01
ENDOWMENT REPORT
PAULA BURCH-CELENTANO
ENDOWMENT MANAGEMENT COMMITTEE Mr. Andrew B. Wisdom Chair Crescent Capital Consulting New Orleans, LA Mr. Michael A. Corasaniti Vice-Chair Tourmalet Advisors, LP Fairfield, CT
Ms. Elizabeth Connolly Alexander Cotiviti Healthcare Rye, NY
Mr. E. Pierce Marshall Jr. Élevage Capital Management, LLC Dallas, TX
Mr. Darryl D. Berger (emeritus) The Berger Company New Orleans, LA
Mr. Rick S. Reese LongueVue Capital, LLC Metairie, LA
Mr. Douglas J. Hertz (ex-officio) United Distributors, Inc. Smyrna, GA
Table of Contents
Letter from the CIO 1 Endowment Support
2–4, 13
Market Events 5 Endowment Returns
6–12, 14
Staff 15–16 Location 17
LETTER FROM THE CIO
Dear Faculty, Staff, Alumni and Friends of Tulane University, I am delighted to report that Tulane’s endowment again performed well during fiscal year 2018. This year’s return of 10.8% for the Pooled Endowment was driven by strong results in our private capital portfolios which we have worked hard to build over the last five years. Eminent Scholars also performed well, returning 8.5% for the year, but limited by its lower exposure to private capital mandated by the Louisiana Board of Regents. Both portfolios outperformed their respective policy portfolios as well as the passive index, not just for the fiscal year, but over three, five and ten years as well. As we mark the tenth anniversary of the Global Financial Crisis, we are reminded of the extraordinary events of the last decade and the inherent risk of investing in the financial markets. The diversified, multi-asset class approach implemented by most university endowments, including Tulane, has largely weathered the storm, managing to protect the long-term value of these assets. We carefully evaluate our results in the context of the risks we have taken. We have undoubtedly missed some high returning opportunities that might have enhanced our results. Nonetheless, I am also pleased to report that by all measures we have generated our strong results with below average risk. The success of an investment program for an endowment is measured not in years, but decades. Our results over the last five and ten years show that we have outperformed our benchmarks and the vast majority of our peers, and that we have succeeded in spite of taking less risk. As we begin our second decade as an office, I am reassured by the caliber of the team and the processes we have developed to evaluate investment opportunities and responsibly react to a changing market environment. We remain committed to successfully stewarding the long-term assets of the University in the years to come.
FISCAL YEAR 2018 ACCOMPLISHMENTS: • Hired eight new managers across the marketable portion of the portfolio totaling $110 million • Trimmed overall equity exposure by $65 million • Added to, trimmed or re-upped with nine existing managers • Committed over $90 million to private capital partnerships • Added four new private capital relationships and re-upped with seven others • Completed an extensive (eighth annual) review of all managers in the portfolio • Attended annual meetings across the US and globally
Jeremy T. Crigler Chief Investment Officer Tulane University
• 800+ manager meetings, calls and conferences
2018 ENDOWMENT REPORT | 1
E N DOWMENT SUPPORT IMPORTANCE OF AN ENDOWMENT Protection – Innovation – Commitment After 184 years, Tulane University has established itself as one of the world’s preeminent educational and research institutions. The university’s mission exists in perpetuity. However, to continuously offer new programs and new services requires an ever-growing pool of financial resources. The Endowment is unique among the University’s revenue streams since it provides perpetual support for Tulane’s students, both current and prospective. To put the power of the Endowment in perspective, a $1.0 million gift made ten years ago and invested in the Pooled Endowment generated more than $455,000 to recruit the highest quality students regardless of financial need, to pay professorships and fund basic research, and to perpetuate community service initiatives. Most importantly, that original gift remains intact today and will continue to fund Tulane in the future. We urge you to support the Endowment because these specific gifts ensure the long-term financial strength of the Institution, benefiting future generations of Tulanians.
