The University’s multibillion dollar investments, which include the University’s endowment, lost $600 million, or 11 percent, in the first quarter of the fiscal year, according to UVA’s Investment Management Company (UVIMCO) quarter-end report. By mid-October, the policy benchmark had declined by another 20 percent.
According to the report, after the initial hit, the investment pool was valued at $4.6 billion. By mid-October pricing, the pool was at $4 billion. UVA’s endowment is currently valued at $2.9 billion.
As UVA officials evaluate the loss, they remain optimistic.
“We believe that our diversified investment strategy and long-term view will serve us well in the current environment as it has in the past,” said Leonard Sandridge, executive vice president and chief operating officer, in an e-mailed statement. “Our 20-year annualized return through September 30 is 13 percent. Our three-year return through September is plus 9 percent.”
Sandridge says this financial crisis may last for several years, but once the markets settle and strengthen, “we intend to be positioned to benefit over the long-term.”
In terms of liquidity, the investment pool is divided between $600 million in bonds and equities, $1.8 billion in hedge funds and $1.6 billion in private funds.
Sandridge attributes the lack of liquidity problems to a strong credit rating. “We have not curtailed our building program; we have not reduced the current year payout from the endowment—in fact, we have increased it to 5 percent; and we have not cut services to our students and patients,” he says.
Despite the tough times, UVIMCO officials expect to invest between $600 million to $1 billion in private funds over the next two years and expect private investments in the current state of the market to “provide exceptional returns.”
C-VILLE welcomes news tips from readers. Send them to news@c-ville.com.
