Having suffered from indoor air quality problems, the Nopola School Centre was transformed over a period of a couple of years into a multi-purpose school that promotes modern interaction and learning together. The costs of the school project, which were funded by real-estate leasing, fell by half, thanks to careful economic planning.
Having suffered from indoor air quality problems, the Nopola School Centre was transformed over a period of a couple of years into a multi-purpose school that promotes modern interaction and learning together. The costs of the school project, which were funded by real-estate leasing, fell by half, thanks to careful economic planning.
This is a situation familiar to many Finnish municipalities: old school buildings built mainly in the 60s and 70s are coming to the end of their life cycle, and problems with indoor air quality are discussed in both everyday conversations and debates in the media nationwide.
The municipality of Kyyjärvi in Central Finland was facing such a situation four years ago: multiple repair attempts had failed to resolve the issue, and the only comprehensive school in the small municipality was no longer a safe learning place for schoolchildren. In 2014 a decision was made to build a new school centre.
Right from the start, community spirit was at the heart of the school design. In the design phase, the users of the school space had their say and were carefully listened to. Kyyjärvi set to designing the school centre with great energy.
“We wanted a school that reflected its users. Right from the outset, the idea was to build more than a traditional school, a school that had something new to offer,” says Jouko Huumarkangas, Chairman of the Municipal Board of Kyyjärvi.
However, the designs and multiple wishes escalated both the size and cost of the school.
“The result of the first design was a draft of a very traditional school whose costs were estimated at EUR 8 million,” Huumarkangas recalls.
Economic adviser to the municipality
It was time to take a step back and critically assess the municipality’s economic capacity. Municipality Finance became involved in the project at an exceptionally early stage, even before the new design was completed. The result of MuniFin’s analysis set a new framework for the school project.
“A new school centre is always a huge investment. In Kyyjärvi, the investment had grown over the years and, at a cost of EUR 8 million, would have unduly burdened Kyyjärvi’s economy. Together with the decision-makers of the Kyyjärvi municipality, we started exploring other options,” says Daniel Eriksson, Financing Manager at MuniFin.
Around the same time, the Finnish National Agency for Education released a new curriculum that emphasised functionality and learning together, giving the design of the Nopola School Centre new impetus. The premises were designed with particular attention to their multi-purpose use and utilisation also outside school hours.
“It finally felt like we were heading in the right direction. One noteworthy point taken into account was the fact that often the utilisation rate of school facilities is very low. With these things in mind, the construction firm designed a much smaller school in terms of square metres, but a functional, modern one, which can be used in a versatile way also for recreational activities. What the design lacked is the traditional labyrinthine complexity typical of school buildings,” says Huumarkangas.
In the completed solution, the square metres of the school centre are efficiently utilised with no wasted space.
“The effective use of space means that the total square metres of the school centre could be substantially reduced without endangering the functionality of the building designed for 145 students. In the end, the completed version is less than half the cost of the previous design and well aligned with the economic capacity of the Kyyjärvi municipality,” Eriksson continues.
Real-estate leasing brings flexibility to loan repayment
Similarly to the school centre, its form of funding was also non-traditional. Instead of a balance sheet loan, Kyyjärvi decided on flexible real-estate leasing. In the real-estate leasing model, MuniFin is the owner and financier of the building, also during its construction, while the municipality of Kyyjärvi leases the Nopola School Centre from MuniFin and is responsible for its maintenance.
The popularity of this model in the acquisition of social projects, such as schools and day care centres, has grown rapidly. In Kyyjärvi, this solution was favoured because of the amortisation of investment-related costs.
“We simply didn’t want to put all our eggs in one basket. For us, it made more sense to amortise costs over a longer period to avoid overburdening the economy of our small municipality,” Huumarkangas explains.
At EUR 3.5 million, the final price of the project was less than half the original estimate. How is this even possible?
“With careful calculations and analyses – numbers don’t lie. It’s also a matter of method. We take our responsibility for the sustainability of the solutions we offer very seriously. In financial leasing, the costs are distributed over a long period which means that the investment does not burden the municipality’s balance sheet, unlike when financing with a balance sheet loan,” says Janne Karaus, Development Analyst at MuniFin.
The result is no compromise
The Nopola School Centre opened its doors to the municipality’s 145 student in August. The modern school has comfortable, open spaces and rotating facilities. The teachers work in pairs and teach groups at different levels, so that each student receives instruction in accordance with their skill level. The new facilities and working methods have required some adjustment from both teachers and students, but the feedback has been very positive.
“No pain, no gain. Overall, this project has been an excellent learning experience. The entire municipality has lived and breathed this project – the Nopola school belongs to the whole municipality,” Huurmarkangas says happily.
The new school also has appeal outside the municipality of Kyyjärvi.
“We want to keep Kyyjärvi lively and dynamic and in this way create a healthy and safe place for families with children to live. I’m pleased to say we welcomed two students who are not residents of our municipality to our school this autumn,” says Huumarkangas.
Text: Heidi Penttinen
Photos: Niklas Vuorenmäki