COMPONENTS OF THE ENDOWMENT Pooled Endowment
MARKET VALUE $1,006.0
Eminent Scholars
$209.3
Separately Invested
$152.4
University-Owned Real Estate
$16.6
Gift Annuities/Life Income Trusts
$18.9 $1,403.3 PAULA BURCH-CELENTANO
TOTAL ENDOWMENT
2 | 2018 ENDOWMENT REPORT
$1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200
POOLED ENDOWMENT
A. B. Freeman School of Business 11% School of Social Work 1%
SEPARATELY INVESTED
Financial Aid 10%
FY 2017
FY 2018
FY 2015
FY 2016
FY 2013
FY 2014
FY 2011
FY 2012
FY 2010
FY 2009
FY 2007
FY 2008
FY 2005
FY 2006
FY 2003
FY 2004
FY 2001
FY 2002
FY 1999
EMINENT SCHOLARS
FY 2000
FY 1997
FY 1998
FY 1995
FY 1996
FY 1993
FY 1994
FY 1991
FY 1992
FY 1989
FY 1990
FY 1987
FY 1988
$0 FY 1986
TOTAL ENDOWMENT (IN $MM)
EN DOWM EN T S U PPO RT
GIFTS, ANNUITIES & LIFE INCOME TRUSTS
School of Architecture 2% Law School 6%
School of Liberal Arts 12%
Athletics 1% School of Medicine 29%
General University 13% Centers, Institutes & Libraries 4%
School of Science & Engineering 8%
School of Public Health & Tropical Medicine 3%
ENDOWMENT SUPPORT BY PROGRAM 2018 ENDOWMENT REPORT | 3
E N DOWMENT SUPPORT A Passion for Education Victor P. Chisesi, MD was a man of great passions. A world traveler, an art collector, and a theater and opera aficionado, he reserved his greatest enthusiasm for Tulane University. He began at Tulane as an undergraduate, studying zoology and urging on the Green Wave from the field as a cheerleader. It was a habit he never quite broke, even after graduation, never too busy with his successful career as an orthopaedic surgeon to shout down any nearby LSU fans with a hearty hullabaloo from the sidelines. After receiving his undergraduate degree from Tulane, he continued on at his beloved alma mater for his medical degree, graduating in 1962. A talented surgeon, with a solo practice and later a partnership with Drs. S. J. LoCoco and William M. Pusateri, he was committed to teaching in the Tulane Medical School Department of Orthopaedics. “It’s remarkable—even humbling—to recognize how much Tulane meant to Dr. Chisesi throughout his life,” Dr. L. Lee Hamm, the dean of the School of Medicine, reflected. “His passion for the Green Wave was unflagging, but I think there was something very special about the enthusiasm he brought to teaching our medical students.” The recipient of a scholarship himself, Chisesi was determined to find a way to continue to support the school that had meant so much to him, even after he passed away. He left a generous estate gift to establish the Mr. and Mrs. Victor A. Chisesi Scholarship Fund, named in honor of his parents. According to Dean Hamm, “Dr. Chisesi had been a scholarship student, and he was aware what a transformative impact his medical education made for him. During his life, we were so fortunate that he taught in the Department of Orthopaedics, and I think he wanted to make sure that he could continue to make a meaningful impact on our medical students after he passed away. We are honored that he chose to do so through the Chisesi Scholarship Fund.” The Chisesi Scholarship Fund is for rising medical students in financial need. The scholarship will have a tremendous impact, opening the doors to a medical career for talented students who might not otherwise be able to attend Tulane. This past July, the first Chisesi Scholarship was awarded to Sydney C. Labat. 4 | 2018 ENDOWMENT REPORT
