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RIT puts Dubai campus expansion on hold

Rochester Institute of Technology’s plans to expand its Dubai campus are on hold as the country’s economic conditions have slowed business growth and brought enrollment down 20 percent from projections.

Enrollment this year has fallen below estimates mainly because the corporations expected to send employees for graduate programs are facing economic constraints, and workers are waiting out the conditions to see if they will still be employed next year, RIT officials said.

Plans to expand the physical plant of the campus have been delayed by 18 to 24 months. The campus opened in 2008 at Dubai Silicon Oasis, a 4.5-square-mile complex that includes a high-tech park, housing, retail stores, banks and conference centers.

The campus occupies two full floors of offices and some 10 classrooms. While RIT does not disclose exact enrollment figures, plans call for the campus to grow to roughly 2,000 students in the near future. The Dubai campus has roughly 24 professors, some working full-time there and others using a mix of video webcasting from the campus here and shorter visits to Dubai.

As economic conditions in Dubai worsened and business demand contracted, real estate prices there dropped, including a 17 percent reduction at Dubai Silicon Oasis, a study from a Dubai-based recruitment consultancy firm found. In all, property prices in Dubai have fallen more than 50 percent from their peak.

RIT officials note that the campus is just a tenant of Dubai Silicon Oasis, which is a wholly owned government entity. RIT Dubai is working to renegotiate its lease to capture some benefit from the current real estate market, officials said.

There are positive signs for the campus despite current economic conditions. Many potential students have been deferring enrollment until next fall, anticipating that economic difficulties will pass, said Gregory VanLaeken, RIT business manager and analyst for global programs.

That could lead to an upswing when the economy improves, he said.

"We expect enrollment to pick up quickly next fall," said VanLaeken, who oversees RIT’s international programs, including campuses in Dubai and Kosovo. "We kind of have those in the bag; we’re just waiting and hoping things stabilize soon."

The economy in Dubai could encourage more high school students to stay there for college, said Mustafa Abushagur, president of RIT Dubai. Roughly 85 percent of Dubai’s residents are expatriates, and they often leave for American education.

The campus also can draw students from neighboring Saudi Arabia and Abu Dhabi, he said.

"We expect to really increase the number of students who will be staying inside the country," Abushagur said. "I think the potential for growth can be much higher than we expected. We have all these kids coming back from high school, and they have to go somewhere."

The campus is funded by the government of Dubai, and RIT has no financial risk in the operation. RIT was invited by Dubai to open the campus there, and it is governed by a board that includes four members nominated by Dubai’s government and four from RIT.

The college retains control of academic content, while operational decision-making is up to the board.

Courses at RIT Dubai began in September 2008, with initial offerings focused on part-time graduate students. This fall the academic slate expanded to include full-time graduate students, and next fall it will offer full-time undergraduate programs.

While RIT Dubai’s plans to expand its physical campus have been put off, its plans to grow academic offerings remain on track.

"We certainly respect what’s happening in the world economy today, but RIT Dubai was launched with a very conservative approach and the idea that we must lay the appropriate foundation to ensure long-term success," said Ross Koenig, RIT assistant vice president for budget and financial planning services. "We opened last fall with just a few graduate degree programs. We added a few more graduate degree programs this year, and we intend to launch a few undergraduate degree programs next year."

12/4/09 (c) 2009 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or e-mail rbj@rbj.net.


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