Covid-19 Leaves Universities Short On International Students—And Money
Kanebridge News
Share Button

Covid-19 Leaves Universities Short On International Students—And Money

Experts on the sector say it will take years for the schools, among the best in the world, to recover from the economic damage.

By Mike Cherney
Fri, Feb 5, 2021Grey Clock 4 min

SYDNEY—Australia’s decision to close its borders protected it from the coronavirus. But that policy is wreaking havoc on the country’s universities, which relied on lucrative tuition from foreign students who are stuck overseas.

Experts say it will take years for the schools, among the best in the world, to recover from the economic damage. Already, Australian universities have cut more than 17,000 jobs, according to industry group Universities Australia. It said operating revenue fell 4.9% last year and is expected to fall another 5.5% this year.

“As students finish and we haven’t got new ones coming, we’re yet to hit the bottom basically,” said Peter Hurley, a policy fellow at the Mitchell Institute for Education and Health Policy, which forecast that the country’s universities could lose up to $15 billion in international tuition through 2023.

Leaders all over the world have needed to balance protecting their populations from the virus with the economic damage that those policies can cause. But with a vaccine rollout expected to start in Australia soon, pressure is ramping up on conservative Prime Minister Scott Morrison to provide clarity on how and when international students could return.

Leaders in the nation’s states and territories have pressed for some places in the quarantine system to be reserved for international students, but Mr. Morrison has argued that returning Australians must come first. Thousands of Australians remain stranded overseas because the government has imposed caps on returning travelers, part of an effort to ease pressure on its hotel quarantine system and to minimise the risk of highly contagious variants of the coronavirus from spreading into the community.

The matter could be discussed at a cabinet meeting later this week. Any change in policy could signal whether Mr. Morrison is ready to loosen border restrictions with vaccines on the horizon.

Phil Honeywood, chief executive of the International Education Association of Australia, said overseas students are starting to doubt that they will return to Australia this year. He is concerned some students may drop out and go study in other countries like Canada, the U.K. and the U.S.

“The stickability of those students is now in question,” he said.

Ahmed Korayem, a 32-year-old in Egypt, wasn’t sure whether to start a master’s program in compliance and regulation at an Australian university because of the country’s border closures. He worries that studying online wouldn’t be the same as being there in person and that it would be difficult to interact with his professors because of the time difference.

Mr. Korayem has decided to enroll at school, but he said a prolonged period of border closures could force him to drop out later.

“If it’s three months and then I would be able to move and continue my studies face-to-face, I can handle this. If it’s more than that, then I think no,” Mr. Korayem said. “The uncertainty can be stressful.”

Foreign students, particularly from China and India, have been lured to Australia by its relative proximity to Asia, easy access to visas and high-quality schools. Australian universities charged them higher fees than domestic students; international tuition at one point made up more than 40% of student revenue at universities, according to an estimate from the Mitchell Institute.

Although students can study remotely online, international-student enrollments were already down 14% as of November, according to Australian government data. The number of international students physically in the country has fallen further—and is down about 35% when compared with pre-pandemic levels—according to the Mitchell Institute’s Mr. Hurley.

“I don’t think anybody had on their risk scenarios literally no international travel,” said Paul Duldig, chief operating officer at Australian National University in Canberra, the capital. The school estimates its international-student tuition fees fell last year by about 30%.

Aside from cutting staff, universities are delaying campus improvements and eliminating fields of study. Australia’s reputation for producing important academic research is also at stake, given that universities used much of that international tuition to fund scholarly pursuits. About 11% of Australia’s researchers, including postgraduate students and staff, could lose their jobs due to the decline in fees from international students, according to research from the Melbourne Centre for the Study of Higher Education.

To make up for the revenue decline, the Australian government included about $770 million in aid to fund university research in this financial year’s budget. But a long-term solution depends on allowing international students back into the country, according to academics who have studied university finances.

Before the pandemic, Australia was the third top destination for international students, behind the U.S. and the U.K., according to United Nations data. Australian universities were also more reliant on international students than other countries. In 2018, 27% of all students in higher education in Australia were from overseas, according to data from the Organization for Economic Cooperation and Development, a group of wealthy countries that has 37 members. That was the second highest percentage in the OECD, behind tiny Luxembourg. In the U.S., just 5% were international students.

