Almost eight in 10 family offices have opened at least one overseas branch in the last five years, new research shows.
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Of the 300 family office professionals surveyed, more than a third (36 per cent) said they have three physical offices. Just over a quarter (27 per cent) have more than five.
The research into the behaviour of FO leadership was conducted by Ocorian.
Some 78 per cent of respondents, who oversee a combined $155 billion in assets under management, explained the main reason for expanding into different jurisdictions is to accommodate family members moving abroad.
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This trend is set to continue with almost nine in 10 family office professionals confirming they had seen a rise in family members acquiring multiple citizenships or residing in multiple countries. Of these, 86 per cent expect this trend to continue over the next five years.
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Other leading reasons for this global push include needing a greater physical presence to support an increasingly complex and diverse portfolio (57 per cent) and to hedge against rising geopolitical risk (41 per cent).
Around 40 per cent cited tax and regulatory issues, while just over one in 10 (11 per cent) said they had branched out in the hope of finding qualified employees to fulfil a skills shortage in their original location.
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Michael Harman, commercial director, private client at Ocorian commented: ‘There has been a significant increase in the numbers of physical offices opened by high-net-worth families in the last five years, and our research shows that this has been driven primarily by a market trend which sees clients setting up their own family offices, wherever they happen to be, rather than using an existing family office.
‘People want to live internationally and also have their investment interests internationally based – there are evident upsides to diversifying in this way, not least in respect of managing risk.’
Looking to the future, Harman said Hong Kong, Singapore and the Cayman Islands will emerge as growth centres, although the UK will remain ‘highly relevant’.
He added: ‘There is a lot to consider when deciding where to set up, but having access to the right professional services and infrastructure is essential.’
