Essentials
Company: St Christopher’s Eduprop RF (Pty) Ltd
Region: Africa
Country: South Africa
Sector: Education
Business focus: Providing access to high quality, affordable education
Size: 485 learners in 2020 with a current capacity for 620 learners
Investors: Schools and Education Investment Impact Fund of South Africa – funded by Old Mutual Life Assurance Company of South Africa, the Government Employees Pension Fund (managed by the Public Investment Corporation) and the Eskom Pension and Provident Fund
Investment: Loan Facility
The St Christopher's story
South Africa’s over-burdened public schooling system faces many challenges, including sub-standard infrastructure, poor functionality of governing boards, limited access to books, teacher absenteeism and vacant posts. The King William’s Town and Kidd’s Beach schools are situated in the Eastern Cape Province, which had an average matric pass rate of 76.5% for 2019. In comparison, the King William’s Town school’s pass rate was 98.7%.
According to research conducted by Nic Spaull, Senior Researcher in the Economics Department at Stellenbosch University, for every 100 children that started Grade 1 in 2008, only 52 made it into matric, 42 passed and of the 42, only 19 achieved a bachelor pass. South Africa ranked amongst the lowest-performing countries in mathematics, science and literacy. Eight out of ten Grade 4 learners cannot read for meaning.
Through its investments in quality affordable schools such as St Christopher’s, Old Mutual Alternative Investments (OMAI) aims to improve the quality of education in the country. OMAI’s investee schools perform annual numeracy and literacy tests against set targets to continuously improve education outcomes.
The Van Daalen family acquired their first school called St Christopher’s school in King William’s Town in 2003. Initially with 210 learners, St Christopher’s grew to become a fully functional combined school of over 1 000 learners by 2019.
In 2017 with the support of OMAI, construction began on a second school in Kidd’s Beach, outside East London, in the Eastern Cape with the first ten classrooms ready for the January 2018 intake, opening with 171 learners. In its second year, the school exceeded its target of 380 learners to achieve a growth rate of 140%, breaking the 400-learner mark.
The current capacity of the school is 620 learners, which include primary and high school learners. At less than R20 000 per annum school fees (2020), St Christopher’s provides access to quality, affordable education to lower- and middle-income families.
The role played by OMAI and Impact Investing
OMAI has been investing in the South African education sector through its Schools and Education Investment Impact Fund of South Africa (Schools Fund) since 2011. The first and largest education impact fund in South Africa, the Schools Fund is focused on improving the level of education by creating access to affordable independent schools, while achieving a commercially acceptable return.
St Christopher’s development was made possible by a debt investment from the Fund, investors which include Old Mutual Life Assurance Company, the Government Employees Pension Fund (managed by the Public Investment Corporation) and the Eskom Pension and Provident Fund. OMAI maintains a strong relationship with St Christopher’s management team and plays an active stewardship role in the investment.
The Schools Fund has fully allocated its R1.4bn and further funds are being raised. The fund has about 22 800 learners enrolled in 2020 across 39 schools with 1 300 staff employed, the majority being teachers. The matric pass rate for the Fund of 92% in 2019 exceeded the national average of 81.3% and the university exemption of 48.1% outperformed the national average of 36.9%. The St Christopher’s school is an example of the positive impact achievable in the broader education sector.
Driving meaningful contributions to the UN SDG
This investment aligns with the United Nations Sustainable Development Goal (SDG) 4: Quality Education. OMAI aims to support this goal through its investments in high quality, affordable schools.
The King William’s Town campus has maintained an average matric pass rate of above 90% for the past 10 years, proving the competence and quality of the school operator. Similar results are expected for the Kidd’s Beach campus.
Going off grid – St Christopher's making green energy work
Energy
When the St Christopher’s site was purchased, bulk services needed to be secured.
Electricity was a particularly challenging issue, since there was no existing Eskom grid connection available. The management team investigated the installation of a transformer at some R970 000, and along with the inconsistent power supply from Eskom and the reality of continuously increasing cost of power, they decided the best option was to go off-grid.
The current power system consists of 65 x 330 W solar rooftop panels with a 57V lithium polymer battery bank. This system allows the school to be 100% off-grid with no dependency on Eskom power at all.
Experience to date indicates that the system produces sufficient energy in the summer months due to the long summer days, however the yield declines as the seasons change, occasionally resulting in the back-up generator having to top up the system. The graph indicates that the battery remains consistently charged at an average of 85%. Plans are currently underway to add two additional inverters that will essentially double the load capacity on the system.
Water
The municipal bulk water supply was insufficient for the Kidd’s Beach housing and school development, so the developer installed a borehole system as a temporary solution while the municipal water line was being completed, which is expected during early 2020. Currently the neighbouring housing development, as well as the school, run on this borehole system.
Due to being in a high rainfall area, St Christopher’s installed 19 rainwater tanks that can collectively hold 55 000 litres of water. The rainwater captured from the roofs is run through a ‘first flush’ system to remove larger solid particles before going into the tanks. The water is then filtered through carbon and ultraviolet filters, making it safe for human consumption. This water system allows the school to be 50% offgrid, thereby saving up to 50% on water costs, depending on rainfall levels. For the remaining 50%, St Christopher’s are using water supplied by the developer through the borehole system. The average consumption at the school is 20 litres of water per learner per day.
All the water is tested and treated on a regular basis, ensuring it is safe for human consumption.
Quotes from the school operator
“As the Development and Operations Manager of the Group, the launch of St Christopher’s Kidd’s Beach has been a huge learning curve, and the support from OMAI’s Schools Investment team has been invaluable. Working with OMAI has been a great experience both pre-construction and post-construction and we thank you for the opportunity.” – Niel van Daalen
“OMAI provided the capital for us to unlock the opportunities to provide affordable, quality education to a larger market. We also learnt best practices following OMAI’s experience launching previous schools in the past. Above all, it is a rare privilege to work with such a professional, and really likeable group of people.” – Dr HJ van Daalen