Investment grade credit is likely to see the biggest rise in family office investment allocations in 2024 with more than half (52%) planning to increase allocations dramatically. However all alternative asset classes and global equities are likely to see more investments from family offices. These are some of the major results of a survey commissioned to independent research company PureProfile by Ocorian, a global leader in corporate and fiduciary services, fund administration and capital markets (see here the press release).
Almost all (94%) of family office professionals questioned say they expect to increase the number of acquisitions and investments their family office makes this year compared to 2023. Around 18% expect to dramatically increase acquisitions and investments while 6% expect to deliver the same level of acquisitions and investments.
However, part of the rise in acquisitions is down to a strategic shift: nearly half (49%) questioned say they want to increase levels of direct investing while 21% say they are cash rich and 9% admit they need to diversify. As for alternative investments, 60% of respondents say the want slightly increase their allocation to private debt, 48% to private equity and 42% to real estate funds.
Amy Collins, Head of Family Office at Ocorian, said: “The family office sector is growing rapidly and going through a series of tactical and more structural changes, as the study shows, with family offices set to go on a buying spree in the year ahead. With interest rates having been so low for so long, the increases have created a new way to look at certain asset classes. Where the principals served by family offices, whether they be younger or simply of a different generational mindset, are more focused on exploring private equity and direct investment opportunities, we are seeing more of that as a trend, this is a trend we identified in our research at the start of 2023 where almost all agree of the family office professionals questioned said that the sector is increasingly investing in alternatives and the switch is a long-term trend. Around 42% strongly agree with the view”.