At Monash University, one of Australia’s top research schools, tuition from international students fell $85 million last year and overall revenue dropped by $270 million, a nearly 5% decline. The school is cutting 277 jobs and eliminating 2% of its courses. It is also shelving or deferring long-term building plans, including a new medical educational center, a biomedical teaching facility and an artificial-intelligence and data-science building.

Margaret Gardner, president and vice chancellor of the university, said having international students on campus enriches the academic experience for domestic students who get exposed to different cultures and viewpoints even if they are going to school close to home.

“It’s not just about plugging a hole,” she said. “I can’t begin to tell you how much difference it makes to the education you provide.”

MOST POPULAR

Interior designer Thomas Hamel on where it goes wrong in so many homes.

Following the devastation of recent flooding, experts are urging government intervention to drive the cessation of building in areas at risk.

Related Stories

Private club memberships and luxury cars are some of freebies on the table.

By SHIVANI VORA
Mon, Aug 15, 2022 6 min

When Ryan Wolitzer was looking to buy an apartment in Miami Beach late last year, several beachfront properties caught his eye. All were two-bedroom homes in high-end buildings with amenities aplenty and featured glass walls, high ceilings and an abundance of natural light. But only The Continuum, in the city’s South of Fifth district, came with a gift: a membership to Residence Yacht Club, a private club that offers excursions on luxury yachts ranging from a day in south Florida to a month around the Caribbean. Residents receive heavily discounted charters on upscale boats that have premier finishes and are stocked with top shelf spirits and wine. Mr. Wolitzer, 25, who works for a sports agency, was sold.

“The access to high-end yachts swayed my decision to buy at The Continuum and is an incentive that I take full advantage of,” Mr. Wolitzer said. “It’s huge, especially in my business when I am dealing with high-profile sports players, to be able to give them access to these incredible boats where they experience great service. I know that they’ll be well taken care of.”

Freebies and perks for homeowners such as a private club membership are a mainstay in the world of luxury real estate and intended to entice prospective buyers to sign on the dotted line.

According to Jonathan Miller, the president and chief executive of the real estate appraisal and consulting firm Miller Samuel, they’re primarily a domestic phenomenon.

In the U.S. residential real estate market, gifts are offered by both developers who want to move apartments in their swanky buildings and individuals selling their homes. They range from modest to over-the-top, Mr. Miller said, and are more prevalent when the market is soft.

“When sales lag, freebies increase in a bid to incentivize buyers,” he said. “These days, sales are slowing, and inventory is rising after two years of being the opposite, which suggests that we may see more of them going forward.”

Many of these extras are especially present in South Florida, Mr. Miller said, where the market is normalizing after the unprecedented boom it saw during the pandemic. “The frenzy in South Florida was intense compared with the rest of the country because it became a place where people wanted to live full time,” he said. “Now that the numbers are inching toward pre-pandemic levels, freebies could push wavering buyers over the finish line.”

Kelly Killoren Bensimon, a real estate salesperson for Douglas Elliman in Miami and New York, said that the gifts that she has encountered in her business include everything from yacht access and use of a summer house to magnums of pricey wine. “One person I know of who was selling a US$5 million house in the Hamptons even threw in a free Mercedes 280SL,” she said. “They didn’t want to lower the price but were happy to sweeten the deal.”

A car, an Aston Martin to be exact, is also a lure at Aston Martin Residences in Miami’s Biscayne Bay. Buyers who bought  one of the building’s 01 line apartments—a collection of 47 ocean-facing residences ranging in size from 325 to 362sqm and US$8.3 million to US$9 million in price—had their choice of the DBX Miami Riverwalk Special Edition or the DB11 Miami Riverwalk Special Edition. The DBX is Aston Martin’s first SUV and retails for around US$200,000. It may have helped propel sales given that all the apartments are sold out.

=
An Aston Martin came with the sale for some buyers at Aston Martin Residences in Miami’s Biscayne Bay. Aston Martin Residences

The US$59 million triplex penthouse, meanwhile, is still up for grabs, and the buyer will receive a US$3.2 million Aston Martin Vulcan track-only sports car, one of only 24 ever made.

