Raymond Kwok, a director at BA Marketing & Co Ltd., a firm specializing in memberships and school debenture trading, said prices will eventually bounce back.
“They will rise once the borders are open,” Kwok said.
©2022 Bloomberg L.P.
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