Hong Kong lures US business school branch from Singapore
But Hong Kong officials could hardly disguise their satisfaction at attracting Chicago Booth Business school’s Asia Executive MBA – EMBA – programme from Singapore, where it has operated for 13 years.
The Hong Kong government has allocated public land, a former detention centre in prestigious Mount Davis, to the school to establish an Asian branch campus, Hong Kong’s Secretary for Education Eddie Ng announced on Thursday.
Ng said: “The establishment of a campus of Chicago Booth in Hong Kong will enhance Hong Kong's position as a regional education hub, nurture talent to support the growth of our economy, and strengthen Hong Kong's competitiveness."
In Singapore, member of parliament Inderjit Singh, who sits on the parliamentary committee for education, told local newspapers that Chicago Booth’s departure was a “pity” since Singapore had worked hard to establish itself as a hub for higher education.
“I think this will definitely be a dent in our efforts to attract good schools here, and to transform us into an attractive city for talent, especially those from Asia,” Singh was quoted as saying. He has previously raised questions over the subsidy amounts the government has paid to attract and keep overseas institutions in Singapore.
Just this week Singapore’s Minister for Trade and Industry Lim Hng Kiang revealed that the ministry’s Economic Development Board, or EDB, had to date provided S$5.3 million (just over US$4 million) to support a joint postgraduate law degree programme – set up by New York University and the National University of Singapore – which is about to be mothballed.
Hong Kong building
A huge listed building in one of Hong Kong’s most upmarket areas has been offered to the business school at a peppercorn ‘one-off premium’ of HK$1,000 or just US$130. It is thought the deal will last at least 10 years.
Chicago Booth Asia’s William Kooser, associate dean for global outreach, admitted to local media that the business school – which charges students in Asia some US$151,000 and does not provide scholarships – would not have been able to afford to set up shop in the city without the Hong Kong government's help.
But according to a recently published annual report for 2011-12, fees collected from executive education at Chigaco Booth rose by 33% to US$20 million for the two years that ended in June 2012, making it one of the school’s fastest-growing sources of revenue in that period.
Chicago Booth was able to secure the new site – which was first used as a clubhouse for British soldiers before being turned into a jail for political prisoners – by competing in a Hong Kong government land grant scheme. A private college run by Hong Kong University, Centennial College, had also submitted a bid for the site.
The Hong Kong government’s decision is likely to raise hackles locally as it has recently been backtracking on priority for education institutions in allocating scarce land.
This is not the first time Hong Kong has given a heritage site to a branch campus at nominal rent. In 2009 the government controversially handed over the disused, historic North Kowloon magistracy building to the US-based Savannah College of Art and Design to set up its Asian campus. The college has struggled to recruit local students despite expensive renovations.
Chicago Booth has said it would invest up to HK$500 million (US$65 million) in remodelling and restoring its Hong Kong building, and in heritage maintenance.
Singapore lease running out
Although the move appeared to come as a surprise in Singapore, Chicago sources said that the dean of Chicago Booth, Sunil Kumar, had already informed students late last year that the Singapore lease would only run until 2015. Kumar had said the school would look in both Singapore and Hong Kong for a replacement site.
Chicago Booth’s Singapore campus is housed in a traditional courtyard house mansion of a 19th century merchant – one of the last buildings of its kind still standing, and classified as a national monument. Its current owners put the building up for sale this year. The school has some 160 students in Singapore at present, on the 21-month EMBA course.
Chicago Booth sources said the business school was attracted to Hong Kong in part because of the willingness of Chinese students to pay its high fees and because EMBA students in the US were interested in understanding and working in China.
“Educating future leaders from the world’s second leading economy is a powerful attraction,” Kumar said. The focus of the Singapore campus was South East Asia rather than China.
Sources in Singapore said there was a limit to expanding an EMBA programme situated in Singapore, compared to the possibilities in China where EMBA degrees are extremely popular among the business elite.
The University of Chicago opened a centre in Beijing in 2010, “which has fostered collaborative work of faculty and students across the full range of the university with colleagues and institutions in China and beyond”, the university said in a statement.
Not ‘leaving’ Singapore
In its press release, Chicago Booth said the Hong Kong campus was “a move to expand and strengthen the school's presence and influence across the region, while continuing a robust presence in Singapore”.
Kumar said: “We aspire to have a robust, ongoing presence in Singapore, and we are looking at options for continued and new programming in the region."
Chicago Booth said that it was exploring space options for holding classes and other activities in Singapore after the Asia EMBA programme relocates.
It will begin teaching MBA classes in Hong Kong in 2014 at a temporary location. Classes will not move into the Mount Davis site until 2015 or even 2016.
Since the Singapore campus opened in 2000, more than 1,000 students have graduated from the Asia EMBA programme, and nearly 2,000 students from Booth's London and Chicago campuses have spent time on the Singapore campus.