MARKET EVENTS FY18 Fiscal year 2018 was a tale of two halves. The second half of calendar 2017 saw continued strong performance across all major equity markets, buoyed by low interest •T otal Endowment ended the year at rates, low levels of inflation, strong $1.4 billion, a new high watermark global growth and tax reform in the US. According to the VIX •D istributions to support the operating Index, volatility in the US equity budget totaled $54.7 million markets continued to decline well below pre-crisis lows. In February • 60 new Endowment Funds were created 2018, however, the music temduring the fiscal year porarily stopped as most major markets experienced sudden de•N ew gifts and transfers into the clines due to the unwinding of crowded short volatility trades. Endowment totaled $25.7 million Since then, global markets diverged with US equity markets •C ombined return of +10.4% for Pooled up slightly, led by the FAANG Endowment and Eminent Scholars stocks yet again, while Europe, Japan, and Emerging Markets •P erformance ranked in the top quartile all experienced declines. compared to peer institutions In the US, the S&P 500 capped a strong fiscal year up 14.4%, driven by information technology, consumer discretionary, and energy sectors. Small capitalization growth stocks also saw strong returns with the Russell 2000 Growth Index up 21.9%. In fact, during the fiscal year, growth stocks greatly outperformed value stocks across all market capitalization ranges with the Russell 3000 Growth Index outperforming the Russell 3000 Value Index by 15.2%. In international markets, the MSCI ACWI ex-US Index ended the fiscal year up 7.8%, despite a pullback in the first half of 2018. The pullback was most acutely felt in Emerging Markets, which fell 8% in Q2 2018 due to both exogenous factors (tariffs and trade wars) and endogenous ones (poor economic policy decisions and the rise of populist leaders). Most of the gains internationally were in the information technology and energy sectors, while losses were concentrated in high dividend sectors, telecommunications, and consumer staples. In private markets, record levels of fundraising and dry powder combined with robust debt markets drove private equity valuations to new peaks. High valuations and strong M&A markets led to a seventh consecutive year of distributions outpacing contributions, compelling investors to commit more capital to the asset class. During the 12 months ending March 31, 2018, Cambridge Associates’ global private equity benchmark generated a pooled IRR of
FISCAL YEAR 2018 ENDOWMENT HIGHLIGHTS:
18.0%, led by non-US private equity which generated a pooled IRR of 22.9%. Private energy markets benefited from the rebound in oil prices, but weak M&A markets and unreceptive public markets made exits difficult and scarce. Cambridge Associates’ natural resources benchmark generated a pooled IRR of 5.8% in the 12 months ending March 31, 2018. After seven interest rate increases by the Fed, investors are finally being paid to hold cash again. The three-month Treasury bill now yields the same 2% as the S&P 500 Index, and the two-year US Treasury yield of 2.5% is the highest level since 2008. The ten-year US Treasury yield also increased from 2.3% to 2.9% during the year. With a rise in both short-term and long-term rates, the US Barclays Aggregate Index declined -0.4%. Credit spreads have risen off January lows, which were approaching their pre-crisis levels, but are still tight in light of the embedded risk. Corporate leverage levels are high (average debt levels for LBO transactions are 6.5x) and EBITDA growth faces headwinds with rising input and labor costs. We remain cautious about future returns. Global economic prospects are diverging and becoming more uncertain, threatening the synchronized growth that powered markets higher with so little volatility in 2017. The US economy, driven by the recent tax cuts, continues to fire on all cylinders, but inflationary pressures abound due to labor shortages, nationalist trade policy measures, and a rise in the US deficit. In contrast, Europe and Japan have experienced deteriorating economic momentum, and Emerging Market prospects have worsened in proportion to each country’s sensitivity to USD strength, US interest rates and the price of oil. The Endowment remains committed to meeting its return objectives through disciplined asset allocation and superior manager selection while remaining vigilant about these exogenous risk factors.
