The University endowment has shown a “strong rebound” from last year, but Penn is still faced with serious economic realities, according to a statement from Executive Vice President Craig Carnaroli.
The Associated Investments Fund, which constitutes the majority of Penn's endowment investments, has returned 13.7 percent as of December 31, 2009 — the close of the second quarter in fiscal year 2010. This is “ahead of the benchmark,” according to Carnaroli.
Penn's total endowment is valued at approximately $5.8 billion, up from $5.17 billion at the close of FY 2009. Endowment goes toward purposes that tuition does not fully cover, including faculty support, financial aid and research.
The value of a dollar invested in the Associated Investments Fund is now within five percent of its June 2008 value, according to Carnaroli.
Penn President Amy Gutmann said this means that Penn's "planning is on track" for this year. As long as the market remains more or less in its current position, Penn will not have to cut into student services, she said.
Still, Gutmann remains "wise enough not to predict what the market will do” next year.
Peer institutions are also struggling with the economic climate.
Princeton University is projecting a 10-percent increase in its approximately $12.6 billion endowment during FY 2010, according to the Daily Princetonian.
Harvard University’s endowment is valued at $26 billion, making it the largest of any U.S. university. Harvard plans to sell around $500 million in assets out of a roughly $5 billion real estate portfolio, the Wall Street Journal reported in February.
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