Private equity (PE) and venture capital (VC) remain cornerstone allocations for sophisticated investors. These asset classes continue to offer strong return potential, but increasingly, families are drawn to the sense of control and influence that comes with them. According to bfinance, 100% of surveyed family offices have exposure to private equity, and half intend to increase their allocations. For many, this is more than a financial decision – it’s a way to play an active role in shaping the future of business, backing transformative founders and ideas.

Direct investments and co-investments are also gaining momentum, especially in sectors where innovation is rewriting the rules. Family offices are gravitating toward deals in artificial intelligence, biotechnology, and fintech – areas that align with their long-term convictions and values. These investments offer the opportunity to go deeper than traditional fund commitments, allowing families to partner directly with entrepreneurs and steer outcomes more meaningfully. The appeal lies not just in potential upside, but in engagement and impact.

Real estate continues to serve as a steady pillar in portfolio construction, delivering a rare combination of yield, appreciation, and tangibility. According to the 2025 Knight Frank Wealth Report, 28% of family offices have increased their allocations to property. The breakdown of preference is telling: commercial office spaces (20%) remain attractive in select geographies, luxury residential (17%) is rebounding post-pandemic, industrial properties (14%) benefit from the logistics boom, and hospitality assets (12%) are seen as high-upside plays amid global travel recovery.

Importantly, the approach to real estate is evolving. Investment strategies are increasingly skewed toward opportunistic (32%) and value-add (30%) plays, with a clear preference for medium- to long-term horizons. These are not short-term speculations. Families are thinking about how these assets can serve multiple generations – building income resilience, anchoring estates, and in many cases, enabling social utility through thoughtful development.

Fixed income, once cast aside during years of ultra-low interest rates, is now enjoying a marked resurgence. With yields returning to levels not seen in over a decade, nearly half of respondents in Citi Private Bank’s latest survey reported increasing their allocations. This reflects a broader return to quality, predictability, and income generation – especially amid rate volatility and a more cautious macro environment.

Private credit, meanwhile, is emerging as a complementary asset for families seeking attractive, risk-adjusted returns. In an environment where traditional banks are pulling back from lending, private lenders have stepped into the gap – offering more consistent yield and tailored deal structures. But families are not blind to the risks. Interest rate exposure, liquidity constraints, and counterparty diligence are top of mind, prompting many to tread carefully and prioritise transparency in manager selection.

Strategic debt exposure is a major theme in 2025. According to BlackRock’s latest global family office survey, nearly one in three offices plan to increase allocations to private credit and infrastructure debt, capitalising on the secular shift in lending. Simultaneously, 38% are increasing their exposure to public fixed income, signalling a broad rebalancing effort and a renewed appetite for duration. Across the board, families are reorienting their portfolios toward dependable cash flows – whether through investment-grade bonds or structured credit vehicles.

Digital assets, once a niche frontier, are now earning their place on the family office agenda. A recent BNY Mellon report reveals that 39% of single-family offices either hold or are actively exploring cryptocurrency investments. Though allocations remain modest, averaging around 1.8%, the direction of travel is clear. Crypto is increasingly seen not as a speculative punt, but as a tool for diversification, inflation hedging, and exposure to blockchain-based infrastructure. As regulatory clarity improves and custody solutions mature, more families are tiptoeing into this space with cautious optimism.

Volatility and governance remain watchpoints, but the tone has shifted. Digital assets are no longer seen solely through the lens of retail hype. Instead, they’re viewed as part of a broader thematic play on decentralisation, digital ownership, and alternative store-of-value systems. For younger generations within families, this is often their first foray into investing – and one that shapes how they see risk and opportunity.

Beyond financial assets, real assets are enjoying renewed attention. Gold, fine art, vintage cars, rare wines – these aren’t just collectibles; they’re expressions of taste, identity, and permanence. According to Investopedia, allocations to alternative investments are on the rise, with a growing emphasis on tangible value and cultural legacy. For many families, these assets reflect something deeper than returns: continuity, meaning, and an emotional connection to wealth stewardship.

Environmental, Social, and Governance (ESG) considerations have moved firmly into the mainstream. No longer a niche interest, ESG investing is now an integral part of portfolio construction – particularly in Europe where 57% of family offices engage in sustainable or impact-oriented investments, up sharply from 45% in 2021. This isn’t just driven by regulation or optics. It’s the influence of next-generation family members, who are insisting that their capital aligns with their values.

From renewables to microfinance, families are supporting businesses that don’t just perform but serve. Clean energy, climate technology, inclusive finance, and equitable housing are all gaining traction as themes. The shift marks a redefinition of what it means to invest well: performance and purpose, profit and principle, no longer seen as mutually exclusive.

Innovation-focused strategies are also gaining ground, particularly those that provide early exposure to paradigm shifts. AI, blockchain, robotics, clean tech – these are no longer science fiction. Family offices are partnering with venture funds or building their own innovation vehicles to access frontier technologies early. These bets reflect more than a quest for outsized returns. They represent a worldview: that capital can shape the future, not merely ride it.

At the same time, families are acknowledging the growing need for geographic diversification. With geopolitical risks rising and local market volatility increasing, there’s a measured pullback from traditional strongholds. While allocations to North America and Europe have declined slightly, exposure to Asia-Pacific has grown from 20% to 22%, reflecting confidence in its long-term growth narrative. Latin America is also inching upward, while the Middle East and Africa remain stable. Currency risk, capital controls, and jurisdictional law are being more closely analysed, as families hedge both returns and political risk.

In 2025, the smartest families are pursuing investment strategies no longer siloed by asset class or geography – they are adaptive, layered, and guided by both intuition and insight. Their portfolios combine the enduring with the emergent: solid foundations in private markets and real assets, a deliberate pivot toward sustainability, and a disciplined embrace of transformative technologies and ideas.

This new paradigm is not merely about wealth preservation, but about legacy creation, value alignment, and strategic influence. It marks a shift from passive ownership to active stewardship – from wealth as accumulation to wealth as agency. In this landscape, capital is not judged by how much it grows, but by what it enables: stability, progress, and continuity in a world that rewards foresight. Purposeful capital is not a trend. It is, unmistakably, the new default.