PE emerges as a winner in large family offices’ plans to add private assets

Global family offices with over $1 billion in assets under management are significantly increasing their allocation to private assets this year, with a strong preference for growth equity and buyout strategies, according to a new survey. This heightened appetite positions private equity as a key beneficiary in their expanded private asset portfolios.

Analysis

A recent survey indicates a significant shift in asset allocation strategies among large global family offices, specifically those with assets under management exceeding $1 billion. These influential investors are demonstrating a heightened appetite for private assets, with a pronounced preference for growth equity and buyout strategies. This trend positions the private equity sector as a primary beneficiary of substantial new capital inflows. The data suggests a strong, optimistic sentiment surrounding the asset class, signaling robust demand from sophisticated capital allocators and reinforcing the ongoing strategic move towards private markets for portfolio growth.

Key Decisions for Investors

• Investors should consider increasing exposure to private equity, particularly funds specializing in growth equity and buyout strategies, to align with the capital flows from large family offices.
• Given the increased capital targeting these strategies, investors should scrutinize the valuation discipline of private equity managers, as heightened competition for deals may inflate entry prices.
• This trend serves as a strong validation for existing private equity allocations and may warrant a portfolio review to ensure managers are well-positioned within the favored growth and buyout segments.