Deloitte forecasts over 2,700 family offices in Hong Kong with at least 200 more expected this year, surpassing Singapore’s growth

21st March 2024 – (Hong Kong) Deloitte’s latest research, conducted in collaboration with Hong Kong’s family offices, reveals that the city boasts over 2,700 single-family offices, indicating rapid growth within the local industry. Hong Kong, with a wealth management heritage tracing back to the late 1800s, has established itself as one of Asia’s largest hubs for cross-border wealth management, outpacing Singapore.

Patrick Yip, Vice Chairman of Deloitte China, noted that by the end of last year, Hong Kong’s single-family offices managing assets over HK$10 million had reached 2,703, in stark contrast to the 1,400 registered in Singapore. These offices, operating out of Hong Kong, represent families from the local region, mainland China, and Southeast Asia.

However, Yip mentioned the difficulty in directly comparing data between the two cities due to Singapore’s registration and regulatory approval requirements for family offices, which Hong Kong does not impose. Despite this, Deloitte forecasts an addition of 200 to 300 family offices in Hong Kong this year alone.

Tax incentives have been a significant draw for international individuals to establish family offices in Hong Kong. Following the enactment of tax exemptions for single-family offices on May 19 last year, individuals from Germany, France, the UK, and other European countries have shown interest in setting up new offices in the city. This interest is fueled by optimism in China’s economic prospects, the desire for tax benefits for future generations, and the opportunity to tap into mainland China’s market through Hong Kong.

The city’s advantages in family office operations surpass those of Singapore due to its no-approval-needed policy and supportive government initiatives. He predicts that with these strengths, Singapore will struggle to catch up, projecting that the total number of single-family offices in Hong Kong could exceed 3,000 this year.

Addressing concerns over the impact of Sino-American tensions and geopolitical uncertainties on Hong Kong’s appeal as a family office hub, Yip reassured that the city’s status becomes ever more significant amidst geopolitical strains, thanks to its free economy, capital flow freedoms, low taxes, and linked exchange rate system.