OT: Endowments

[Aughnanure]

Thought this was interesting

Marquette is up to $401 million. Here are the other potential New Big East additions along with the C7.

RICHMOND - 1,877,193,000
GW - 1,331,101,000
GEORGETOWN - 1,160,291,000
SAINT LOUIS - 880,251,000
UMASS - 529,262,000
DAYTON - 414,504,000
MARQUETTE - 401,208,000
CREIGHTON - 375,221
VILLANOVA - 370,292,000
ST JOHN'S - 359,494,000
VCU - 349,699,000
DePAUL - 348,255,000
SETON HALL - 231,734,000
ST JOSEPH'S - 173,115,000
DUQUESNE - 171,119,000
BUTLER - 157,549,000
ST MARY'S - 127,891,000
GONZAGA - 121,220,000
XAVIER - 119,509,000


http://www.nacubo.org/Documents/research/2011NCSEPublicTablesEndowmentMarketValues319.pdf

[GGGG]

VCU is pretty impressive for being a UWM-like public institution.

[brewcity77]

I had no idea Richmond had close to a $2B endowment.

[Dr. Blackheart]

I had no idea Richmond had close to a $2B endowment.

A lot of tobacco money in them parts of Virginia. That is a cash business and they need places to store it so the lawyers don't hunt them down.

[Silkk the Shaka]

A lot of tobacco money in them parts of Virginia. That is a cash business and they need places to store it so the lawyers don't hunt them down.

But well above Georgetown's?  Fairly shocking.

[frozena pizza]

A lot of tobacco money in them parts of Virginia. That is a cash business and they need places to store it so the lawyers don't hunt them down.

It is surprising, especially given how small it is.  But southern schools tend to get more donations from alums.

I'm kind of warming up to the idea of having Richmond in the new conference.

[chapman]

A very nice change for MU from 2010 to 2011.  I know it was a priority to increase the endowment, and it looks as if they have started making good on that.  Increase of 23.1%, where average on the list was 17.9% and median of 20.0%.

[Silkk the Shaka]

It is surprising, especially given how small it is.  But southern schools tend to get more donations from alums.

I'm kind of warming up to the idea of having Richmond in the new conference.

Seriously - if they ever really wanted to upgrade and compete with the big boys, they could probably do so in a hurry.  The Al cost us $30-35 million, was a huge fundraising effort, and represented over 10 - 15% of our endowment at the time.  Even adjusting for inflation, if Richmond wanted to build a comparable or superior facility at $50 million in today's dollars, that's about 2.5% of the current endowment, and would surely not require the same dramatic fundraising effort aided by a magical final four run with a once in a generation player.  Heck, just an upgrade to the New Big East conference is probably all the momentum they would need to get that done.

Might not be the worst thing in the world to expand to 10 initially with the obvious X, Butler, and TBD, then tell those still in the running we will take 2 more in a few years, giving each time to prove their dedication to upgrading its program.  It would be interesting to see that kind of arms race.  Probably also a complete fantasy scenario that would never actually play out.

[warriorchick]

Seriously - if they ever really wanted to upgrade and compete with the big boys, they could probably do so in a hurry.  The Al cost us $30-35 million, was a huge fundraising effort, and represented over 10 - 15% of our endowment at the time.  Even adjusting for inflation, if Richmond wanted to build a comparable or superior facility at $50 million in today's dollars, that's about 2.5% of the current endowment, and would surely not require the same dramatic fundraising effort aided by a magical final four run with a once in a generation player.  Heck, just an upgrade to the New Big East conference is probably all the momentum they would need to get that done.

Might not be the worst thing in the world to expand to 10 initially with the obvious X, Butler, and TBD, then tell those still in the running we will take 2 more in a few years, giving each time to prove their dedication to upgrading its program.  It would be interesting to see that kind of arms race.  Probably also a complete fantasy scenario that would never actually play out.

Sultan, correct me if I am wrong, but you normally don't "spend" endowment funds.  You spend the investment income the endowment generates.  

In tough market years, 2.5% of our endowment could very well be all of the endowment income.  And that's not even considering that a significant amount (if not most) of endowment income is earmarked for specific uses, such as merit scholarships.

[Canned Goods n Ammo]

Might not be the worst thing in the world to expand to 10 initially with the obvious X, Butler, and TBD, then tell those still in the running we will take 2 more in a few years, giving each time to prove their dedication to upgrading its program.  It would be interesting to see that kind of arms race.  Probably also a complete fantasy scenario that would never actually play out.

This would be ideal, I don't know if it is possible, but it would be ideal.

[Silkk the Shaka]

Sultan, correct me if I am wrong, but you normally don't "spend" endowment funds.  You spend the investment income the endowment generates.  

In tough market years, 2.5% of our endowment could very well all of the endowment income.  And that's not even considering that a significant amount (if not most) of endowment income is earmarked for specific uses, such as merit scholarships.

I'm well aware.  It's definitely a strong indicator of spending power potential, however.

[warriorchick]

I'm well aware.

