Blog

Family Offices in Private Equity – August 2015

by Katie Edwards

  • 07 Aug 2015
  • PE

Preqin’s Investor Intelligence currently tracks 5,885 active investors in the private equity asset class, and despite being a relatively small investor in terms of size, family offices account for 8.7% of the investors Preqin tracks, a proportion that continues to increase, rising by 31% compared with this time last year. Just over half (51%) of the family offices tracked are single-family offices, which leaves the remaining 49% to be multi-family offices, showing an even proportion of each family office type.

Fifty-two percent of the family offices tracked by Preqin are based in North America, with 31% located in Europe and a further 14% in Asia.  Fifty-three percent of family offices have previously invested in or are looking to invest in North America in the future; forty-six percent named Europe as an investment preference, and 34% have previously invested or are looking to invest globally. 

Venture capital vehicles are currently the most preferred fund type of family offices, with 48% having previously invested, or looking to invest, in this fund type in the future. Buyout vehicles are now the second most desired fund type (38%), having been the most attractive in August 2014. Thirty percent of family offices stated growth funds to be a preference, followed by distressed debt vehicles (16%). 

The average target allocation to private equity for family offices is notably higher than the average target allocation for all LP types. Family offices have an average target allocation to private equity of 27% of total assets, while the average target allocation for all LPs is 19%. The current allocation for family offices and all LPs follow a similar pattern, with family offices’ current allocation standing at 23% of total assets and 17% for the LP universe as a whole. 

Medley Partners is an example of a single-family office that is looking to make new private equity fund commitments over the coming year. The $1.2bn family office will look to commit $234mn to new private equity funds, working with a mix of new and existing managers in its portfolio. The multi-family office Esko Asset Management is also looking to make three new private equity fund commitments over the coming year, committing at least $15mn in total.

Continue browsing industry reports, publications, conferences, blogs and more on Preqin Insights