The Private Market Surge: What Family Offices Are Really Doing—and What Investors Should Learn
Family offices have quietly transformed the investment landscape over the past decade, and their growing appetite for private markets is reshaping how wealth is managed at the highest levels. According to Preqin data, the number of family offices with allocations to private markets has exploded by an eye-popping 524% since 2016, soaring from 651 to over 4,000 today. This growth outpaces that of traditional wealth management firms and even large endowments, signaling a seismic shift in capital deployment strategies among the ultra-wealthy.
Why the rush into private assets? The answer lies in the unique characteristics and goals of family offices. Unlike public market investors who often face pressure for liquidity and short-term performance, family offices typically manage multi-generational wealth with a longer time horizon. This allows them to embrace illiquid investments such as direct lending, private credit, infrastructure, and data centers—areas known for generating stable, inflation-resistant cash flows over time. Deloitte estimates that family offices collectively manage $3.1 trillion in assets as of 2024, up 63% from just five years ago, providing the firepower to pursue these opportunities aggressively.
BlackRock’s institutional head for the Americas, Armando Senra, highlights that this trend is not just about chasing yield but also about diversification and stability amid public market volatility. A recent BlackRock survey found nearly one-third of single-family offices plan to increase their allocations to private credit and infrastructure through 2026. This aligns with PwC’s Jonathan Flack’s observation that family offices prioritize long-term growth in a more stable environment, contrasting with the often turbulent public markets.
However, family offices are not blindly piling into private assets. UBS’s May survey reveals a nuanced approach: while private debt holdings are expected to rise, private equity allocations may be trimmed in favor of developed market equities, especially among U.S.-based family offices. This selective recalibration reflects a sophisticated understanding of risk and opportunity, signaling that family offices are actively managing their exposure rather than following a one-size-fits-all trend.
What does this mean for investors and advisors outside the family office sphere? First, the private market boom underscores the importance of long-term, illiquid investments in a diversified portfolio—particularly in a world of rising interest rates and inflationary pressures. However, as family offices demonstrate, success in private markets requires selectivity, deep due diligence, and a willingness to adapt allocations based on evolving market conditions.
For financial advisors, the lesson is clear: educate clients about the strategic role private assets can play, but emphasize the need for patience and rigorous selection. Advisors should also prepare for increased demand for private credit and infrastructure exposure, sectors that offer income and resilience in uncertain markets.
Looking ahead, expect family offices to continue pushing innovation in private markets. For example, emerging themes like climate-focused infrastructure and technology-enabled real assets are gaining traction. Advisors and investors who anticipate these shifts and integrate them thoughtfully into portfolios will be best positioned to capture long-term growth.
A recent report from McKinsey supports this outlook, noting that private markets could account for nearly 50% of global assets under management by 2030—driven largely by family offices and institutional investors seeking differentiated returns.
In summary, the family office surge into private markets isn’t just a passing trend; it’s a strategic evolution reflecting deeper shifts in wealth management philosophy. Investors and advisors who recognize the long-term benefits, embrace disciplined selection, and stay ahead of emerging themes will find themselves aligned with some of the savviest capital allocators in the world.
Actionable Takeaways:
– Consider increasing exposure to private credit and infrastructure, but maintain a balanced approach with public equities.
– Prioritize due diligence and selectivity in private market investments to manage illiquidity and risk.
– Monitor emerging sectors like climate infrastructure and tech-enabled real assets for future growth opportunities.
– Educate clients on the importance of a long-term mindset to navigate private markets effectively.
Sources:
– Preqin Alternative Assets Data
– BlackRock Institutional Investor Surveys
– Deloitte Family Office Wealth Report 2024
– UBS Family Office Private Market Survey 2025
– McKinsey Global Private Markets Report 2024
Stay tuned for more insights as we continue to decode the strategies shaping the future of wealth.
Source: Family offices turn to private markets, allocations up 500% since 2016