CAPITAL MARKETS PERFORMANCE AS OF FISCAL YEAR END 2018
US EQUITY
1 YEAR
3 YEARS
5 YEARS
10 YEARS
NASDAQ 23.7% 16.0% 18.6% 14.0% RUSSELL 2000 17.6% 11.0% 12.5% 10.6% S&P 500 14.4% 11.9% 13.4% 10.2% _______
INTERNATIONAL EQUITY
MSCI AC ASIA EX-JAPAN 9.9% 7.0% 8.2% 5.8% MSCI AC WORLD EX-US 7.3% 5.0% 6.0% 2.5% MSCI EMERGING MARKETS 8.2% 5.6% 5.0% 2.5% _______
FIXED INCOME
BARCLAYS AGGREGATE -0.4% 1.7% 2.3% 3.7% BARCLAYS 5-YR OTR TIPS 1.2% 1.2% 0.9% 2.4% MERRILL LYNCH HY MASTER II 2.5% 5.6% 5.5% 7.1% _______
MARKETABLE ALTERNATIVES
HFRI EQUITY HEDGE HFRI FUND OF FUNDS HFRI EVENT DRIVEN
8.3% 5.2% 5.5%
4.9% 2.1% 4.4%
5.9% 3.3% 4.4%
4.7% 1.5% 4.6%
2018 ENDOWMENT REPORT | 5
E N DOWMENT RET URNS POOLED POLICY PORTFOLIO
POLICY PORTFOLIO
The market value of the Pooled Endowment was $1.006 billion as of June 30, 2018. The investment of Tulane University’s endowment assets is governed by the Investment Policy Statement, which is reviewed at least annually by the Endowment Management Committee of the Board of Administrators. This document sets forth governance principles, investment objectives, and risk parameters. The Policy Portfolio for the Pooled Endowment included in the Investment Policy Statement represents the expected allocation of assets that will satisfy these return objectives and risk parameters. While formulated based on long-term data series, the Policy Portfolio is dynamic and responsive in its implementation to prospective economic conditions, risks and opportunities presented by market dislocations. The static benchmark uses the weights of the Policy Portfolio as shown to the right and serves as one of the Pooled Endowment’s performance benchmarks. Over the long term, the goal is to preserve the purchasing power of the endowment after spending and inflation.
Cash 1.0%
Fixed Income 9.0% Private Real Assets 10.0%
Global Equity 35.0%
Public Real Assets 5.0%
Marketable Alternatives 25.0% Private Equity 15.0%
HISTORICAL PERFORMANCE (NET OF FEES)
15%
10.8% 10%
9.2%
9.4% 8.0%
7.9% 6.3%
6.9%
7.4%
6.6%
6.2%
5.6%
6.6%
5%
PAULA BURCH-CELENTANO
0%
6 | 2018 ENDOWMENT REPORT
-5%
1 YEAR POOLED
3 YEARS STATIC BENCHMARK
5 YEARS
10 YEARS SPENDING + CPI
EN DOWM EN T RET U RN S POLICY PORTFOLIO Cash 1.0% Fixed Income 25.0%
Global Equity 51.5% Private Real Assets 2.5% Public Real Assets 7.5%
SALLY ASHER
Marketable Alternatives 10.0% Private Equity 2.5%
EMINENT SCHOLARS POLICY PORTFOLIO The Endowed Chair and Endowed Professorship programs under the Louisiana Board of Regents matching program are collectively known as the Eminent Scholars Endowments. The investment of these assets is governed by the same Investment Policy Statement as the Pooled Endowment. However, the Eminent Scholars’ Policy Portfolio is tailored to satisfy specific conditions of this matching program. These conditions include greater reliance on public stocks and bonds and limited use of hedge funds and private capital. The resulting benchmark for the Eminent Scholars endowments shown to the right is therefore different from that of the Pooled Endowment. Despite these differences, both the Eminent Scholars and Pooled Endowment portfolios have generated similar 3 and 5-year annualized returns. In recent years, the conditions of the matching program were broadened allowing for a more dynamic, diversified asset allocation. Mindful of the conditions under which these funds are generously matched by the state, many of the same investment managers and strategies are used in both portfolios.
HISTORICAL PERFORMANCE (NET OF FEES)
15%
10%
8.8%
8.5% 7.3%
8.0%
7.2%
6.9%
7.0% 6.6%
6.0%
6.8% 5.6%
6.5%
5%
0%
1 YEAR EMINENT
3 YEARS
5 YEARS
STATIC BENCHMARK
10 YEARS CPI + 5%
2018 ENDOWMENT REPORT | 7
E N DOWMENT RET URNS
8 | 2017 ENDOWMENT REPORT
EN DOWM EN T RET U RN S ASSET CLASS SUMMARIES GLOBAL EQUITY
private credit commitments, including an aircraft leasing strategy. A relationship with a global macro manager was terminated.
The Endowment’s Global Equity portfolio is comprised of 14 managers who invest in publicly-listed companies across US and international markets. The portfolio aims to capture the growth of the global economy and invests alongside fundamentally-focused managers, who employ differentiated strategies to outperform passive indices. During the fiscal year, the portfolio returned 11.1%, outperforming the 10.7% return of the MSCI All Country World Index. Both the domestic and international portfolios beat their respective benchmarks and contributed to the outperformance. The Global Equity portfolio has outperformed its benchmark over the last three-, five-, and ten-year periods as well. The team added two managers during the year, including a Japan-focused small cap value manager.
