While family offices manage some US$3.1 trillion in assets globally, this figure is expected to grow to US$5.4 trillion by 2030, new data from Deloitte has revealed.
Currently, family offices with the greatest investment power lay in North America, with an estimated US$1.3 trillion in assets under management (AUM), while Asia-Pacific (APAC) bolsters a noteworthy US$590 billion.
And until now, North America has been the fastest-growing region, but according to Deloitte, could soon be outpaced by APAC.
Namely, the number of family offices in the region, which currently sits at around 2,290, is expected to grow 40 per cent by 2030 to 3,200 offices, while North America is expected to rise 32 per cent.
“The pace at which the landscape in North America is expanding is slowing down given its relative maturity, while in Asia-Pacific it is heating up given its more recent emergence in family offices,” the report highlighted.
Looking at geographic expansion, Deloitte also pointed to a move towards rising insularity among those in North America and Europe when it comes to establishing secondary branches to their family office.
“Those in Asia-Pacific are, however, bucking this trend and rapidly internationalising,” the firm said.
To illustrate, in 2018, 40 per cent of Asia-Pacific-based family offices set up secondary branches in North America and Europe and has since grown to 61 per cent.
Matt Norman, chief investment officer at London-based Kenjiro Private Office, noted that many wealthy families in APAC are particularly globalised in their investment outlook.
“They have local investments and local issues, and global investments and global issues, just like everyone else. The more family offices you look at and analyse, the more they look the same,” Norman said in the report.
“The challenge for every family office, regardless of where they are located, is the transition from local to global. Wherever the wealth is generated, once families start to grow beyond their local market, they must learn something new, deploy talents with international expertise, and create a plan for growing not only locally, but regionally and globally.”
As such, the globalisation of wealth-holding families often involves undergoing several processes, including the formation of an investment team with international expertise.
“The globalisation process for many families in Asia-Pacific is in its infancy, as a lot of them have just started learning how to put systems in place to enhance family resilience and longevity on an international scale,” Norman said.
