The Texas A&M Foundation, which supports the College Station university, is reviewing its endowment following the departure of its chief investment officer, according to the foundation’s president and CEO.
CIO Ben Wall left at the end of last month for a small local real estate private equity firm, RoseRock Capital Group, his LinkedIn profile shows. The foundation did not name a replacement, and it plans to undertake “a very deliberate and thoughtful search process,” president Tyson Voelkel said.
The foundation’s trustees and remaining investment staffers have taken over managing the portfolio in the interim.
“We are looking at Mr. Wall’s departure as an opportunity to review our nearly $2 billion endowment,” Voelkel told Institutional Investor in an email this week. “I am working closely with my board of trustees to ensure best practices are being utilized in regards to asset allocation, portfolio construction, manager research, risk management, and performance reporting. We will base our search for a new leader on the key areas we collectively believe that will allow the Texas A&M Foundation to maintain the success it has historically had, but also give our endowment the ability to achieve greater outcomes in the future.”
Returns on the university’s long-term investment pool have roughly matched or slightly trailed the average $1 billion-plus nonprofit fund, according to 2018 reports from the foundation and NACUBO-TIAA. Texas A&M gained about 9 percent for the year ending June 30 versus peers’ 9.7 percent. Over five years, A&M’s returns just lagged the 8.2 percent average.
During his tenure, former CIO Wall maintained a large stock portfolio as many other endowments rushed into private equity. A&M’s 9 percent allocation to private equity and venture capital was roughly half the size of the average large endowment’s, figures for the 2018 fiscal year show.
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Energy and natural resources, in contrast, made up 16 percent of the fund — more than double the average 7 percent allocation.
Wall earned $411,763 in total during 2017, the foundation’s most recent IRS filings show. That year, Baylor University in Waco, Texas, paid the CIO of its $1.23 billion endowment CIO nearly $700,000. Private institutions like Baylor typically pay more than their public counterparts.
But even among public universities, many of the high performers have secured $1 million-plus compensation packages for their CIOs, filings show. The $6.6 billion University of North Carolina at Chapel Hill Foundation, for example, paid its investment chief $1.75 million in 2017.