The total wealth for family offices is expected to grow by 73 percent to reach $9.5 trillion by 2030, according to a new report by Deloitte.
According to the report, this accounts for an 189 percent rise between 2019 and 2030.
Their wealth in 2024 is $5.5 trillion, up 67 percent within five years, the consultancy firm revealed. It is set to grow by another 26 percent by 2025 to hit $6.9 trillion.
The report also highlights a significant increase in the number of single family offices worldwide. There are currently an estimated 8,030 single family offices globally, marking a 31 percent increase from 6,130 in 2019. This number is projected to grow further, reaching 9,030 by 2025 and 10,720 by 2030, representing a 75 percent increase over the decade.
Family office statistics
Geographically, North America leads with 3,180 single family offices, followed by Asia Pacific with 2,290, and Europe with 2,020. The Middle East, South America, and Africa host 290, 190, and 60 single family offices respectively.
Deloitte expects that North America will experience the most substantial growth in family wealth and family office assets under management (AUM), with a projected average increase of 258 percent between 2019 and 2030. Asia Pacific follows closely with an expected growth of 208 percent during the same period.
“Looking at the future of the family office space, I expect that the number of wealth holders and service providers will grow and thereby bring additional opportunities for growth among family offices. But there will be concerns over whether the space can ever standardise itself,” Matt Norman, chief investment officer, Kenjiro Private Office, single family office based in the United Kingdom and Japan, was quoted as saying in the report.
Interestingly, the report reveals that 28 percent of family offices now operate multiple branches. While North American and European family offices tend to establish secondary branches within their own regions, 61 percent of Asia Pacific family offices have expanded internationally, primarily to North America (38 percent) and Europe (23 percent).
The surge in new wealth over recent decades has reshaped the landscape of family offices. The report indicates that 90 percent of family offices serve first (41 percent), second (30 percent), or third (19 percent) generation families. This trend reflects the recent proliferation of family offices worldwide, with 68 percent of all offices being established after the year 2000.
“The family office has evolved. The asset base has grown, and the family’s focus has expanded, along with their personal needs. When I joined more than 10 years ago, we did not have a meaningful investment team in-house, and now we have a full-fledged investment team running our portfolio,” said a CFO of a US-based single family office, as quoted in the report.
However, Deloitte also raised concerns about long-term wealth retention. Only one in ten family offices now represents legacy families (fourth generation or older), hinting at the challenges families face in maintaining their wealth across multiple generations.
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