How US Family Offices are reshaping their portfolios

Key takeaways

• US family offices have developed one of the strongest "home biases" in the world, with the vast majority of their portfolios allocated to North America, but this is beginning to change.
• Cash allocations are declining as family offices redeploy into developed market equities and private debt, seeking long-term structural growth and enhanced yield.
• Real estate has re-emerged as a significant allocation, with US family offices raising their exposure substantially above the global average.
• For the first time, a growing number of North American family offices intend to place incremental investment in Europe and Asia-Pacific rather than the US, signaling a potential turning point.
• As portfolios go global, the case for a single adviser with genuine cross-border capability has never been stronger. Domestic-only counsel cannot replicate the depth of insight that comes from years of advising families across multiple jurisdictions.

An unprecedented home bias

One of the most striking developments in recent years has been the extent to which US family offices have retrenched from international markets. North American portfolios are overwhelmingly concentrated domestically, and no other region in the world has such a significant home bias. This concentration reflects years of superior US corporate earnings growth, the depth of US capital markets and the structural growth opportunities in areas like generative AI and healthcare.

Investors are now busy trying to figure out what the world will look like next week, next year and next decade. The immediate economic fortunes of domestic investment have made US-based investors twitchy. There are muted signs of an inflationary response to tariffs, and the concept of US-based manufacturing replacing overseas trade will inevitably translate into increased costs for consumers. This concentration risk raises important questions about the adequacy of diversification provisions in investment mandates and whether existing structures provide sufficient flexibility to pivot internationally when the need arises.

Beneath the surface, allocations are shifting

While the overall split between traditional and alternative asset classes has remained broadly stable, there are notable movements underneath. Family offices have been increasing their developed market equity allocations, and private debt allocations have grown significantly, reflecting the appeal of extra yield and diversification. Cash allocations, meanwhile, have continued to decline as family offices redeploy into equities and private debt, investing for long-term structural growth in areas such as generative AI, power and resources, and longevity.

This redeployment has implications for fund formation, subscription agreements and the structuring of co-investment vehicles. Private debt, in particular, requires careful attention to security packages, intercreditor arrangements and the regulatory framework governing non-bank lending, areas where legal counsel plays a critical role in protecting family office interests.

The international pivot begins

Perhaps the most significant change for the future is the emerging trend of North American family offices directing incremental investment towards Europe and Asia-Pacific rather than solely into the US. Dollar depreciation, which has been evident since the start of 2025, is becoming a cause of concern, and US dollar weakness has rekindled interest in European equities and Asian growth markets.

US-based clients remain cautious in the shorter term and, as a result, are looking increasingly overseas for calmer investment waters. Asia is positioned well as an attractive, stable region for investment, being geographically distant from the geopolitical pressures in the Middle East and Europe, with a positive economic outlook. For families making this pivot, the structuring considerations are significant: cross-border tax efficiency, regulatory compliance in multiple jurisdictions and the choice of holding vehicle all require specialist legal guidance.

As US family offices broaden their allocations beyond domestic markets into Europe, Asia-Pacific and beyond, the traditional reliance on a patchwork of purely domestic advisers reveals its limitations, fragmentation, inconsistency and gaps in advice that often emerge too late. What families increasingly need is a single global firm with on-the-ground presence in the markets that matter. One capable of navigating the interplay between US tax obligations, local regulatory requirements and cross-border structuring, drawing on years of experience advising families as they build, protect and transition wealth across borders. The advisers need to have a practical, nuanced perspective, for example, how regulators actually behave, how local market practice diverges from the letter of the law, how structures that appear efficient on paper can create unforeseen complications.

This insight is part 2 of our ‘6 trends shaping Family Offices in 2026’ series, exploring the legal, tax and strategic issues set to influence private clients and family offices in the year ahead. 

Look out for my next post on private equity, venture capital and US Family Offices.