Family offices brace for higher inflation with real estate and alternative investments

• Family offices concerned about inflation hold 60% of portfolios in alternatives with twice the exposure to real estate and hedge funds compared to others
• U.S. family offices allocate 40% to public equities and 34% to private investments including private equity, venture capital, private credit and real estate
• AI remains the top investment theme with 65% citing it as part of their portfolio, while 72% have no gold exposure despite retail investors favoring it as an inflation hedge

Family Offices Prepare for Inflation with Real Estate and Alternatives

Key Survey Findings

J.P. Morgan Private Bank surveyed 333 single-family offices with average net worth of $1.6 billion, revealing inflation and interest rates as primary concerns for ultra-wealthy investors in 2026.

Top Portfolio Risks

U.S. Family Offices:

• 64% cited interest rates as a top risk
• 61% cited inflation as a major concern

Global Family Offices:

• Geopolitical risks ranked as the primary threat

Investment Strategy Shifts

Family offices citing inflation concerns hold 60% of portfolios in alternative investments, with notably higher allocations to:

• Real estate (double the typical exposure)
• Private equity
• Hedge funds

Current Asset Allocation

U.S. Family Offices:

• 40% in public equities (largest asset class)
• 34% in private investments (private equity, venture capital, private credit, real estate)
• Significant cash positions maintained for opportunistic purchases or yield generation

Investment Themes

Artificial Intelligence remains the dominant investment focus, with 65% of family offices either holding AI investments or prioritizing them. Other favored sectors include healthcare, infrastructure, and cybersecurity.

Notable Positioning

• Gold avoidance: 72% of family offices have zero gold exposure, with many hesitant to chase recent price gains
• Cash holdings: Family offices maintain substantial liquidity, either awaiting market downturns or capitalizing on elevated short-term rates

David Frame, J.P. Morgan Private Bank's global CEO, emphasized the dual focus on inflation protection and AI exposure, while noting concerns about portfolio concentration in technology.