Posted - 26 Apr 2012 16:55 GMT
updated - 26 Apr 2012 17:08 GMT
Cornell loses head of private equity
Ahmad Ali, who led the private equity programme since at least 2006, left in late February, just one in a host of leading LPs who have left their positions in the last year.
Ahmad Ali, the head of the private equity programme at Cornell University’s endowment, left his position earlier this year, according to sources and the school’s investment office.
A receptionist who answered the phone at the investment office said Ali resigned on 29 February. A separate limited partner source at a different university endowment also said Ali resigned. Ali had headed up the programme since at least 2006, when he was interviewed by Institutional Investor magazine. He started at the endowment in 2003 as senior investment analyst in private equity and real estate.
Ali declined to comment and Cornell’s communications office did not return calls for comment.
Cornell’s endowment, which had $5.2 billion in assets as of July, had a target for private equity of 15 percent and an actual allocation of 19.5 percent. The endowment also targeted 12 percent for real estate, with an actual allocation of 11.9 percent, as of 30 June, 2011, according to the university’s fiscal year-end report.
The private equity portfolio was a strong performer for the endowment in the last fiscal year, helping to drive the fund’s overall 19.9 percent return in fiscal 2011, according to the annual report.
“Performance in the private equity portfolio was very strong in fiscal year 2011 reflecting the robust IPO market at the end of the calendar year 2010,” the endowment said.
The investment team has experienced some turnover recently. Michael Abbott, the endowment’s chief investment officer, left abruptly in May 2011 and was replaced by interim CIO AJ Edwards. Abbott had replaced James Walsh in November 2010 after Walsh stepped down after more than three years at the helm.
Ali is just one of many long-time private equity LP leaders that have left their positions over the past year. The US public pension realm in particular has seen a lot of movement of private equity chiefs, which has caused concern among some industry observers that institutional knowledge of the asset class -- including strong relationships with managers -- could be lost.
"I don't think there's enough value put into institutional knowledge," one public pension private equity officer told Private Equity International in a recent interview. "It's a tough decision with the compensation structure [at public pension systems] to stay there a long time. People need to go out and make money."
Many large endowments use an investment management company structure, which provides the investment team some independence from the general budgets and allows for compensation packages more in-line with the private sector. For example, Jane Mendillo, CIO at Harvard Management Company, received total compensation of $4.7 million in 2010.
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