57% of global family office portfolios are now in illiquid assets. Two-thirds of offices with 75%+ private market exposure use leverage to create liquidity or reinvest.
The center of gravity is shifting: sophisticated debt, structured financing, and direct private credit are becoming standard tools, not edge cases. Executives increasingly treat leverage as a risk-managed enabler for staying invested while funding large acquisitions across infrastructure, energy transition, and even sports.
For the industry, this integrates three disciplines—portfolio construction, liability management, and origination. It demands institutional-grade underwriting and covenant discipline, alongside clear governance for cross-collateralization and stress scenarios.
Looking ahead, expect continued growth in private credit engagement (83%), with more family offices targeting double‑digit returns while building lending capabilities in-house or via partnerships. The strategic question is not whether to use leverage, but how to calibrate it against illiquidity, concentration, and multi‑generational objectives.
What frameworks are you using to set leverage ceilings and liquidity buffers for highly illiquid portfolios—and how are you testing them against prolonged private market markdowns?
The center of gravity is shifting: sophisticated debt, structured financing, and direct private credit are becoming standard tools, not edge cases. Executives increasingly treat leverage as a risk-managed enabler for staying invested while funding large acquisitions across infrastructure, energy transition, and even sports.
For the industry, this integrates three disciplines—portfolio construction, liability management, and origination. It demands institutional-grade underwriting and covenant discipline, alongside clear governance for cross-collateralization and stress scenarios.
Looking ahead, expect continued growth in private credit engagement (83%), with more family offices targeting double‑digit returns while building lending capabilities in-house or via partnerships. The strategic question is not whether to use leverage, but how to calibrate it against illiquidity, concentration, and multi‑generational objectives.
What frameworks are you using to set leverage ceilings and liquidity buffers for highly illiquid portfolios—and how are you testing them against prolonged private market markdowns?