Family offices are rapidly evolving from traditional, low-profile wealth vehicles into sophisticated, agile power brokers in the commercial real estate sector. While some borrowers still picture family offices as passive, conservative investors, the reality is very different, and understanding this shift can offer a competitive edge in today’s market. Below is a summary of the changing profile of family offices.

Family Offices Now Rival Institutions

Family offices have grown exponentially, with many now operating at a scale and sophistication that rivals institutional players. They bring both expertise and capital, making them critical participants in CRE deals—often capable of moving more quickly and creatively than larger institutions.

Flexibility Is Their Superpower

Unlike funds or insurance companies, family offices are not bound by strict investment guidelines or short time horizons. They can invest opportunistically—buying, lending, or recapitalizing whenever the right opportunity arises and holding assets for the long term, which allows for greater deal flexibility and partnership potential.

Increased Appetite for Risk and Innovation

Today’s family offices are not just seeking “safe” stabilized assets. Many show a heightened appetite for risk, especially when institutional capital pulls back. This includes pursuing complex recapitalizations, distressed debt, value-add plays and even ground-up developments, often seeking IRRs in the high teens or 20%+ range depending on risk and sector exposure.

Sophisticated Structures and In-House Platforms

Many family offices are building comprehensive real estate investment platforms, staffed by experienced professionals rather than being managed solely by family members. They routinely employ intricate deal structures—preferred equity, mezzanine debt, programmatic joint ventures, and more—to tailor returns and control in ways that make sense for both their needs and those of their operating partners.

Private Credit Is a Target Growth Area

With banks receding from parts of the CRE lending market, family offices are stepping in as private credit providers. They’re closing value-add and construction loans, bridge financings and redevelopment debt, sometimes across asset classes many lenders would ignore (retail, office conversions, covered land deals).

Connection and Club Deals Amplify Their Reach

Family offices increasingly work together—syndicating or pooling capital with trusted counterparts to tackle deals that would otherwise be too large or complex. This “club deal” dynamic means borrowers may encounter family office money in much larger, blended transactions than in years past.

Globalization and Expansion of Mandates

Today’s family offices aren’t just local or national. Many are seeking co-investment partners globally and are open to deploying capital outside their “home” markets—sometimes even transitioning their platforms toward institutional fund models to attract other family and third-party capital.

Not Just Passive Capital—But Strategic and Discerning Partners

CRE borrowers should not assume that family offices are easy marks or willing to overpay. These investors are often very sophisticated, leverage deep market intelligence and are willing to bet on contrarian opportunities, but always with conviction and due diligence. They may act quickly, but it is with a practiced hand and an eye for value.

Long-Term Focus But Opportunistic by Nature

While they have a reputation for playing the long game, family offices are also extremely opportunistic. They can capitalize on market cycles, act decisively in periods of distress and pivot strategies based on where they see value—be that equity, debt, direct ownership, or redevelopment.

Premium on Speed, Discretion and Certainty of Execution

Many family offices can close quickly, with minimal bureaucracy, making them attractive counter-parties for sellers/lenders seeking speed or deal certainty. Sometimes they will pay slightly less than competitors but win the deal because they can deliver on a fast and reliable closing.