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Library foundation assets of $2.5 billion tallied in Wilmington research

The New York Public Library tops the list of library trusts

The bulk of the assets are concentrated in 25 foundations

Library foundations supporting presidential and public libraries have an estimated combined $2.5 billion to $3 billion in assets, according to new research from Wilmington Trust N.A.

The total represents the assets of 1,300 library investment portfolios in the U.S., although the bulk of the assets is concentrated in the 25 largest, accounting for $2.2 billion.

Seeking to crack open the books on a little-examined asset-owner segment, Wilmington Trust has identified the largest foundations, shedding light on an area for prospecting for investment management services, including fiduciary delegation or CIO outsourcing, said Walter J. Dillingham Jr., New York-based managing director-endowments and foundations and co-author of the study.

The segment is a fertile area for growth as municipal libraries, facing government budget restraints, look to build their foundation's source of funding, Mr. Dillingham said in an interview.

“We expect these foundations to grow as fundraising becomes more important” and investment management adds value, he said.

“How they manage assets is important,” Mr. Dillingham said, especially as smaller foundations seek professional investment management.

The New York Public Library and Morgan Library and Museum, a New York-based private institution open to the public, as well as the Brooklyn Public Library are exceptions represented in the list of total assets, Mr. Dillingham said.

With $1.1 billion and $156 million, respectively, the two have the largest investment portfolios of any of the library foundations in the study. Brooklyn Public Library has a $33.4 million investment portfolio, ranking it 14th on the list. But none of these three New York libraries uses a foundation structure for its investments, even though the assets support the library and serve as fund repository for fundraising, Mr. Dillingham said.

Lyndon Baines Johnson Foundation, Austin, Texas, has the third largest library investment portfolio and largest library foundation with $151.4 million in assets, supporting the LBJ library and museum.

It is followed by:

  • the $140.7 million Thomas Jefferson Foundation, Charlottesville, Va., supporting the Robert H. Smith International Center for Jefferson Studies;
  • the $122.2 million Mount Vernon Ladies Association, Mount Vernon, Va., the foundation of the Fred W. Smith National Library for the Study of George Washington;
  • the $106.3 million Ronald Reagan Presidential Library Foundation, Simi Valley, Calif.; and
  • the $59.4 million The Richard Nixon Library and Birthplace Foundation, Yorba Linda, Calif.

In all, nine of the top 25 library foundations — including the three New York libraries as ranked by investment assets, support presidential libraries, accounting for $706 million in assets, the study found.

Presidential library foundations represent about 25% of the assets of the universe in the study, Mr. Dillingham said.

Seattle has the largest public library foundation with $53.4 million, putting it seventh overall in terms of assets among all investment portfolios of libraries with and without foundations.

It is followed by the $53 million George W. Bush Foundation, Dallas; $49 million George Bush Presidential Library Foundation, College Station, Texas, and the $40.7 million San Diego Public Library Foundation.

The study excludes university and college libraries — even though they are among the biggest book and reference work repositories — because they don't have separate investment assets from the school's endowment or foundation funds, Mr. Dillingham said.

“The assets are managed in a variety of ways.” Mr. Dillingham said in an e-mail response to questions. Some of the larger libraries have an internal chief investment officer, while others hire consultants or use discretionary advisers, such as an outsourced CIO.

The New York Public Library, while it has no foundation, has a chief investment officer, Todd M. Corbin, overseeing the investment portfolio, said John Bacon, its director of planned giving. Mr. Corbin couldn't be reached for comment.

“Some of the smaller library foundations work with brokerage firms, banks and boutique firms,” Mr. Dillingham added.

The study didn't collect information on asset allocation or asset management structures.

“Library foundations are similar to other types of foundations in that they typically seek long-term growth and a prudent level of risk,” Mr. Dillingham said.

“Public library foundations are one area of interest for us and we are doing more outreach in this area,” he said.

Wilmington has one client in the segment, overseeing as a full discretionary adviser the $14.7 million in assets of Queens Library Foundation — which ranks 19th on the list in term of investment assets and which supports Queens Borough Public Library, New York, Mr. Dillingham said.

Wilmington, which has an endowment and foundation practice, “usually focuses on small and midsize funds,” Mr. Dillingham said. “We try to help them” by bringing attention through such a study “of areas not well covered to provide peer comparisons of fundraising and other asset management approaches.”