So how do you propose that a college spend that kind of endowment money on basketball?

[Pakuni]

Might not be the worst thing in the world to expand to 10 initially with the obvious X, Butler, and TBD, then tell those still in the running we will take 2 more in a few years, giving each time to prove their dedication to upgrading its program.  It would be interesting to see that kind of arms race.  Probably also a complete fantasy scenario that would never actually play out.

Problem is, if you're looking to strike decent, long-term deals with a television network and sponsors, they're going to want to have some certainty and stability in regards to the conference's membership (and markets). also, i don't think you can assume that a program that might want in today (say Gonzaga, VCU, whoever) will want in 2-3 years from now. Maybe their conferences will enact extremely punitive new exit fees. Maybe they'll be turned off by being jerked around. Maybe they'll decide their best off in their current setup. Who knows.
I think it behooves everyone to pick how many members they want, add those programs and hopefully be done with it for the foreseeable future.

[79Warrior]

Sultan, correct me if I am wrong, but you normally don't "spend" endowment funds.  You spend the investment income the endowment generates.  

In tough market years, 2.5% of our endowment could very well be all of the endowment income.  And that's not even considering that a significant amount (if not most) of endowment income is earmarked for specific uses, such as merit scholarships.

Correct.

[nyg]

Just some others:

Harvard      32 Billion
Yale           19 Billion
Notre Dame  6 Billion

Thats some serious cash.

[Les Nessman]

How does SLU double our endowment? I've lived in St. Louis most of my life and went to Marquette for college. The cities, schools, and student bases are almost the same. Where is all their money coming from?

[Silkk the Shaka]

So how do you propose that a college spend that kind of endowment money on basketball?

I'm well aware.  It's definitely a strong indicator of spending power potential, however.

[frozena pizza]

How does SLU double our endowment? I've lived in St. Louis most of my life and went to Marquette for college. The cities, schools, and student bases are almost the same. Where is all their money coming from?

On the flip side how do we have more than triple Xavier's endowment?  I guess they are a bit smaller but otherwise seems pretty comparable.

[Aughnanure]

It is surprising, especially given how small it is.  But southern schools tend to get more donations from alums.

I'm kind of warming up to the idea of having Richmond in the new conference.

I've liked Richmond over VCU for a while, mostly because of this. Still think VCU/Richmond would be on the outside looking if we added 5.

[WarriorDoc]

I expected Nova and Xavier to be much higher and George Washington and SLU to be much lower.

I have the same question--where is the GW and SLU money coming from, and where is the love from Xavier donors?

[honkytonk]

I was surprised to see Dayton's endowment so high. I went to their website and read that on top of the $400M they have in their permanent endowment, they also have another $700M in a long-term investment pool. WTF?     That's a nice total of $1.1B.

[bilsu]

Endowments use income to provide scholarships, etc. Capital gains(losses) are most likely considered principal, so the value of endowments can be significantly effected by investment results. That also explains the 20% average increase in endowments in 2011 vs 2010, because the market was recovering.

[GGGG]

Sultan, correct me if I am wrong, but you normally don't "spend" endowment funds.  You spend the investment income the endowment generates.  

In tough market years, 2.5% of our endowment could very well be all of the endowment income.  And that's not even considering that a significant amount (if not most) of endowment income is earmarked for specific uses, such as merit scholarships.

I could go on about this for awhile.

First, new rules allow endowments to spend a normalized return.  (EDIT: and this "return" isn't simply income...but both realized and unrealized gains.) For instance, if a school averages a 6% investment return over the course of time, they may decided to spend 4% and keep 2% for inflation.  And they will be do this in up and down years.  

Second, the vast, vast majority of endowments are restricted in some form...scholarships...professorships, etc.  However what these endowments do is allow you to move money around elsewhere.  Let's say that I endow the College of Business at MU with a gift of $50M.  The school gets 4% of that to spend annually...or $2M.  While some of this might be for new efforts to improve the college, some of it might simply replace money that the University allocated to the College, and now the University gets to use elsewhere.  

So how do you propose that a college spend that kind of endowment money on basketball?

For instance, Professor Plumb now has his salaried paid through an endowment...which frees up money that was originally used for his salary, which is now diverted into the basketball program.

How does SLU double our endowment? I've lived in St. Louis most of my life and went to Marquette for college. The cities, schools, and student bases are almost the same. Where is all their money coming from?

A lot of it depends on just a very small number of very large gifts.  SLU might have just gotten more of those.  Or it could be because MU has put a lot of money into building projects and is using charitable gifts for those purposes instead.  Endowment has been a pretty late point of emphasis at MU if I recall.  

[Hards Alumni]

9 inches.

AROUND.

[warriorchick]

 Endowment has been a pretty late point of emphasis at MU if I recall.  

That is what I understand as well.  The Advancement Department has really expanded in the last several years, and now takes up most (if not all)of an entire floor of Zilber.  Butler's Advancement Department (from what I remember from the tour I took last year) is a row of cubes outside of Blue II's office (and I am not making that last part up).