Family office insights
Our latest Global Family Office Report which is based on an extensive survey of 230 clients globally has shown that family offices anticipate increasing real estate investments over the next five years.
We talked to UBS experts Nicki-Marco Weber, Head Europe Investment Sales Specialists and Thomas Veraguth, Chief Investment Office Real Estate Specialist, about how family offices invest in this asset class.
What have been your main observations from the Global Family Office Report in terms of how family offices invest in real estate?
Weber: After planning to trim their allocations to real estate in 2023, family offices plan to increase them again in the next five years. This is in line with the current real estate cycle. Once real estate prices bottomed out, real estate could provide an interesting point to increase the real estate allocation.
This sentiment is also reflected by feedback from a Danish CIO who said: “In terms of real estate, we plan to invest more but it’s hard to conclude anything at the moment because the business cases that we see do not yet reflect the shift in interest rates. However, I think the situation will settle in the next year or two.”
We see that there are significant regional differences between real estate investment preferences by family offices. What stands out for you most and what are the underlying reasons
Veraguth: It’s mainly European including Swiss, Latin American and US family offices that foresee bigger allocations in real estate. One reason may be that these are the regions where nominal interest rates are relatively high and have furthest to fall, which supports capital returns. By contrast, fewer Asia-Pacific investors see themselves increasing allocations as real estate yields are typically low in gateway Asian cities.
Global Family Office Report 2023
Global Family Office Report 2023
Our annual Global Family Office Report is the most comprehensive study of single family offices worldwide.