Welcome back to Off Market. This issue looks at the current generational transfer gap building quietly inside family office real estate platforms, with facts and figures.
TL;DR
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Family offices have meaningfully expanded direct real estate investing over the past two years, and real estate remains one of the largest, fastest growing allocation categories for platforms with significant assets under management.
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Roughly $84 trillion is projected to change hands through 2045, most of it from Baby Boomer households, and a meaningful share of that wealth sits inside real estate platforms built and run by a single founding principal.
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Only 5% of U.S. family offices say the next generation is fully involved in running the office today, and just over a quarter run an organized process to prepare them for it.
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Succession surveys disagree with each other sharply, from roughly a quarter of offices calling themselves fully prepared to clear majorities claiming a formal plan exists, and that gap is itself the signal. Having a plan and being ready are not the same thing.
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For real estate specifically, the risk isn’t just the money. It’s the off market relationships, the lender trust, and the underwriting judgment that often live entirely in one person’s head.
A Different Kind of Leadership Cliff
Most of the succession conversation in real estate is about institutional platforms. Boards managing CEO transitions. REITs refreshing their bench ahead of the next cycle. That’s a real story, and a visible one.
The quieter version of this is happening inside family office real estate platforms, and it looks nothing like a board-managed transition. In a lot of these platforms, there is no bench. There’s one principal who built the thing, who personally holds the broker relationships, who personally underwrites every deal, who personally decides which operating partners and sponsors get trusted with capital. The judgment, the relationships, and the deal flow all live in one person.
When that person steps back, whether by plan or by circumstance, the platform doesn’t lose a manager. It loses its entire operating memory at once.
What the Data Actually Shows
The scale of this is bigger than most people assume. Roughly $84.4 trillion in wealth is projected to change hands through 2045, with more than $53 trillion of it, 63% of the total, coming from Baby Boomer households (Cerulli Associates, 2025). High net worth and ultra high net worth households, just 1.5% of all households, account for $35.8 trillion of that transfer on their own (Cerulli Associates, 2025).
A lot of that wealth sits inside real estate. And the readiness numbers behind it are not reassuring. UBS’s 2025 Global Family Office Report found that only 5% of U.S. family offices say the next generation is fully involved in running the office today, with another 33% partially involved. Just 35% have a formal succession plan for the office itself, and only 27% run an organized process to prepare the next generation for the handoff (UBS Global Family Office Report, 2025).
Bank of America’s 2025 Family Office Study adds a timing dimension: 87% of offices have not yet gone through a leadership transition, but nearly six in ten expect to within the next decade, and a third expect it within five years (Bank of America Family Office Study, 2025).
Here’s the part worth sitting with. Ask a different set of family offices the same question and the answer changes. Campden Wealth and RBC’s 2025 North American report found 69% of family offices report having a formal succession plan, up from 53% the year before, with 47% expecting control to shift to the next generation within a decade (Campden Wealth and RBC, 2025). Ocorian’s 2026 global report puts the share who consider themselves fully prepared at roughly one in four (Ocorian, 2026).
Those numbers don’t agree with each other, and that’s the actual finding. A majority of offices believe they have a plan. A much smaller share believes they’re genuinely ready. The gap between those two numbers is where the risk lives.
Why Real Estate Makes This Harder Than a Stock Portfolio
A publicly traded portfolio transfers cleanly. The next generation, or the professional manager stepping in, inherits a position that’s liquid, priced daily, and doesn’t depend on anyone’s personal relationships to hold its value.
A direct real estate platform doesn’t work that way, and family offices are leaning further into direct exposure, not less. Citi Private Bank’s 2025 Global Family Office Report found 70% of family offices now participate directly in private deals rather than through fund vehicles, and Goldman Sachs found 44% of family offices prefer direct investment in private real estate specifically (Citi Private Bank Global Family Office Report, 2025; Goldman Sachs, 2025). S&P Global Market Intelligence reported that global family office direct investments more than doubled in 2025 (S&P Global Market Intelligence, 2026), and Knight Frank’s Active Capital Survey has office, residential, and industrial or logistics ranked as the top three targeted sectors globally for 2026 (Knight Frank Active Capital Survey, 2026).
Direct exposure means the platform’s value depends on things that don’t transfer automatically: the lender who picks up the phone because of a fifteen year relationship, the broker who brings the off market deal to this principal before anyone else, the operating partner who was chosen because the principal vetted them personally years ago. None of that sits in a data room. It sits in one person’s judgment and one person’s relationships, and it’s growing as a share of family office wealth, not shrinking.
What Actually Predicts a Smooth Transition
The research points to a few things that matter more than the rest.
Early, real involvement beats a late formal process. UBS’s data found that more than 40% of highly involved principals begin bringing the next generation in as soon as they express interest, versus less than a third of less involved principals who do the same (UBS Global Family Office Report, 2025). Waiting for a milestone birthday or a formal handoff date to start the conversation is already late.
Bringing in a professional, non family leader as a bridge works, and it’s underused. A hired President, Chief Investment Officer, or Head of Real Estate can hold the operating relationships and the underwriting discipline while a next generation principal grows into ownership, rather than asking one person to absorb both the family transition and the operating job at the same time. This is one of the more common searches we run for platforms in this position, and it tends to work best when it starts well before the transition is urgent, not after.
Documented judgment beats remembered judgment. The platforms that hold up best are the ones where underwriting standards, sponsor vetting criteria, and lender relationships are written down and shared, not carried entirely in one person’s head. It’s a simple fix that most platforms only make after a scare.
The Window Is Now, Not Later
Put the two trends next to each other. Family offices are expanding direct real estate exposure at the same time a third of them expect a leadership transition within five years (Campden Wealth and RBC, 2025). The exposure that’s hardest to hand off cleanly is growing exactly as the clock on succession is shortening.
This isn’t a distant estate planning topic. For a lot of platforms, it’s a near term operating risk sitting inside the real estate book right now.
The Things Worth Holding On To
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The wealth transfer numbers are vast, but the real risk isn’t the money moving. It’s the relationships and judgment behind a direct real estate platform that don’t transfer on their own.
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Succession surveys disagree with each other because “having a plan” and “being ready” are different things. Assume you’re closer to the honest number than the optimistic one.
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A professional leader brought in as a bridge, early and deliberately, is one of the more reliable ways to protect a real estate platform through a family transition. Waiting until the transition is already underway is the expensive version of this.
Family wealth research has tracked this pattern for decades: a large share of family wealth doesn’t survive to the second generation, and most of what’s left doesn’t make it to the third (Williams Group multigenerational wealth research). Real estate platforms built around one principal’s relationships are exactly the kind of asset that pattern tends to catch.