University of Michigan, Ann Arbor, has approved up to $202 million in alternative and absolute-return commitments and also disclosed up to $342 million in alternative commitments from its $18.2 billion long-term endowment pool, according to documents from its board of regents meeting.
In absolute return, the board at its Sept. 21 meeting committed up to 1% of its assets, or $182 million, to the Millstreet Credit Fund, which is managed by Millstreet Capital Management. The manager seeks to "opportunistically invest in a diversified portfolio of long and short investments in the often mispriced small- and mid-capitalization segment of the U.S. corporate high yield fixed-income market," according to board documents.
In alternatives, the board committed $10 million to venture capital fund Aurelia Foundry I, and $10 million to Black Operator Fund I, which is managed by venture capital firm Black Ops Ventures and primarily invests in seed-stage companies in the U.S. and Canada with at least one Black founder.
UM also disclosed a series of commitments made from October 2022 through July. The university's investment office has authority to invest in new funds and strategies offered by existing managers, and direct investments that represent less than 1% of the endowment pool, without approval by the board.
The university committed up to $150 million to two funds managed by Five Point Energy, which develops and operates midstream assets in North America, with a focus on water and waste in the Permian Basin, according to board documents.
A UM spokesman declined to provide further details about the Five Point commitments, or any of the other disclosed commitments.
Also, UM committed $75 million to a fund managed by Merit Hill Capital, which acquires value-added self-storage facilities throughout the U.S.; up to $70 million to two fund managed by Kaszek Ventures, a venture capital firm that makes investments in seed-stage and early-stage companies across Latin America; and ¥7 billion ($47 million) to a fund managed by Star Asia Group, which invests in private real estate and real estate-related assets in Japan, board documents note.
