Alumni Business Talk: Hong Kong's Rise as a Global Hub for Family Offices

Alumni Business Talk: Jacky Leung (Class of 2018) on Hong Kong’s Rise as a Global Hub for Family Offices
5 min read

In recent years, Hong Kong has been actively positioning itself as a leading destination for family offices worldwide. With its strategic location at the heart of Asia and its status as an international financial centre, Hong Kong offers a unique set of advantages that make it an ideal choice for establishing family offices.

This month, we sat down with Jacky Leung (HKU MBA, Class of 2018) who shared his thoughts on Hong Kong as an international hub for the family office sector, how Hong Kong connects and compares to other important financial centres globally, and opportunities for talents entering this field.

Jacky is the Founder and Chairman of Royal Family Office. Prior to starting his own venture, he served as the Senior Vice President of Family Office at InvestHK.

Opportunities for Hong Kong to be a Global Family Office Hub
“The Hong Kong government has been proactive in promoting the family office sector. The Chief Executive has set a target of attracting over 200 new family offices by 2025, emphasising the government’s commitment to the sector’s growth. Various policies and initiatives to attract these entities are being implemented. One notable effort is the tax concession scheme introduced in May 2023, which provides tax incentives for single family offices setting up in Hong Kong. In my experience, around 45% of new family offices are from Mainland China, while around 25% of them come from Southeast Asia.”

“The government’s dedication to promoting family offices is further evident in its efforts to engage high-net-worth individuals to the city. In March of 2023, Hong Kong hosted a global event called “Wealth for Good in Hong Kong”, where over 120 billionaires were invited to explore the benefits of establishing family offices in the city. The Chief Executive and the Financial Secretary personally met with the attendees to discuss the topic, resulting in a significant number of participants either setting up or planning to establish their family offices in Hong Kong.”

Qualities of Hong Kong as a Natural Destination for Family Offices
“There are numerous reasons for Hong Kong’s growing popularity as a destination for the family office sector. First and foremost, Hong Kong’s legal system, which shares similarities with the British legal system, provides a sense of familiarity and security for foreign investors. The absence of capital controls allows for the free flow of funds, a crucial consideration for family offices managing substantial assets. Furthermore, Hong Kong boasts robust financial markets and strong initial public offerings (IPOs), contributing to its appeal as a wealth management destination.

Hong Kong vs. Other Markets
“In comparison to other global markets, Hong Kong stands out as a frontrunner in the family office sector. As of December 2023, Hong Kong had approximately 6,000 family offices. This statistic includes both single family offices and multi-family offices, indicating the significant growth potential of the sector in Asia.”

“The region, particularly countries like Indonesia, Vietnam, Japan, and India, has witnessed notable economic growth, making it an attractive investment landscape for family offices. And while the Chinese Mainland is still consolidating their economic recovery, the country remains an important player in the industry. As part of China, Hong Kong continues to enjoy its unique status internationally.”

“When choosing between Hong Kong and Singapore, two prominent financial centres in Asia, each city offers its own distinct advantages. Hong Kong’s financial market is significantly larger than Singapore’s in terms of volume, trade, and transaction activities. It also boasts a vibrant financial ecosystem and a robust talent pool of lawyers, accountants, and wealth management practitioners. On the other hand, Singapore is known for its efficient government and responsive policies, making it an appealing choice for family offices with a focus on Southeast Asia.”

“It is worth noting that Hong Kong and Singapore are not mutually exclusive options, and many family offices choose to establish a presence in both cities. Larger family offices often have multiple locations to cater to their diverse clientele and take advantage of the strengths each city offers.”

“Looking beyond Asia, the Middle East has emerged as a significant source of potential investors. Hong Kong, along with the Chinese Mainland, recognises the importance of building stronger ties with the Middle East. High-level visits by Senior Government Officials to the region demonstrate the commitment to establishing robust connections. Moreover, Middle Eastern capital is seeking investment opportunities in Asia, further emphasising the potential impact of this region on Hong Kong’s family office sector.

Opportunities & Attributes of Talents for the Family Office Sector
“In terms of career opportunities, professionals with backgrounds in banking, private banking, and legal sectors are well-suited to enter the family office industry. However, there is a demand for specialists in areas such as family constitutions and family councils, as well as experienced gatekeepers for single family and intergenerational family offices. Hong Kong’s educational institutions, including HKU and HKU Space, offer courses on family office-related topics, providing individuals with the necessary knowledge and skills to excel in the industry.”

“Success in the family office sector requires strong interpersonal and problem-solving skills. Dealing with multiple generations and resolving conflicts among family members are common challenges that demand effective communication and negotiation abilities. While technical expertise in financial planning, trust planning, and wealth management is essential, the ability to navigate complex family dynamics and deliver satisfactory solutions is equally critical. Hong Kong’s aspirations to become the leading destination for family offices globally are well-founded. With its favourable legal system, thriving financial markets, and government support, the city offers an attractive environment for family offices to thrive. As the sector continues to grow in Asia and beyond, Hong Kong’s position as a hub for family offices is set to strengthen, propelling the city to the forefront of global wealth management.”

About the Alumni Business Talk series
In this new series, we sit down with HKU MBA alumni across industries each month to get an insight into current trends in the world of business and their leadership journeys to inspire and empower.