High expectations for Hall as head of Harvard’s PE program: UPDATED

  • Hall moves to Harvard from Texas Teachers
  • LPs have seen turnover among managers
  • Harvard sharpens its focus on funds

Harvard Management has been without a private equity chief for most of the past 11 months, sister website peHUB reported. Peter Dolan ran the program for 18 years, but resigned in April 2013. The position remained vacant for eight months, until Harvard promoted Lane MacDonald to take over. But after just two months on the job, MacDonald left to be president of Crosby Advisors, a family office.

Hall, who starts the new job in April, was unavailable for comment.

“Hall brings significant and deep expertise across private equity investments, other private assets and global M&A,” Jane Mendillo, the president and CEO of Harvard Management, said in a prepared statement.

Hall faces big expectations. Mendillo expressed disappointment last September with the performance of the endowment’s private equity portfolio, characterizing it as “fair.” The private equity portfolio returned 11 percent in fiscal 2013, which was “well below” the return on public equities and only slightly above the 10.6 percent benchmark Harvard set, Mendillo wrote in a letter accompanying Harvard Management’s fiscal year report.

Because investments in private equity funds are locked up for years before those funds return capital to LPs, Harvard expects an “illiquidity premium” over public markets, Mendillo wrote. “Over the last 10 years, however, our private equity and public equity portfolios have delivered similar results.”

To improve its private equity returns, Harvard is “actively focusing on honing our private equity strategy to maintain the highest concentration in the very best managers with the greatest potential to add value,” Mendillo wrote.

(Update: Texas Retirement System named Eric Lang, senior managing director of real estate, as interim head of private equity and said it would “take some time” to find a suitable candidate, according to a statement.

“Rich’s leadership will be greatly missed at TRS,” according to a prepared statement from the retirement system. ”Under his stewardship, the private equity group has been a top performer compared to industry peers and has won numerous awards.”)

Hall took the private equity helm at Texas Teachers’ in 2012 after another limited partner legend, Steve LeBlanc, decided to leave the public system. Hall had been with the system working on private equity since 2008.

Prior to Texas Teachers’, Hall worked at Banc of America Securities, where he was vice president of real estate investment banking. Before that, he was director of corporate development and strategy at Tomkins.

Earlier in his career, Hall worked in direct investments at Dell Ventures. Before his career in finance, Hall served as an intelligence officer in the U.S. Navy for six years, earning the rank of lieutenant. Hall is also a graduate of Harvard.

Chris Witkowsky is editor of peHUB. Steve Gelsi, senior editor of Buyouts, contributed to this report.