Facts & Figures about Family Offices

Every year multiple reports are issued on single and multi-family offices around the world.

Here is a compilation of the most striking facts and figures about family offices:

There are at least 3,000 single family offices in existence globally and at least half of these were set up in the last 15 years. (Source: EY Family Office Guide)

The number of all family offices in the U.S. has grown to about 3,000, with assets under management between $1 trillion and $1.2 trillion.

The average costs for a single family office are about 0.6% of assets under management.

The #1 surveyed objective of family office was Intergenerational wealth management, followed by accounting, tax and estate planning.

The world’s largest family office by assets under advisement is HSBC Private Wealth Solutions, which oversees $143.5 billion.

The largest Multi-Family Office in the world by number of multi-generational families is Bessemer Trust in New York, which manages assets for over 2,200 families.

Following the Financial Crisis of 2008, the percentage of Family Offices describing themselves as ‘risk averse’ grew from 23% to 46%.

The average family office still has an allocation to ’high risk’ assets (equities, real estate, commodities) of over 70%.

The top family office in assets per family is 1875 Finance of Geneva, which manages the wealth of three multigenerational families, whose assets average $1.7 billion.

U.S. Family Offices manages an average of $400 million in total client financial assets each.

For Asian Family Offices, the #1 motivation for establishing a family office was ‘Family Governance and Succession Planning’, followed by ‘Professionalization’ of the business.

On the other hand, the #1 reason Asian Families were averse to establishing a family office was ‘Lack of Trust’, followed by the feeling of ‘Losing Control’.

For European Family Offices, 43% of the wealth under management came from the total sale of a family business and 28% from the sale of part of a family business.

66% of European Family Offices preferred to manage the finances assets in-house in the family office.

Over the next 30 years, members of the global UHNW population will transfer $16 trillion in assets, which will increase the need for family office services.

The average single family office in the United States employed 8.7 people, versus 13.2 in Europe and 11.8 elsewhere.

In the U.S., a full-service family office will cost a minimum of US$1m annually to run, with 60% of the total costs of a family office allocated to staff compensation and benefits. (Source: EY Family Office Guide)

The #1 philanthropic donations by family offices was to causes for ‘children & youth’, followed by ‘education’.

In 2011, famed investor George Soros, founder of Soros Fund Management, decided to close his hedge fund to outside investors and convert it into a family office.

Globally, family offices allocate 47% of their total budget to investment activities.

The #1 method of recruitment for family offices was via ‘Professional Industry Networks’, followed by the use of a ‘Recruiter or Head Hunter’

Equities are the biggest type of investment for global family offices, who allocate 25% of their investment in them.

Family Office CEO’s earn an average annual base salary of USD 333,000, with additional incentives worth USD 120,000.

Tharawat Magazine, Issue 30, 2016