GEORGE MASON UNIVERSITY FOUNDATION Faculty Senate Meeting April 3, 2013

2 MISSION STATEMENT The George Mason University Foundation was established in 1966 to advance and further the aims and purposes of George Mason University. It is a 501(c)(3) non-private foundation and a private corporation organized and operated exclusively for the benefit of George Mason University. The Foundation is made of up to forty (40) external trustees who can serve as many as three (3) consecutive three (3) year terms (nine years total) who are called the Board of Trustees (BOT). The Foundation attempts to recruit Trustees who are experts in the areas of real estate, investments, financial management, audit, and fundraising as current Trustees’ terms expire. The Foundation assists Mason in generating and administering private support, in the acquisition, management, and development of Mason’s auxiliary efforts, real property, and other assets that provide strategic support to Mason. George Mason University Foundation, Inc.

3 “ The Foundation is here to help the University meet its aspirations.”  Manage private resources and properties  Manage endowment on behalf of the University  Serve as private partner for PPEAs - Private Public Enterprise Act: Housing VI (Potomac Heights)  Retain private property for current & future University needs: GMUF Arlington Project – Fairfax properties  Broadlands – Loudoun County property

4 George Mason University Foundation, Inc. Purpose Continued  Assist with presidential compensation  Help support University development through funding of development services  Provide services to advance development  Support the aspirations of George Mason University

5 George Mason University Foundation, Inc. Organizational Structure

George Mason University Foundation, Inc. 6 Board of Trustees Executive Committee Audit Committee Development Committee Finance Committee Investment Committee Real Estate Committee Nominating and Governance Committee Mason Intellectual Property Program Subcommittee

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George Mason University Foundation, Inc. Balance Sheet (millions) FY 10FY 11 FY 12 Assets Liabilities Net Assets: Total Unrestricted(1.1) Temporarily Restricted Permanently Restricted GMUF Real Estate LLCs(7.0)(8.1)(11.5) Total Net Assets Total Net Assets & Liabilities

George Mason University Foundation, Inc. Balance Sheet (millions) FY 10FY 11 FY 12 Net Assets: Unrestricted - General Unrestricted – Due to UPMIFA (5.0)(0.8)(4.5) Unrestricted – Broadlands Land Total Unrestricted (1.1) Temporarily Restricted - General Temporarily Restricted - Property 4.2 Total Temporarily Restricted Permanently Restricted GMUF Real Estate LLCs (7.0)(8.1)(11.5) Total Net Assets

10 George Mason University Foundation, Inc. Revenue Sources Budgeted for Fiscal Endowment Fund Management Fee (1.75%) 910,000 Restricted Fund Gift Fee (3.0%) 582,000 Real Estate Management Fees: Housing VI 50,000 GMUF Arlington Campus LLC 0 Mason Administration LLC50,900 Prince William Housing LLC8,900 Prince William Life Sciences Lab LLC17,100 Earned Investment Income 2,092,000 Net Unrestricted Real Estate Income (18,855) In-Kind Rent Revenue93,400 Unrestricted Contributions 250,000 Total Budgeted Unrestricted Revenue Sources 4,035,445

11 George Mason University Foundation, Inc. Operating Expenses Budgeted for Fiscal Foundation Operations 1,188,500 Accounting & Legal 177,000 Insurance 13,900 Investment Advisory Fees 150,000 In-Kind Rent Expense93,400 Depreciation 80,000 Total Budgeted Foundation Operating Expenses for Fiscal ,702,800 Net funds available for University Support2,332,645 Program Benefits to George Mason University 1,427,000 Development Research & Computer Services353,600 University Development Programs547,700 Total Funds Committed to University Program Support2,328,300 Total Budgeted Unrestricted Expenses for Fiscal ,031,100 Budgeted Net Gain Fiscal ,345

