Fresh data has reinforced earlier findings by the Australian Investment Council (AIC) and Preqin, which identified family offices as the dominant investors in private capital.
According to the pair’s 2025 Australian Private Capital Yearbook, family offices accounted for 40 per cent of active private capital investors in 2024, up from 25 per cent in 2022 and just 10 per cent in 2020. Over the same period, the share held by superannuation funds fell from 48 per cent in 2020 to just 13 per cent as of December 2024.
UBS’ Global Family Office Report 2025, released Friday, paints a similar picture – one of rising allocations to private markets, particularly private credit.
Globally, average investment in private credit doubled to 4 per cent in 2024, with the APAC region standing at 5 per cent, second only to South-East Asia at 6 per cent. Among family offices adjusting portfolios in 2025, the average allocation to private credit is expected to rise further to 5 per cent.
“We have noticed the embrace of endowment-style portfolios. Such portfolios have a significant allocation to private assets such as private equity, private credit and unlisted infrastructure,” said Andrew McAuley, chief of investments, UBS Global Wealth Management Australia.
“Although traditionally illiquid, many providers are now able to offer open-ended vehicles for access to private assets, which has opened to the asset class to smaller family offices and those that have a higher liquidity requirement.”
Interestingly, this growing interest in private markets has coincided with increased professionalism in the local market, with McAuley noting a level of sophistication comparable to that of the superannuation industry.
“There is now a large, well-credentialled community of investment professionals applying world’s best practice,” he said.
Globally, UBS said while family offices still favour developed markets, many expect to further lift allocations to private assets. More than a third (37 per cent) anticipate a significant or moderate rise in direct private equity or fund investments, while 30 per cent expect a similar increase in private debt exposure.
Moreover, the report found family offices are increasingly focused on structural growth, yield enhancement and diversification. Many are reducing cash holdings in favour of developed market equities, while also seeking access to long-term structural growth in areas like generative artificial intelligence (AI) and healthcare.
"Of late, there has been commentary around the US being a less desirable investment destination due to policy uncertainty, but we have not observed this, despite our mildly negative view on the USD,” McAuley said.
“In fact, we have seen some clients more enthusiastically seek opportunities in the US. In particular, investment has flowed to long-term themes such as AI, electrification and healthcare.”
As for risks on the horizon, McAuley said concerns are broadly aligned across global investors, with tariff policy uncertainty, growing government debt particularly in the US, inflation and geopolitical conflict top of mind for clients.
“Fortunately, Australia is in relatively good shape,” he said.
“The impact of US tariff policy as it stands is manageable, the Australian government spends less of its revenue on servicing debt than similar countries like the US, UK, Canada and New Zealand and inflation is trending down.”
