Asia-Pacific family offices come of age

The last 20 years have seen unprecedented growth in wealth in Asia-Pacific, fuelled by strong economic expansion, buoyant capital markets and liberalisation. But despite the rise in the number of wealthy, the region’s family office sector hasn’t grown at a similar rate.

That’s according to Campden Research’s inaugural survey on family offices in Asia-Pacific, sponsored by UBS, which found that although more than 60% of family offices in the region were set up in the last 20 years, their numbers – estimated to be just over 100 – don’t reflect the local boom in wealth.

“It is astounding that the family office model hasn’t taken hold in Asia-Pacific to a much greater extent given the dramatic growth in wealth there in the last 20 years,” said David Bain, co-author of the report and head of research at Campden Wealth.

However, this disparity between the number of super-wealthy in Asia-Pacific and the lack of family offices should ensure that growth of the sector will be extremely rapid in the next few years. It also presents Asia-Pacific with the opportunity to come up with new models and ways of organising family offices.

Although family offices in Hong Kong and Singapore are well established, the reports said countries such as China and India are among those most likely to see the family office sector grow quickly. 

“In China, in particular, in the last two years, there has been a high level of interest among wealthy families to understand the western or Hong Kong-based family office concept to create their own models which fit their cultural and regulatory framework,” said Kathryn Shih, chief executive of UBS Wealth Management in Asia-Pacific.

The report, Growing Towards Maturity: Family Offices in Asia-Pacific Come of Age, found that confidentiality is the top priority for family offices in the region, more so than for their counterparts in North America and Europe. 

The 2012 study drew on responses from more than 35 family offices from across Asia-Pacific, which participated through surveys and interviews. Respondents varied from long-established operations servicing at least four generations of the same family to newer establishments, currently developing their services to second-generation family members or non-related families. 

The level of wealth managed by participating offices also varied enormously, from under $100 million (€76.2 million) to well over $1 billion.