Key Takeaways
- • Family offices plan to increase allocations to all major alternative asset classes over the next two years, with no fund managers reporting plans to reduce exposure, according to Ocorian's global study of firms managing $68.26 billion in total wealth.
- • Infrastructure is positioned for the largest allocation increases, with 64% of family office investment managers expecting to boost allocations by 25–50% over the next two years, followed by private debt (32%), real estate (22%), and private equity (21%).
- • Alternative assets now represent 42% of family office portfolios on average, reflecting a significant shift toward diversification as the primary driver for increased alternative exposure, ahead of transparency and income-generation benefits.
- • Private markets participation among family offices has surged dramatically, with allocations rising from 651 family offices in 2016 to 4,067 by recent data—a 524% increase—while Asia leads regional adoption at 74% exposure to alternatives.
- • Single-family offices demonstrate strong conviction in alternatives, with 90% maintaining or increasing private equity exposure, indicating sustained institutional appetite despite generational shifts in portfolio strategy.
Summary
Family offices are significantly expanding their exposure to alternative investments, driven primarily by diversification objectives rather than performance chasing. An Ocorian study of family office fund managers overseeing $68.26 billion in aggregate wealth reveals that 100% of respondents plan to increase allocations to major alternative asset classes, with none reporting intentions to reduce exposure over the next two years. This represents a fundamental strategic shift in how ultra-high-net-worth families structure their investment portfolios.
Infrastructure investments are emerging as the primary beneficiary of this reallocation trend. Nearly two-thirds of family office investment managers (64%) expect to increase infrastructure allocations by 25–50% over the next two years. This preference reflects infrastructure's dual appeal: diversification benefits combined with reliable income generation—a critical consideration in the current macro environment. Private debt follows as the second-priority alternative, with one-third of managers planning similar 25–50% increases. Real estate and private equity allocations are also slated for expansion, though at more modest rates of 22% and 21% respectively among managers planning increases in that range.
The rationale underlying this shift is instructive for understanding family office investment philosophy. Diversification benefits ranked as the primary motivation for increased alternative exposure, followed by enhanced transparency in alternative asset classes and the income-generation capabilities of certain alternatives such as infrastructure. Recent strong performance ranked fourth in importance, suggesting that family offices are pursuing alternatives for structural portfolio benefits rather than chasing returns. This distinction matters for institutional investors seeking to understand whether alternative capital flows are cyclical or structural.
Broader trends underscore sustained momentum toward alternatives. BlackRock's 2025 Global Family Office research documents that alternatives now comprise 42% of average family office portfolios, down marginally from 44% in 2023 but reflecting a stable strategic positioning. More dramatically, Preqin data shows that family offices with private markets allocations have surged from 651 in 2016 to 4,067 in recent periods—a 524% increase. Geographically, Asia leads adoption, with 74% of family offices reporting alternative exposure. Single-family offices demonstrate particular conviction, with 90% maintaining or increasing private equity allocations, indicating that next-generation wealth managers maintain strong appetite for alternatives despite broader portfolio adjustments.
Infrastructure investments are emerging as the primary beneficiary of this reallocation trend. Nearly two-thirds of family office investment managers (64%) expect to increase infrastructure allocations by 25–50% over the next two years. This preference reflects infrastructure's dual appeal: diversification benefits combined with reliable income generation—a critical consideration in the current macro environment. Private debt follows as the second-priority alternative, with one-third of managers planning similar 25–50% increases. Real estate and private equity allocations are also slated for expansion, though at more modest rates of 22% and 21% respectively among managers planning increases in that range.
The rationale underlying this shift is instructive for understanding family office investment philosophy. Diversification benefits ranked as the primary motivation for increased alternative exposure, followed by enhanced transparency in alternative asset classes and the income-generation capabilities of certain alternatives such as infrastructure. Recent strong performance ranked fourth in importance, suggesting that family offices are pursuing alternatives for structural portfolio benefits rather than chasing returns. This distinction matters for institutional investors seeking to understand whether alternative capital flows are cyclical or structural.
Broader trends underscore sustained momentum toward alternatives. BlackRock's 2025 Global Family Office research documents that alternatives now comprise 42% of average family office portfolios, down marginally from 44% in 2023 but reflecting a stable strategic positioning. More dramatically, Preqin data shows that family offices with private markets allocations have surged from 651 in 2016 to 4,067 in recent periods—a 524% increase. Geographically, Asia leads adoption, with 74% of family offices reporting alternative exposure. Single-family offices demonstrate particular conviction, with 90% maintaining or increasing private equity allocations, indicating that next-generation wealth managers maintain strong appetite for alternatives despite broader portfolio adjustments.
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