It’s contrived to say, but 2024 is unfolding rapidly – and reviewing the start of the year, the saying ‘journalism is the first rough draft of history’ comes to mind.

Looking into the major news headlines of the first quarter of the year, the family office market has lost none of its pace. Monitoring services have picked up on 130 significant articles from major news platforms on the topic of family offices, and the changes that affect them.

Diving into this realm, it’s interesting to see which themes have taken the limelight, which are recurring, and which have only just made their first breakthrough – and an examination of each headline reveals new insights into how we might expect family offices to adapt and thrive over the course of the year.

Hong Kong and Singapore Lead A Family Office Renaissance

Across the 130 provided headlines, Hong Kong and Singapore dominated stories both Asian, European, and US-based newsrooms.

That’s perhaps unsurprising with the news that a recent market study estimated that there are around 2,700 single-family offices based in Hong Kong. Some of the difficulty in quantifying that number lends itself to the debate as to what is actually considered a family office – an alternative number posits that just 400 single family offices exist in Hong Kong instead.

Nevertheless, both Hong Kong and Singapore have tussled to attract family offices to take up residency in their respective jurisdictions. While Singapore has 1100 family offices that are officially registered with MAS, Hong Kong’s government has launched initiatives such as Impact Link (a charitable initiative) in its bid to become a global family office hub.

The regional rivalry doesn’t end in the east, Dubai and the UAE are also making a strong “new-world” play at attracting new family offices. We’ll likely continue to see further competitiveness in the market, as family offices seek new and enticing jurisdictions to root themselves in.

Financial Institutions Revealed Bespoke Wealth Management Operations

To reference the debate over what actually constitutes a family office, we’ve seen financial institutions make several moves to cater their services for this segment and more appropriately assign hires and human resources to servicing the UHNWI market best.

An article from Global Finance perhaps sums it best – “a $72 trillion global avalanche of inheritance is coming. Are private banks and wealth managers up to meeting the next generation’s needs?”

JP Morgan fired a first salvo in 2023 by adding UNHW and family office services to its roster – and this year, we’ve noted stories such as Citi Private Bank hiring UBS’ Richard Weintraub to lead its own family office group, while corporate venture studios such as xcube have even launched its own Corporate Venture Portfolio Equities, aimed at family offices and UHNWIs.

The race is on – and the time is now for more financial institutions to prepare for the shifts ahead.

Family Offices Are Drawn To Private Credit

A consistent theme in this quarter has been the allure of private credit – with one study by Hedgeweek noting that six in 10 family offices are looking to increase their exposure to private credit in 2024.

A number of other reports have similarly noted this finding – including Campden Wealth’s 2023 European Family Office Report citing that family offices were planning to increase their alternatives allocation over the following 12 months.

The finding isn’t just local to Europe, however – Asian Investor noted that family offices are driving a new private credit boom, while KKR’s family office survey of 75 chief investment officers noted that 52% of their portfolios invested in alternative investments – including private credit.

New Regulation And Compliance

While Singapore and Hong Kong may have stolen the limelight, we’ve similarly noticed other international jurisdictions compete to draw family offices to take up residency.

For example, Malaysia’s government is actively developing new regulatory frameworks to attracting family offices, while Bermuda’s Minister of Economy and Labour recently introduced Bermuda’s new framework of solutions for family offices.

A broader pattern emerges looking at the interest of private banks, financial institutions, and even jurisdictions changing pattern to accommodate wealth transfer from regions such as the Middle East – with governments and regulators seeking to unveil bespoke legislation to entice family offices.

An Outlook For The Rest Of 2024

Looking over recent headlines, I’m reminded of an outtake from Simple’s 2024 Outlook for Family Offices – that new shifts will place “a greater emphasis on [Family Offices] proactively managing portfolios to ensure they’re diversified enough to offset long-term uncertainties.”

Across themes from Asia’s early dominance in attracting new family offices, revised legislation to attract the residency of UHNWIs, to new financial service offerings, and the allure of alternative investments, it feels as if the broader market sector is drawing breath in anticipation of greater change to come.

What will the rest of 2024 bring? Only time – and news headlines – will tell.

Sources: Forbes