Friday, June 22, 2018
Martin Hennecke

Family wealth grows
The investment portfolio of family offices across the world grew by as much as 7 percent last year, from a meager 0.3 percent growth in 2015, thanks to gains in equities and private equity, according to research by UBS and Campden Wealth Research.

A family office refers to the private office of a family of significant wealth setting with different purposes including handling key family assets.

The report showed that North America family offices produced the most robust growth of 7.7 percent, while Asia Pacific, including Hong Kong, family offices grew by 6.7 percent and 5.9 percent, respectively,

Family offices in Hong Kong had a higher allocation in real estate investments compared to its peers in the region.

On average, Asia Pacific family offices manage US$445 million (HK$3.47 billion) worth of assets, with a slightly higher proportion in private equity, which accounts for 20.9 percent collectively. Hong Kong and Singapore family offices had a lower private equity allocation at 13.7 percent and 19.3 percent, respectively.

UBS and Campden Wealth Research surveyed principals and executives in 262 family offices, with an average US$921 million worth of assets under management.

Enrico Mattoli, head of global family office for Greater China at UBS Wealth Management, said real estate is not a high-risk investment, but a stable choice to invest in as it generates high returns on capital.

He also said family offices in China are characterized by younger entrepreneurs or so-called "new wealth," who are more likely to be oriented toward growth than assets preservation.

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