Or is this the primary/hedge-fund part of the university rather than the professional sports organization or the vestigial academic departments?
In UMich's case, the State of Michigan only covers 3% of the entire funding for UMich. The university needs to foot the bill for the remaining 97% on their own [0].
That's where endowments come in. By trying to be savvy with the rate of return on your endowment, you can create a self sustaining budget for your institution.
Also, UMich Ann Arbor's yearly budget is $10 Billion, but their endowment (aka their piggybank) is only $17 Billion. If they raided their piggybank, they could only keep the lights on for 2 years at most.
> professional sports organization or the vestigial academic departments
Professional Sports is self funded by the athletics department.
What's a "vestigial academic departments". For example, Computer Science was "vestigial" in most universities until the 1970s, often being a wonky major in the Math or Physics department. What makes you an arbitrator for what field is more important than others?
[0] - https://publicaffairs.vpcomm.umich.edu/key-issues/tuition/ge...
Smaller universities seem to make a lot on student rental accommodation, at least in places like Australia.
Maybe tuition is their side business.
Specifically, regarding property, at schools I’ve attended they owned real estate in the city around the campus, not just the campus itself. Part of that is investment and part of it was looking to the future for when they run out of space on the current campus to build new facilities and need to grow the campus
We don’t think of pension funds as hedge funds either but they also invest heavily to grow the fund.
https://en.wikipedia.org/wiki/List_of_colleges_and_universit...