PUBLIC REAL ASSETS
PRIVATE EQUITY
The Endowment’s Private Real Assets portfolio primarily consists of energy, real estate, and to a lesser extent mining exposure. The recovery in energy prices and impressive operating results at portfolio companies drove the portfolio’s strong return of 13.1% during the year, well ahead of its benchmark’s return of 10.7%. We have experienced strong gains in recent quarters but believe there is significant additional imbedded value in the energy portfolio, which will be realized as M&A volume picks up and the public markets become more receptive to IPOs. During the year, we added a new diversified energy manager and re-upped with two managers; one focused on opportunistic real estate and the other on middle market energy.
The Endowment’s Private Equity portfolio consists of 34 firms investing globally across buyout, venture capital, growth equity, and distressed strategies. The portfolio generated a spectacular return of 22.6% during the year on a mark-to-market basis, primarily driven by strong company-level growth, M&A activity, and initial public offerings. Our team was very active during the year, adding three new buyout managers, two focused on the consumer sector, and one focused on industrial turnarounds. In addition, we re-upped with five of our top managers including two focused on middle market buyouts; two focused on small market buyouts and one focused on education technology venture.
MARKETABLE ALTERNATIVES The Endowment’s Marketable Alternatives portfolio aims to achieve attractive risk-adjusted returns that are uncorrelated to traditional asset classes, providing valuable diversification and downside protection in times of market stress. The Marketable Alternatives portfolio consists of 20 managers providing exposure to strategies such as long/short equity, multi-strategy, event-driven, alternative risk premia, as well as private and opportunistic credit. During the fiscal year, the Marketable Alternatives portfolio returned 6.7% versus the HFRI Fund of Funds Composite return of 5.1%, with positive returns across all three sub-strategies. A long/ short TMT manager and an Asia manager were the largest contributors to returns. Additionally, a CLO manager continued to perform well, capitalizing on spread compression in mezzanine tranches. A new alternative risk premia strategy detracted from returns. The fiscal year saw activity in both new additions and redemptions across the portfolio. The Endowment added two new long/short equity funds, an alternative risk premia fund, and made three new
The Endowment’s Public Real Assets portfolio is intended to protect against unanticipated inflation and liquidity for growing the Private Real Assets portfolio. Inflationary spikes can manifest in various ways, so Tulane holds a diversified mix of assets to hedge against inflation risk. The portfolio currently has exposure to assets such as LIBOR based re-performing mortgage securities, MLPs and energy futures, primarily oil. Inflation marginally ticked up during the year, and Tulane’s exposure performed well, returning 15.1%. We added to our exposure in Q1 of 2018 following a pull-back in the price of oil.
PRIVATE REAL ASSETS
FIXED INCOME The Endowment’s Fixed Income portfolio includes exposure to US Treasuries, investment grade bonds, and high-quality mortgage-backed securities. Fixed income generally provides moderate returns and dampens volatility by serving as a hedge against deflation and negative events in the equity markets. We view this portfolio as a liquidity pool under crisis conditions. Fixed Income markets remain challenging as the Fed continues to raise the fed fund rate, albeit gradually, and unwinds the Fed’s $4.4 trillion balance sheet. The Tulane fixed income portfolio generated a modest positive return of 74 basis points, outperforming the Barclay’s Aggregate Index by 114 bps, which returned -0.4%. We remain underweight the asset class and cautious, with a duration of approximately half that of the index.
2017 ENDOWMENT REPORT | 9
EN DOWMENT RET URNS TOTAL POOLED AND EMINENT SCHOLARS VALUE ADDED Together, the Endowment Management Committee and Staff strive to add value over the Policy Portfolio through manager selection, constructive asset allocation, and tactical implementation without adding undue risk. As shown in the graph to the top right, our collective effort over the last nine years has produced $117.6 million of additional value. During this period, the Endowment has also had a lower realized volatility. Our collective investment process seeks to continuously enhance the risk-adjusted returns of the portfolio given the current economic environment to preserve the purchasing power of the Endowment over time.
