University of Michigan, Ann Arbor, committed a total of $190 million to four alternative investment funds new to the institution's $11.3 billion long-term endowment pool and disclosed $180 million in commitments to existing managers.
University regents approved the investment recommendations of Kevin P. Hegarty, executive vice president and the chief financial officer, at a meeting Thursday, board documents showed.
The largest commitment of $70 million was awarded to General Catalyst Group IX, a venture capital fund managed by General Catalyst Partners. The fund seeks investments in companies that "can disrupt markets and industries which are poised for major change," Mr. Hegarty said in his report to regents.
Regents also approved a $60 million commitment to Regan Credit Opportunities Fund International, managed by Regan Capital. The fund invests in short-dated structured credit instruments collateralized by asset-backed securities such as residential mortgage-backed and agency-backed securities.
The endowment also committed $30 million each to two real estate funds — Penzance DC Real Estate Fund, which invests in office, multifamily and development properties in the Washington metro area and is managed by Penzance Management; and Detroit Renaissance Real Estate Fund, a real estate fund managed by Fortus Partners that invests in single and multifamily properties in the Detroit metro area.
The university also committed a total of $180 million of follow-on investments to five alternative investment strategies managed by existing fund managers of the university's long-term portfolio.
UM's investment office has authority to invest in new funds and strategies offered by existing managers without approval by the board of regents, Mr. Hegarty's report said.
In June, the university committed $75 million to BCP Fund II, natural resources fund managed by Bernhard Capital Partners.
UM also in June committed $50 million to Roark Capital Partners II Sidecar Fund, a private equity fund managed by Roark Capital Group that invests in a holding company, Inspiring Restaurant Brands, alongside Arby's Restaurant Group. Inspiring Restaurant Brands will acquire and manage multiple restaurant companies across the quick service, fast casual and casual dining sectors.
UM investment officers committed $30 million in April to Salient Convexity Offshore Fund, a hedge fund managed by Salient Partners, "which pursues a diversified global macro strategy that employs long and short trades to express asymmetric return opportunities created by the actions of both economic and non-economic actors," the report said.
UM committed $15 million to IndoSpace Logistics Park Ill in August. The real estate fund will continue lndoSpace's strategy of developing and acquiring light manufacturing and industrial facilities in major markets across India. lndoSpace is sponsored by Realterm Everstone, a joint venture created by Realterm Global and Everstone Capital.
The university also committed an additional $10 million to SSG Capital Partners IV in July, said Mr. Hegarty in the transaction report. The private equity fund managed by SSG Capital Management invests in privately negotiated credit instruments in China, India and Indonesia, and may also include Thailand, Singapore and other Southeast Asian countries. The university originally committed $35 million to the SSG fund in December 2016.
