With ultra-high-net-worth families no longer being concentrated in cities like Mumbai, Delhi, Bengaluru or Hyderabad, family offices are now proliferating in places such as Surat, Ludhiana, Lucknow, Ahmedabad, Nagpur and Coimbatore.
Affluent families from these places, particularly the younger generation, are focusing on setting up these offices to diversify their risks and systematically invest into the equity market, mutual funds, structured instruments, real estate and new asset classes such as startups. According to reports, Surat alone has seen the establishment of around 8-10 family offices in the recent past.
According to a recent PwC report, currently, there are over 300 family offices in India, as against 45 in 2018, and the number is set to rise exponentially, with promoters building impressive businesses in tier-2 and tier-3 cities.
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Out of these 300+ offices, experts estimate 30–40% to be based in industrial hubs and non-metros today. For instance, Dholakia family office in Surat; Torrent Group’s family office in Ahmedabad; Bharat Forge’s family office and Kirloskar Group’s family office in Pune; KG Group’s family office in Coimbatore; Kinetic Group’s family office in Nagpur and many more.
Many multi-family office firms have also cropped up in tier-2 and 3 cities such as Cervin Family Office in Pune and Legacy Growth in Ahmedabad. These firms offer bespoke advisory solutions to many UHNW families.
“Cities like Guwahati, Coimbatore, and Bhubaneswar are already wealth-creation hubs, and their rising affluence makes them natural locations for family offices to flourish,” Anirudh A Damani, managing partner, Artha Venture Fund told FE. He added that as these cities continue to grow, the number of family offices leveraging this wealth will also grow.
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“Setting up and operating a family office in non-metro cities often comes with lower costs compared to metros, making it an attractive proposition for families looking for efficiency without compromising on quality,” Sreepriya N S, co-founder and director, Entrust Family office, a boutique multi-family office catering to HNIs and UHNIs said. The firm offers advisory on investment and non-investment requirements.
Moreover, advancements in technology have made remote management and communication more feasible than ever before.
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