The top 250 Family Offices in Australia account for approximately $181 billion as at May 2010, with the largest 20 accounting for $67.7 billion. The range within that top 250 is from $7.17 billion to $200 million. There are a significant number of smaller Families in the $30 million to $200 million range that do not have the economies of scale to establish standalone Family Offices, rather they either use multi-family offices such as the Myer Family, with about 50 families apart from the Myer Family, or other service providers to provide the outsourced services. This sector is a significant user of private banking, accounting, taxation and investment management services.

An Australian family office is generally a private company that manages investments and trusts for a wealthy family and their extended members. Most family offices are relatively new in Australia, and have often only been created by the first generation in the last 10 to 20 years. There are some older families such as the Fairfax, Albert and Myer families where fifth, sixth and seventh generations are beneficiaries of the family office structure.

The traditional family office will provide a range of services from personal services (managing household staff) to property management, philanthropy coordination, legal and tax services, and financial and investment services. A family office will typically have an investment team that manages the assets for a number of beneficiaries. This service may be provided within the office or through private banking or advisory services of a financial institution. The multi-family office model is still early in Australia however there seems to be a great deal of opportunity as a number of the “new” wealth groups look to the experience of other families. On this theme, a number of families are co-investing and sharing due diligence on transactions.

While family offices have been popular in the USA and Europe for some time, this niche are has only recently taken off in Australia, as Australian investors become more sophisticated in their demands and the financial advice market has become more competitive. The Family Offices within the Top 100 are cashed-up with over $13.6 billion. This is a conservative estimate and may well exceed A$20 billion. The typical office has a Chief Investment Officer and investment managers/ analysts. This team will report to a board consisting of the principal representatives, independents and executives. Corporate Governance has been a focus of many of the larger families and the requirement to have some independent advisory board members.

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