ENDOWMENT PERFORMANCE VS. CAMBRIDGE PEERS
JENNIFER ZDON
A wide variety of metrics, such as a constructed asset class benchmark based on our policy portfolio or a passive market index, are used to evaluate the performance of our portfolios. Most importantly, we measure our long-term results versus our principal objective, which is to preserve the purchasing power of the Endowment after spending and inflation. However, we also pay attention to how our colleagues at other foundations and endowments manage similar long horizon portfolios. In this regard, Tulane had an exceptional year given that the average endowment returned 8.1% and the cutoff for top quartile was 9.2%. Of the ~415 institutions reporting to Cambridge Associates, Tulane’s 10.4% for fiscal year 2018 is among the top 25% of all returns in the country. More importantly, our three-, five-, and ten-year returns also fall in the top quartile. But much like U.S. News & World Report rankings, these data points make for good cocktail chatter but are not our primary objective. We have immense respect for our industry colleagues, each of whom has a unique risk profile driven by institutionally specific criteria. We often invest in many of the same managers and openly share our research and analysis. And so, while our peer ranking is noteworthy, it is just one metric among many that we use to evaluate results.
10 | 2018 ENDOWMENT REPORT
EN DOWM EN T RET U RN S $140.0
POOLED + EMINENT VS. STATIC BENCHMARKS
$+117.6
$120.0
$17.3
$100.0
$37.2 $80.0
-7.0 $30.6
$60.0 $40.0
$13.0 -$12.7 $15.1
FY 10
FY 11
$20.0
$22.1 $2.1
FY 12
FY 13
FY VALUE ADDED
FY 14
FY15
FY16
FY17
$-
FY18
CUMULATIVE VALUE ADDED
TULANE PERFORMANCE COMPARED TO ENDOWMENT COMPOSITE (PERIODS ENDING 6/30/2018)
14.0%
TOP 5% 12.0%
TULANE
10.0% 8.0%
25%–50% 50%–75%
X
X
X 6.0%
X
X
MEDIAN BOTTOM 5%
4.0% 2.0%
1 YEAR
TULANE 10.4% TOP Q 9.2% MEDIAN 8.1% N 415
3 YEARS
7.7% 6.6% 6.0% 412
5 YEARS
9.3% 7.8% 7.1% 406
10 YEARS 6.2% 6.1% 5.5% 380
Peer data from Cambridge Associates Final 6/30 data as of October 25, 2018
2018 ENDOWMENT REPORT | 11
E N DOWMENT RET URNS 5 YEAR PERFORMANCE VS. CAMBRIDGE PEERS Tulane’s Endowment has enjoyed particularly strong results over the last five years. Generally, strong returns should be viewed with skepticism since higher returns are often the result of taking additional risk. One way to place return and risk into context is to measure the return generated per unit of risk taken, typically calculated via the Sharpe ratio. Over the last five years, Tulane’s Endowment has generated an average annual compound return of 9.3%, ranking in the 91st percentile among peer institutions. Over that same period, the risk of the Endowment, measured by the standard deviation of returns, was just 4.1%, ranking in the 5th percentile. As a result, the Endowment’s Sharpe ratio, or the return per unit of risk, was an extraordinary 2.1x, ranking 6th among peers. The combination of strong manager selection, unusually muted market volatility and Tulane’s specific asset allocation has resulted in exceptional results over the last five years.
RISK VS. PEERS (LAST 5 YEARS)
AACR TULANE UNIVERSITY
4 5 6 7 8 9 10 STD DEV
TULANE UNIVERSITY
4 5 6 7 8 9 10 SHARPE RATIO
TULANE UNIVERSITY
0.9 1.1 1.3 1.5 1.7 1.9 2.1
Source: Cambridge Associates
12 | 2018 ENDOWMENT REPORT
EN DOWM EN T S U PPO RT
Tulane University’s Brain Institute has received a $1 million pledge from the Priddy Family Foundation to endow and establish the Priddy Family Spark Research Endowed Fund. The fund will provide competitive awards to faculty for early-stage research support that advances the research priorities of the brain institute.
