The report delves into the world of family offices—what they are, how they are increasing in number, their future, approaches to hiring and board membership, and much more. It offers fresh insights into their growing presence, asset base, and impact, as well as what makes a family office successful.
To understand these emerging trends, 354 single family offices were surveyed from around the world between September and December 2023.
These offices oversee an average assets under management (AUM) of US$2.0 billion, while the associated families have an average wealth of US$3.8 billion. Collectively, this totals an estimated US$708 billion in AUM and US$1.3 trillion in family wealth.
8 key takeaways with some truly mind-blowing numbers.
1. Family office expansion explodes
• 8,030 single family offices globally today, up from 6,130 in 2019 (31% increase)
• Projected growth: 12% to 9,030 family offices next year
• Expected increase of 33% to 10,720 family offices by 2030
• This represents a 75% increase over a 10-year period
2. Family offices are becoming an economic powerhouse
• In 2019, total wealth for families with family offices was $3.3 trillion
• Today, it stands at $5.5 trillion (67% increase over five years)
• Projected growth: $6.9 trillion by 2025 (26% increase)
• $9.5 trillion by 2030 (73% increase from today, 189% increase from 2019)
• Family offices’ total AUM is $3.1 trillion today, expected to rise to $5.4 trillion by 2030 (73% increase)
• North America is projected to see the greatest increase in family wealth and AUM, with a 258% rise by 2030, followed by Asia Pacific at 208%
3. Establishing multiple family office branches is trending
• 28% of family offices now have multiple branches
• when opening a second office, 9 of 10 of family offices in North America and Europe established secondary branches within their own region
• 61% of family offices in Asia Pacific expanded abroad, with 38% setting up branches in North America and 23% in Europe
• 12% of family offices plan to open another branch in the future
• North America and Asia Pacific are the top destinations, each attracting 34% of planned new branches
4. The face of wealth is being redefined by new money
• 9 in 10 family offices serve first (41%), second (30%), or third (19%) generation families
• 68% of all family offices were established after the millennium
• Only 1 in 10 family offices represent legacy families (4th generation or older)
• Concerns exist around “third-generation curse”
5. Women are reaching the top
• Women serve as the principals of 15% of family offices worldwide
• In North America, women are the principals of 12% of family offices
• In Europe: 20%, Asia Pacific: 18%, Middle East: 10%, South America: 17%, Africa: 21%
6. Valuing governance, family offices strengthen their boards
• 73% of family offices have established boards Boards average four members
• 58% of board members are family members, with the rest being outside professionals
• Board members commonly have backgrounds in strategic planning (64%) and finance, tax, and legal services (64%)
7. Portfolio management and direct investing take up the bulk of family offices’ time, along with administration and compliance duties
• Family offices spend 30% of their time on portfolio management and 22% on direct investing
• 19% of time is spent on administration and compliance duties
• 15% is dedicated to supporting the operating business
• 7% is allocated to next-generation training and 7% to philanthropy
• In North America, family offices spend 27% of their time on administration and compliance, more than in Europe (18%) and Asia Pacific (12%)
8. The future of the family office arena: Expansion and greater sophistication
• 73% of respondents predict the number of family offices will continue to grow
• 66% expect family offices to become more institutionalized and professionally managed
• 55% foresee portfolios becoming more diversified across asset classes and geographies
• 38% believe family offices will transition from being embedded in the family’s business to independent structures
• 36% expect an expansion in the number and extent of services offered
• 33% predict a widespread adoption of operations-based digital technology
• 32% anticipate a stronger focus on sustainable investments and operations
Source: Deloitte Private: The Family Office Insights Series – Global Edition Defining the Family Office Landscape, 2024
Winfort Capital Research
September 2024