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Can Timber Rebuild Harvard's Endowment?

Jane Mendillo bets on natural resources as she seeks to put the university back on top
Can Timber Rebuild Harvard's Endowment?
Illustration by Pete Ryan

Jane Mendillo boarded a turboprop plane in Brasília in April and flew deep into the Brazilian countryside. The flight took her over dirt roads running through endless hills and valleys and unimaginably beautiful wilderness. But Mendillo, head of Harvard University’s $32 billion endowment, wasn’t there to sightsee. She was visiting tree plantations and inspecting Harvard’s holdings. The pine and eucalyptus trees planted in neat rows that stretch for miles will be used to make charcoal, feed pulp mills and, Mendillo hopes, produce an increasing supply of saw logs for furniture and other consumer goods for a burgeoning Brazilian middle class.

Harvard’s endowment started buying U.S. forestland in 1997, when Mendillo—then a member of the investment team—recommended the purchases to her then-boss Jack Meyer. Now Mendillo, 54, is trying to remake the endowment after the world’s richest university suffered a $10 billion loss on its investments in 2009, a 27 percent drop that was the worst for any school. Amid the global credit crisis, Harvard was unable to unload assets and had to scramble to raise cash. The foundation is all that exists of a planned $1 billion science center begun in 2007 across the Charles River from the main campus in Cambridge, Mass.