PAULA BURCH-CELENTANO
Tulane Brain Institute receives $1 million pledge from the Priddy Family Foundation
“We are very excited about our involvement with the Tulane Brain Institute and are honored to be a part of such a great undertaking,” said Robert Priddy. “After years in venture capital, I know when I see a quality venture and investing in early-stage scientific research at Tulane will have tremendous returns for humanity in the future.” The criteria for awards from the Priddy Family Spark Research Endowed Fund will be based on the scientific merit of the project, the potential to elevate the national visibility and reputation of the Tulane Brain Institute, and the potential for future support from competitive national funding agencies. “We are very excited about our involvement with the Tulane Brain Institute and are honored to be a part of such a great undertaking.” The awards will support early-stage research and bridge funding, including stipends for graduate and undergraduate research assistants. “This remarkable gift will allow the Tulane Brain Institute faculty to take risks in their research as they test early-stage ideas and gather pilot data to increase their competitiveness for external funding,” said Laura Levy, vice president for research at Tulane. “The gift will provide long-term support for the kind of bold and innovative research that could lead to real breakthroughs in our ability to understand and treat brain disease.” Robert Priddy spent 30-plus years in aviation, starting three airlines from scratch, all of which were successful operations and ultimately sold to larger airlines. He then spent several years in personal venture capital investing before co-founding Comvest Investment Partners, a private equity fund managing over $3 billion in assets in both equity and debt funds. Since retiring, he manages his personal investments as Chairman of RMC Capital, LLC.
2018 ENDOWMENT REPORT | 13
E N DOWMENT RET URNS SEPARATELY INVESTED FUNDS Large endowments, typically $1 million or more, which are not invested in the Pooled Endowment due to specific donor restrictions are invested separately. These funds are overseen by the Department of Treasury and Trust Investment Office in New Orleans. At fiscal yearend, the Separately Invested Endowment Funds totaled over $152 million. They are comprised of common stock, fixed income, private equity, venture capital, money market, and donor-directed externally managed accounts.
GIFT ANNUITIES AND LIFE INCOME TRUSTS Tulane University Life Income Trusts and Annuities totaled almost $19 million as of June 30, 2018. Most of these assets are managed by State Street Global Advisors (SSGA), and payments are made to the donor or other designated beneficiaries for a specified term or life of the beneficiaries. The remainder assets are typically contributed to Tulane’s Endowment. These funds are comprised of common stock, fixed income, and real estate investment trusts. The asset allocation is determined based on age of beneficiaries, term of trust, payout rate, and any special circumstances.
MARKET VALUE
Murphy Institute
$86.2
Celia Scott Weatherhead
$30.2
Samuel Stone CIPR Trust
$16.1
Aron Endowment Fund
$7.6
Vanselow/Pediatric
$3.5
All Others Combined
$8.9
TOTAL SEPARATELY INVESTED
14 | 2018 ENDOWMENT REPORT
$152.4
PAULA BURCH-CELENTANO
SEPARATELY INVESTED ENDOWMENT FUNDS
PAULA BURCH-CELENTANO
STA F F
JEREMY CRIGLER, CHIEF INVESTMENT OFFICER
Jeremy joined the Investment Management Office in January 2008 and is responsible for all aspects of managing the endowment and related assets. His 25+ years of investment experience include Senior Investment Officer at Cornell University and Investment Director at Duke Management Company. He has a BSM in Finance from Tulane’s A. B. Freeman School of Business and an MBA from the Fuqua School of Business at Duke University. He is also a member of the Board of Trustees of Cardigan Mt. School and Chairs the Investment Committee.
RICHARD CHAU, MANAGING DIRECTOR
Richard joined the Investment Management Office in September 2013. Prior to Tulane, he helped manage a multi-billion dollar global private equity portfolio in Bessemer Trust’s Private Equity Funds Group. Before Bessemer, Richard worked in the investment office at The Andrew W. Mellon Foundation. His previous experience also includes investment banking at Houlihan Lokey and investment consulting at Cambridge Associates. Richard has a BA in Economics and Chinese from Williams College and an MBA from Columbia Business School.
