Multifamily Offices Show Solid Asset and Revenue Gains in 2012

Multi-tiered service offerings, key hiring and social media helped fuel the return to growth at multifamily offices, according to findings of the 9^th Annual MFO Study from The Family Wealth Alliance. Multifamily offices saw a 9.6% gain in assets under advisement and an 11.3% increase in revenues according to the study, which was conducted in late 2012.

“Multifamily offices have worked hard to overcome barriers to growth faced by the industry. They’ve hired business development officers, revisited pricing strategies, and added new service offerings aimed at less wealthy families than their traditional clients,” said Bob Casey, head of research for The Family Wealth Alliance. “The No. 1 business challenge cited by participants is the lack of marketplace differentiation for MFOs, their service model and the benefits they can offer to client families,” he added.

Among the 9^th Annual MFO Study findings:

• Smaller firms, under $500 million in assets, grew by an average 13.2%
• Largest firms, with assets of more than $5 billion, grew by 10.4%
• Mean MFO client relationship size is $40.9 million (as of 12/31/2011)
• Firm assets under advisement $7.4 billion, on average
• More MFOs are serving single-family offices, 69.6%, up from 57.5% in 2011 and 52.1% in 2009

Use of dedicated business development officers among study participants jumped by 22.9% in 2011, and is a common practice among larger MFOs but the exception among mid-size or smaller MFOs. More than one-third of participants have adopted a two-tier pricing and service model, offering a full MFO service menu at higher fees at asset minimums of $20 million to $30 million, and a more limited-service menu focusing on investments, with lower asset minimums and fees.

All 51 firms participating in the 9^th Annual MFO Study are listed in the report. For a full list, please click here.

Alliance Research is supported by its partner firms. These organizations are: Babson Capital Management LLC, Efficient Capital Management, Inc., OppenheimerFunds, Inc., Pershing Advisor Solutions, State Street Global Advisors, State Street Wealth Manager Services, Summitas and World Gold Council.

Alliance Research will conduct in 2013 its 10^th Annual MFO Study, the 3^rd Annual 2013 External CIO Study, the 2^nd Annual Security Study, which looks at acute, unforeseen and chronic security threats to private families and an Inaugural Alliance Reporting Study, which examines the current state of consolidated reporting for private families. For more, please go to.

All 51 firms participating in the 9^th Annual MFO Study are:

• Abbot Downing, a Wells Fargo Business
• Acacia Wealth Advisors, LLC
• Arlington Family Offices
• Ascent Private Capital Management of U.S. Bank
• Aspiriant
• Athena Capital Advisors LLC
• Atlantic Trust
• Ballentine Partners, LLC
• BBR Partners
• Bessemer Trust
• BNR Partners
• Delegate Advisors, LLC
• Envoi, LLC
• Federal Street Advisors
• Filament LLC
• Financial Controllers, Inc
• GenSpring Family Offices
• Glenmede
• Greenway Family Office
• Halbert Hargrove
• Harris myCFO
• Hawthorn, PNC Family Wealth
• Hillview Capital Advisors, LLC
• Legacy Trust Family Wealth Office
• Lowenhaupt Global Advisors, LLC
• Manchester Capital Management LLC
• Matter Family Office
• Meristem, LLP
• Mirador Family Wealth Advisors
• Ohana Advisors LLC
• Optivest, Inc.
• Pathstone Family Office, LLC
• Pepper International, LLC
• Pitcairn
• Plante Moran Financial Advisors
• Rockefeller & Co.
• Rothstein Kass Family Office Group
• Savant Capital Management
• Signature
• Silver Bridge Advisors, LLC
• Silvercrest Asset Management LLC
• Threshold Group LLC
• Tolleson Wealth Management
• Truepoint Inc.
• U.S. Trust Family Office
• Vogel Consulting
• Waldron Wealth Management
• Waypoint Advisors
• Whittier Trust Company
• WMS Partners
• Yolles, Toal & Post – Diversified Portfolios, Inc.

 

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