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Highland Targets Nonprofit Sector

02 Nov 2003

Highland Capital Management is boosting its fundraising efforts to the nonprofit sector as the firm sees more interest from these funds in leveraged, distressed and collateralized debt investment vehicles.

Highland Capital Management is boosting its fundraising efforts to the nonprofit sector as the firm sees more interest from these funds in leveraged, distressed and collateralized debt investment vehicles. "We are seeing increased interest in these types of investment products from nonprofits because they are not interest-rate sensitive and because, depending on whether the product is leveraged or not, there is still the opportunity to achieve high alpha even with a conservative investment allocation," said Jack Yang, Highland's partner responsible for business development.

Highland has brought on board Ronald Ernst, formerly director of institutional marketing at Vaughan, Nelson, Scarborough & McCullough, and BernardVonderhaar, former Commonfund managing director for the Southwest and Central U.S., as managing directors to focus on gathering nonprofit assets. He added that because nonprofits are less risk-sensitive than pension plans, high-yield and leveraged debt products would be particularly attractive to them. "Foundations and endowments in particular would be interested in products such as leveraged loans, CDOs, distressed debt and high-yield bonds because they provide consistent returns, even when interest rates are rising," Yang said. Highland has $9 billion in assets under management.

02 Nov 2003