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.