“We want to give homeowners the chance to live the full Aston Martin lifestyle, and owning a beautiful Aston Martin is definitely a highlight of that,” said Alejandro Aljanti, the chief marketing officer for G&G Business Developments, the building’s developer.  “We wanted to include the cars as part of the package for our more exclusive units.”

The US$800,000 furniture budget for buyers of the North Tower condominiums at The Estates at Acqualina in Sunny Isles, Florida, is another recent head-turning perk. The 94 residences sold out last year, according to president of sales Michael Goldstein, and had a starting price of US$6.3 million. “You can pick the furniture ahead of time, and when buyers move in later this year, all they’ll need is a toothbrush,” he said.

Then there’s the US$2 million art collection that was included in the sale of the penthouse residence at the Four Seasons Residences in Miami’s Brickell neighbourhood. The property recently sold for $15.9 million and spans 817sqm feet. Designed by the renowned firm ODP Architects, it features contemporary paintings and sculpture pieces from notable names such as the American conceptual artist Bill Beckley and the sculptor Tom Brewitz.

But it’s hard to top the millions of dollars of extras that were attached to the asking price in 2019 of the US$85 million 1393sqm  duplex at the Atelier, in Manhattan’s Hell’s Kitchen neighbourhood. The list included two Rolls-Royce Phantoms, a Lamborghini Aventador, a US$1 million yacht with five years of docking fees, a summer stay at a Hamptons mansion, weekly dinners for two at lavish French restaurant Daniel and a live-in butler and private chef for a year. And the most outrageous of all: a flight for two to space.

It turned out that the so-called duplex was actually a collection of several apartments and a listing that went unsold. It did, however, generate plenty of buzz among the press and in real estate circles and was a marketing success, according to Mr. Miller.

“A listing like this that almost seems unbelievable with all the gifts will get plenty of eyeballs but is unlikely to push sales,” he said. “Empirically, it’s not an effective tactic.”

On the other hand, Mr. Miller said that more reasonable but still generous freebies, such as the membership to a yacht club, have the potential to push undecided buyers to go for the sale. “A nice but not too lavish gift won’t be the singular thing toward their decision but can be a big factor,” he said. “It’s a feel-good incentive that buyers think they’re getting without an extra cost.”

Examples of these bonuses include a membership to the 1 Hotel South Beach private beach club that buyers receive with the purchase of a residence at Baccarat Residences Brickell, or the one-year membership to the Grand Bay Beach Club in Key Biscayne for those who spring for a home at Casa Bella Residences by B&B Italia, located in downtown Miami and a residential project from the namesake renowned Italian furniture brand. The price of a membership at the Grand Bay Beach Club is usually a US$19,500 initiation fee and US$415 in monthly dues.


The Grand Salon at at Baccarat Residences Brickell in Miami.
Baccarat Residences

Still enticing but less expensive perks include the two-hour cruise around New York on a wooden Hemmingway boat, valued at US$1,900, for buyers at Quay Tower, at Brooklyn Bridge Park in New York City. The building’s developer, Robert Levine, said that he started offering the boat trip in July to help sell the remaining units. “We’re close to 70% sold, but, of course, I want everything to go,” he said.

There’s also the US$1,635 Avalon throw blanket from Hermes for those who close on a unit at Ten30 South Beach, a 33-unit boutique condominium; in Manhattan’s Financial District, a custom piece of art from the acclaimed artist James Perkins is gifted to buyers at Jolie, a 42-story building on Greenwich Street. Perkins said the value of the piece depends on the home purchase price, but the minimum is US$4,000. “The higher end homes get a more sizable work,” he said.

When gifts are part of a total real estate package, the sale can become emotional and personal, according to Chad Carroll, a real estate agent with Compass in South Florida and the founder of The Carroll Group. “If the freebie appeals to the buyer, the transaction takes on a different dynamic,” he said. “A gift becomes the kicker that they love the idea of having.”

Speaking from his own experience, Mr. Carroll said that sellers can also have an emotional connection to the exchange. “I was selling my house in Golden Isles last year for US$5.4 million and included my jet ski and paddle boards,” he said. “The buyers were a family with young kids and absolutely loved the water toys.” Mr. Carroll could have held out for a higher bidder, he said, but decided to accept their offer. “I liked them and wanted them to create the same happy memories in the home that I did,” he said.

The family moved in a few months later.