JULIA MORD, MANAGING DIRECTOR
Julia joined the Investment Management Office in May 2014 and is responsible for all public markets investing. From 2006 to April 2014, Julia was an investment officer at AI International, an NYC-based family office, where she was responsible for co-managing a multi-asset class portfolio. Prior to her experience at AI International, Julia worked at Jefferies & Company and Ernst & Young. Julia has a BA in Economics from the University of Chicago, an MBA from The Wharton School at the University of Pennsylvania, and is a CAIA charterholder.
PAUL WEAVER, DIRECTOR OF INVESTMENT ACCOUNTING
Paul joined the Investment Management Office in September 2008. From 2005 to 2008, Paul worked at OpHedge Investment Services as Director of Fund Accounting where he was responsible for managing the accounting group and for calculating NAVs of large, complex hedge funds. Before OpHedge, Paul had over 20 years of experience working in various accounting related roles for both hedge funds and large financial firms. Paul holds an MBA with a concentration in International Finance from Pace University.
2018 ENDOWMENT REPORT | 15
STAFF JAKE KRIEGSFELD, INVESTMENT ASSOCIATE
Jake joined the Investment Management Office in June 2013 after previously completing an internship with the Office. He graduated summa cum laude from Tulane’s A. B. Freeman School of Business in 2013 with a BSM in Finance and as a member of the William Wallace Peery Society, which recognizes 15 graduating seniors for academic excellence. Jake also earned a minor in Spanish and completed an international business program in Madrid, Spain. Jake is a CFA charterholder.
BRAD BAUGUSS, INVESTMENT ANALYST
Brad joined the Investment Management Office in July 2015 after completing an internship with Intrepid Capital Management the previous summer. He graduated cum laude from Tulane’s A. B. Freeman School of Business in 2015 with a BSM in Finance and Economics and a Specialization in Entrepreneurial Management. Brad has passed all three levels of the CFA program.
EDWARD ROMAN, INVESTMENT ANALYST
Edward joined the Investment Management Office in August 2018 after completing an internship with the Office. He graduated magna cum laude from Tulane’s A. B. Freeman School of Business in 2018 with a BSM in Finance and Management Consulting and a minor in Economics. Edward is a CFA Level I candidate.
JANINE JANDROSITZ, DEPARTMENT ADMINISTRATOR
Janine joined the Investment Management Office in August 2016. Before joining the team, she worked for ten years as the VP of Administration for Lincoln Healthcare Leadership where her role encompassed Human Resources and Office Management. She also worked as an Executive Assistant for Greenbriar Equity. Janine has a BS in Business Management from the University of Redlands.
ROBERT LYCOUDES, PERFORMANCE ANALYST
PAULA BURCH-CELENTANO
Robert joined the Investment Management Office in January 2017. From November 2014 to January 2017, Robert worked in the Margin Lending department at Goldman Sachs. Before that, he worked at Interactive Brokers and interned at UBS Private Wealth Management. He received his BS in Mathematics and Finance from Sacred Heart University in 2012.
16 | 2018 ENDOWMENT REPORT
SALLY ASHER
LO C AT I O N
LOCATION, LOCATION, LOCATION As one of the first universities to locate their investment office away from campus—1,354 miles away in Darien, Connecticut—Tulane has been recognized for its innovative approach to endowment management, paving the way for several other schools to follow our path and locate off-campus. Our motivation to locate the office in the New York City region was to provide staff with the best possible access to investment managers, research firms and industry conferences that are frequently held within the New York and Boston corridor. The central location allowed the team to participate in over 800 manager meetings, calls, and conferences in fiscal year 2018 alone. Conveniently located right off of the Metro North rail line and I-95, the office location allows for a quick trip into Manhattan or other nearby financial centers including Greenwich, Stamford, Boston, and Washington, DC. 2018 ENDOWMENT REPORT | 17
Mussafer Hall Built in 1902 as Richardson Dormitory, the original structure was later designated as the Social Sciences building. Following that, it was the home of the School of Social Work for more than 50 years. In 2018, Mussafer Hall became the home of undergraduate academic services. Original building design - Andry and Bendernagel Renovation design - Studio WTA Tulane gratefully acknowledges this building’s long history. September 2018
Tulane University • Investment Management Office • 9 Old Kings Hwy, South • Darien, CT 06820 • (203) 716-8470