St Peter's, Cambridge is to sell 32ha of its 170ha farm for residential and commercial subdivision, investing the proceeds in an endowment fund to ensure the long-term financial independence of the school.
The school announced this week it has established an intergenerational endowment fund for the benefit of current and future students.
St Peter's, Cambridge chairman John Macaskill-Smith says, "We will use the endowment fund to ensure St Peter's is on a sustainable financial footing. Returns from the fund will be used to further develop our world-class facilities and educational options, while also providing scholarships, grants and other student support into the future."
The St Peter's, Cambridge Trust Board has entered into a joint venture with local developer, 3Ms of Cambridge, that will see 32ha transformed into a residential and commercial subdivision over the next four years.
Macaskill-Smith says this significant and financially smart move by the school will turn a portion of its significant landholding into higher-returning investments.
"St Peter's already has a significant endowment fund. At the moment this endowment – the land we own – is sitting in grass and used as farmland. It provides a good return but all our endowment assets are sitting in one basket.
"As Cambridge continues to grow, the town is coming closer to our school. This growth has created an opportunity for us to rezone a small part of our rural land into residential and commercial, develop it and use the proceeds to benefit future students and the wider community," he says.
"The board has an obligation to future generations of students to harness this opportunity now. And we've put a governance structure in place to ensure the endowment is managed sustainably.
"We've structured the joint venture with 3Ms to see returns coming into the endowment fund over many years. With careful investment, over coming decades the endowment fund should grow into a substantial and diversified investment portfolio, making it one of the most significant school endowment funds in New Zealand," says Macaskill-Smith.
The school was established in 1935 with an initial purchase of 40ha of farmland. The goal was to use the land to grow crops from which to feed the students and staff. Subsequent generations of trustees have increased the school's landholding.
Today the campus sits on about 50ha with 170ha of surrounding farmland. Owl Farm is a demonstration dairy farm joint venture with Lincoln University. The demonstration dairy farm will continue to operate for the foreseeable future.
"Current trustees feel a sense of obligation to be good stewards of this investment that has been strategically amassed by our founder and past trustees over many years. Selling a small parcel of land enables the board to develop a more diversified investment portfolio enabling us to gain ongoing returns, while also enabling us to retain the farm and continue to protect the space within and around the school campus."
Macaskill-Smith says the school found the ideal partner in 3Ms of Cambridge which has an excellent reputation for delivering quality residential developments that benefit the local community.
"3Ms has given us full confidence the final development will preserve the land's rural character, which is important to our alumni, students, staff and community."
The land set aside for the subdivision is located on the eastern boundary of the school's farmland. The intention is to release the land over two stages. Sections from Stage 1 are expected to come to market in mid-2023, with Stage 2 coming to market in mid-2025.
"This local partnership not only allows St Peter's to establish this historic endowment fund, it also creates multiple community benefits including much-needed housing, jobs and establishment of community spaces and facilities."
Macaskill-Smith says the school is working with mana whenua Ngāti Koroki Kahukura and Ngāti Hauā during the planning phase of this project and will maintain a close relationship with them as it moves through to development.