12 George Mason University Foundation, Inc. Real Estate Holdings AssessedDebt Mason Administrative Building – University Hall N/A 31,292,041 Potomac Heights - Housing VI N/A 21,925,000 Commerce Building 1 (4085 University Drive)3,821,700 1,111,334 Commerce Building 2 (4087 University Drive)4,291,600 1,309,783 Mathy House (President’s Residence) 1,202,620 0 Mathy Lodge 1,163,320 0 University Park Commercial (4260 Chain Bridge Road)2,622, ,529 University Park Apts (4262, 4264, 4266 Chain Bridge Road)7,883,300 1,444, Kelley Drive (GMU Student Housing Leases) 441, Kelley Drive (Capital Connection Leases) 439,230 0 Shirley Gate Park (11333 Crescent Drive in Shirley Gate Park) 17,000 0 Allman Land (in Alexandria between railroad tracks and I-95) 24,000 0 Broadlands Land (Loudoun County) 12,088, Washington Blvd, Arlington 82,183,200 65,624,234 Prince William Housing LLC N/A 15,625,000 Prince William Life Sciences Lab LLC N/A 33,210,000 TOTAL $116,178,020 $172,496,275

13 George Mason University Foundation, Inc. Restricted Real Estate Holdings with Gift Basis Point of View Estate (Gift from Lynch family) $4,000, Assembly Drive (Gift from James Buchanan) 168,500 TOTAL $4,168,500

14 George Mason University Foundation, Inc. Thank You!!

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16 George Mason University Foundation, Inc Objectives 1) Work to help alumni participation  Working with board members to create alumni interest within their firms  CGI – Michael Waple  Baker Tilly Virchow Krause LLP – John Niehoff  Seeking targets of opportunity to host alumni gatherings in the local community and discuss the importance of participating in the annual fund and alumni activities  Working with alumni board members to gain participation from their network of Mason Alumni 2) Work with the Foundation board and the broader community to increase private support for Student Scholarship money  Include the importance of student financial aid in communication materials to board members, in every board meeting and whenever possible in the broader community  Work to improve communication with donors that have created endowments with the hope that they will increase endowment giving or start new endowments  Manage the investment advisors to get the Foundation endowment competitive with other University endowment funds – It is NOT currently

17 George Mason University Foundation, Inc Objectives (Continued) 3) Improve Communication across the board  Get contact reports and activities recorded in advance  Improve the recently created Foundation ledger e-update for the Board of Trustees to distribute at least quarterly  Work more closely with development officers across campus to assist with cultivation and stewardship activities  Educate the D&D as well as the BOV as to the activities of the Foundation and the financial picture that the Foundation is working with  Ensure that Foundation leadership is on the same sheet of music with University Development and Alumni Affairs staff 4) Support MIPP, Other business opportunities  Need to assist efforts to generate revenue from sources other than gifts  Continue to help Mason with broad real estate strategy where non-educational revenue activities can enhance cash flows to the enterprise

18 George Mason University Foundation, Inc Objectives (Continued) 5) Real Estate Issues  Commerce  Mason has approved test fit  LOI has been drafted and Mason has accepted the terms and structure  Capital Lease needs to be approved by the General Assembly in short session in SP 2013  Arlington  Significant lease and financing risk exists 4 years out  HIS is close to finalizing a lease with GMUF for 10 years in the vacant retail space  John is working with SRA and Mason on a possible space contraction for SRA opening space up for Mason  Continue to help Mason with broad real estate strategy where non-educational revenue activities can enhance cash flows to the enterprise

19 George Mason University Foundation, Inc Objectives (Continued) 6) Governance/Management  Nominating & Governance  New participation rule for trustees added to by-laws  Expand allowable board size to 50 (NOTE: not to deploy now)  Expand Board educational opportunities  Board Activities  Invite Board to “Arts By George”  Invite Board to a reception prior to a basketball game  Piggyback on a Mason Event in the Spring and have a reception for the board with spouses  Encourage increased participation at Alumni/Mason events already planned