According to WealthManagement, institutional family offices are becoming pivotal players in public and private markets, marked by their increasing size, sophistication, and influence. Their global needs and complex investment strategies shape major investment trends, often making them early adopters of new opportunities. At their fifth annual Apex Family Office Symposium, Goldman Sachs gathered 170 family office investors from 15 countries to discuss key economic and investment themes.
WealthManagement reports that the following dynamics were highlighted:
Rising Interest in Alternative Investments
A 2023 survey showed that these offices allocate 44 percent of their portfolios to alternatives, with private equity and private credit outperforming global public markets over long-term horizons. At the recent symposium, 60 percent of attendees indicated plans to increase exposure to private equity, 53 percent to public equities, and 41 percent to private credit.
Artificial Intelligence: A Major Focus
Artificial intelligence (AI) was a central topic at the symposium. The focus is shifting from the so-called "Magnificent 7" to secondary beneficiaries, such as data centers, energy infrastructure, and electric component producers—sectors crucial to the sustained adoption of AI technologies.
Private Real Estate Investment
Private real estate remains a key interest for family offices, many of which have extensive experience and generational wealth in the asset class. Current market conditions, including higher capital costs and shifts in the lender base, present intriguing investment opportunities. Discussions at the symposium also touched on the impending debt maturity wall and the impact of digitalization on real estate markets.
Investing in the Sports Ecosystem
Family offices are increasingly drawn to the sports ecosystem, attracted by its uncorrelated nature to financial markets and the passion it elicits. Sports team valuations continue to rise, driven by increasing media contract values and sponsorships, enhanced by the growth of live streaming and the global sports betting industry.
Energy Transition Investments
The transition to sustainable energy is another significant theme. Family offices are investing across the energy sector, from green hydrogen and next-generation nuclear power to batteries and electric vehicles.
Family offices are at the forefront of identifying and investing in emerging megatrends.
Financial Advisor Transitions consults advisors nationwide to explore employment transition options and to preserve and protect their practice in any transition that they make.
