from: $8.382 Bln
to: $9.731 Bln
a pickup of roughly $1.350Bln
http://www.nacubo.org/Documents/EndowmentFiles/2014_Endowment_Market_Values.pdf
There are a few schools which did much better than UM on a percent basis. Historically,
schools which outperform significantly underperform in the next year…possibly due to restatement
of aggressive marks to market or to simple mean-reversion in a retained asset class which underperforms
after outsized performance in a prior year.
Northwestern leapt past Michigan. So did UT-Austin. Their 25% increase in the value of their endowments is massive! As far as single campuses go, Michigan is 8th. Texas A&M system includes a number of universities.
In 1991, Northwestern had twice UM’s endowment, UM only surpassed them in the year 2000. UM has led Northwestern for most of the intervening years until this year. As noted above, I’m not sure how real that 25% figure is for either of those endowments. At that size endowment, it usually takes an outsized gain in one asset classic to gain that much ground and usually due to a mark to market that will experience a subsequent year’s mean reversion. We won’t know until this time next year and see the two year return. In the meantime, a few schools (including Columbia) have finished capital campaigns so those additional dollars won’t move the list much. UM in the meantime is at around $2.5Bln into its $4Bln quest. Capital campaigns usually add 25% of the goal to endowment (rather than operational spending…the use of most year amounts raised) so UM should be able to add another $400MM or so to the endowment beyond annual figures and annual returns.
Not sure how UTA leapt past Michigan this year since they have always had a higher endowment as an entire system.
“Not sure how UTA leapt past Michigan this year since they have always had a higher endowment as an entire system.”
UT-Austin’s endowment is roughly 40% of the entire system’s. Last year, the system’s endowment was $20 billion, so UT-Austin’s endowment would have been roughly $8 billion, compared to Michigan’s $8.4 billion. This year, the system’s endowment increased by 25% to a whopping $25 billion, so UT-Austin’s endowment would be roughly $10 billion, compared to Michigan’s $9.7 billion. I see this trend continue in the future as UT-Austin’s primary source of investment are Texas’ large energy firms that have been doing extremely well since 2004 and will continue to do very well in the future.
@Alexandre, the oil boom is turning in to a bust. And my understanding is that the main driver of the endowments of the TX schools is the oil in the ground of the land they own, not their stakes in energy companies.
BTW, Northwestern is at the start of a major fundraising campaign.
That is correct, both Michigan and NU are in the midst of a $4 billion fundraising campaign.
blue85, the doc clearly states that the 16% is not the return.
Also, Alexandre, if you haven’t noticed, CL1 has been in the crappers lately.
“blue85, the doc clearly states that the 16% is not the return.”
Yeah, a sloppy headline on my part, but I think most people understand the components and can differentiate return from total delta.
“the main driver of the endowments of the TX schools is the oil in the ground of the land they own, not their stakes in energy companies.”
Yes, this is correct the permanent university funds (the rough title), have, for many years, held millions of acres of land which was put in trust, the revenues of which contribute to the endowment. For years I’ve been wondering if they would try to put those properties into hyperdrive to crank the endowments up. It looks like they may be taking steps in that direction. https://en.wikipedia.org/wiki/Permanent_University_Fund
Impressive endowments from the top liberal arts colleges…especially because they’re small and don’t have to support expensive hospital operations and medical research.
I agree UCBChem. LACs with fewer than 3,000 students and no graduate programs having endowments of $2 billion. That’s sick!