Family offices ramp up infrastructure allocations

Family offices in Europe are shifting capital toward infrastructure and other defensive assets, according to a July survey by Roland Berger of 88 family office executives mostly based in Germany, Switzerland and Austria.

The survey found 69% of respondents plan to increase their exposure to infrastructure, up from 41% a year earlier. Geopolitical shocks are the top concern for family offices, cited by 88% of respondents, compared with 65% a year earlier. Concern about interest rates fell to 68% from 78%.

Private equity remains the largest single target of allocations. Among family offices already invested in private equity funds, 55% expect to increase fund positions, up from 48% in the prior survey. For direct private equity holdings, 50% plan to add exposure, compared with 57% previously.

Venture capital allocations are being reduced. Only 19% of family offices plan to raise venture exposure while 35% intend to cut it. The survey links the reductions to greater risk aversion toward early-stage investments.

Healthcare remains a defensive holding, with 58% of family offices calling the sector relevant to their investment focus, down slightly from 61% a year earlier. Interest in artificial intelligence rose to 45% from 37%. Finance and fintech relevance rose to 19% from 8%. Industrial and cyclical areas were cited by 27% versus 24% previously.

Geographic preferences favor developed markets. North America was cited as relevant by 88% of respondents. Northern Europe was relevant to 87% and 60% of family offices plan to increase exposure there. Japan was considered relevant by 72% and 44% plan to raise allocations, with respondents citing improving corporate governance and structural conditions.

Thirty percent of family offices plan to reduce exposure to the Middle East. The Middle East, South America and Africa are classified as non-core markets by many respondents.

Liquidity management remains a priority: 94% of family offices maintain a cash allocation, up from 92%. The survey shows family offices maintaining cash buffers while increasing positions in selected sectors such as infrastructure and private equity.