The complex task of assessing single family office numbers
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With Intelligence and Highworth Research created a report showing the number of SFOs and MFOs by country and major region. Explore the key trends and what they mean for the future of family offices in our comprehensive special report.
Last month, the Swiss Single Family Office Association, in collaboration with UBS and the University of St Gallen, produced what is claimed to be the first survey of Swiss single-family offices (SFOs). The Association estimates that there are between 250 and 300 SFOs in Switzerland. Their assessment is refreshingly realistic and conservative, based on local market knowledge, undistorted by a need to boast about the country's attractiveness to family offices.
The Swiss Family Office Association's assessment stands out for two principal reasons. Firstly, competition between certain countries to attract family offices has led to spurious national claims of high numbers. Secondly, few estimates of the number of SFOs globally seem to be based on anything more than guesswork.
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Hong Kong and Singapore are two examples of places where recent estimates of single-family office numbers distort a realistic assessment. Over the past couple of years, both have been in a race to attract SFOs and claim first prize in Asia.
According to a March 2024 study by Deloitte on the "Family Office Landscape in Hong Kong," there are 2,703 single-family offices in Hong Kong. This assessment depends on a "commonly accepted statistical methodology based on a global and proprietary database of 200,000 ultra-high net worth individuals and families." However, Deloitte concedes that the correlation "between wealth and the establishment of single-family offices" may be "susceptible to a margin of error."
The analysis reports that of the claimed 2,700 SFOs in Hong Kong, 535 or 20%, are drawn from the "wealth tier" of US$10m - US$30m. Most observers agree that a family office cannot be established with a level of wealth less than $30m, but this still leaves 2,168 SFOs statistically calculated by Deloitte to exist in Hong Kong with wealth levels above US$30m. Of these, 885 are deemed to be from the wealth tier of US$100m and above.
These numbers conveniently feed the narrative that the tax-favorable regime for family offices introduced by the HK Government "will take Hong Kong to the next level as the world's pre-eminent center for family offices." The USA, Switzerland, or Singapore may disagree. The Deloitte report was commissioned by FamilyOfficeHK, a Hong Kong government body aiming to attract family offices to Hong Kong.
At this point, it's worth remembering that in 2016, EY estimated that the global population of single-family offices was 10,000. By this measure, Deloitte is reporting that 27% of the world's single-family offices are in Hong Kong. KPMG's global family office population assessment is more aggressive; it estimates 20,000 globally. The significant disparity between the two figures from well-known multinational firms illustrates the difficulty of the SFO market sizing task.
In Singapore, the city-state's Economic Development Board reports that 1,400 single-family offices have been established in the country, lured by favorable tax incentives promoted by the Monetary Authority. Initially, no minimum AuM was stipulated for SFOs, but as of July 2023, the MAS raised the qualifying AuM level for SFOs to S$20m (US$15m), and according to HSBC, it has now increased again to US$30m. Authorities are rigorously scrutinizing family offices' credentials since a record-breaking S$3bn money laundering case connected to several so-called family offices. Lowering entry standards naturally raises risks.
Assessing the number of family offices nationally or globally is challenging. It's tempting to take shortcuts by assuming a certain percentage of the UNHW community is statistically likely to have a family office.
A professionally researched, extensive database of single-family offices, carefully screened for their valid credentials, can help assess market size. The Family Offices Database from Highworth Research, part of With Intelligence, is the largest online database of SFOs available. It holds detailed profiles of over 2,700 SFOs in 74 countries, including contacts. This number grows weekly as Highworth adds further profiles of family offices to its online platform.
Highworth's knowledge of multiple data sources allows the firm to confidently identify approximately 2,500 more single-family offices over the next several years. Additionally, Highworth believes there may be around 2,000 further SFOs globally that are off the radar and unlikely to be publicly discovered. If their credentials as SFOs are genuine, they remain valuable clients for asset managers, banks, and professional advisors.