The New Private Markets Playbook for Family Offices.

Alternative investments have become a core part of long-term wealth strategies for family offices. Research in 2025 by BlackRock found that they account for 42% of family office portfolios, on average, supported by “their ability to deliver illiquidity premia and differentiated return streams.” 

Private market exposure has grown especially quickly. According to alternatives data provider Preqin, in 2025, the number of family offices with exposure to the asset class rose by more than 520% since 2016. This growth has been accompanied by an increase in the governance and execution capabilities of family offices aiming to extract value from this complex and illiquid space.

Across private equity, private credit, infrastructure and real assets, competition for high-quality opportunities is on the rise. In response, some family offices are moving beyond fund allocation to become active counterparties — sourcing opportunities, shaping capital structures and helping to determine how the private markets landscape develops.

“If you go back 10 years, family office exposure to alternatives was much lower than it is today,” says George Varoutsis, Head of Investment Management for US and Europe International at Deutsche Bank Private Bank. “As the private markets universe has expanded, their approach has become far more sophisticated.”

Larger family offices are hiring investment professionals from private equity, banking and asset management, building formal committees and developing processes for sourcing, diligence and portfolio construction. Some are moving closer to an endowment-style model, combining higher exposure to alternatives with structured governance and direct investment capabilities.

“Family offices have matured and institutionalized their approach,” says Aaron Knapik, Managing Director of fifth-generation family office Somerston Group’s Venture Capital and Private Equity Portfolio. “Operationally, many now resemble specialist investment houses, but they still retain the advantages that come with private ownership.”

Somerston offers one example of how family offices are increasingly directing their patient capital toward sectors that require substantial long-term investment.

Founded in 1854 as a shipping company, it has a long history of investing in infrastructure and disruptive technologies. Its investment business spans public and private markets, including real estate, private equity and technology-led assets such as digital infrastructure and robotics.

Through Trans Pacific Networks (TPN), Somerston is extending its logistics and infrastructure heritage into digital connectivity. TPN is developing low-latency submarine cable routes connecting Asia to the US, while seeking to avoid political hotspots, contested waters and other operational risks. 

Over the last two decades, subsea networks have come to play a critical role in the global economy. According to the International Telecommunication Union, they carry roughly 99% of the world’s internet traffic, enabling financial transactions, cloud computing and communications.

TPN’s capital structure includes more than 100 family offices, with Somerston holding the controlling stake. Many are Silicon Valley-based families with a deep understanding of the sector. The project requires coordination with major technology companies, including Google and Meta.

“For generations, Somerston has focused on identifying pressing economic challenges and deploying long-term capital to help solve them. Today’s investments in digital infrastructure are a continuation of that same philosophy,” says Knapik, who is also TPN’s CFO. “Improving connectivity between Asia and North America unlocks profound macroeconomic ripple effects and national security advantages.”

Infrastructure, like much of the alternatives landscape, is inherently long-duration. Developing a trans-Pacific cable system involves years of complex execution, from multi-jurisdictional approvals and route planning to assessment of seabed conditions, security risks, technical constraints and cable-laying capacity. Once built, the asset may operate for decades.

“The key challenges are mostly around multi-jurisdictional permitting and development. These are overcome by utilizing strongly aligned partners who are equally committed to seeing the projects through to completion,” Knapik explains. 

In such situations, other types of investors may feel unable to absorb the illiquidity and commit to long cycles or periods of volatility, he argues, but “family offices such as ours realize that one of our greatest advantages is being able to focus on goals with much longer horizons than a reporting quarter or year.” 

As family offices move deeper into private markets, access to the right expertise can help shape both diligence and execution. For Somerston, investing in new sectors depends on the ability to build knowledge and identify strategic partners.

“When we enter new markets or sectors, there’s an understanding that we have to get up to speed very quickly,” says Knapik. “The best way for us to do that is to leverage either existing or new relationships.”

Deutsche Bank’s global family office summits have helped build that network, connecting Somerston with other families active in adjacent sectors.

Those relationships can open new pathways for investment. “The network we have built through TPN — spanning hyperscalers, neo-cloud providers, leading industry participants and family offices — has given rise to other opportunities across our portfolios,” says Knapik.

Banks support the activities of family offices, which increasingly operate like sophisticated investment platforms. 

“Family offices are looking for three things from their banking relationships: the ability to deal with complexity, size and speed,” says Arjun Nagarkatti, Head of Private Bank – US & Europe International at Deutsche Bank. “The larger the family office, the more they are looking for banks that can understand the complexity of their needs, provide financing at scale and move quickly when the right opportunity appears.”

Knapik stresses the importance of finding the right banking partner. “When it comes to execution, family offices have come to expect institutional-level service, deep expertise and disciplined delivery,” he says. “Deutsche Bank was able to assess the TPN project, support the financing requirements and provide support across the broader banking needs that come with operating in multiple jurisdictions, from foreign exchange and structuring to regulatory requirements and strategic guidance.”

Family offices and other long-term investors are expected to play an important role in financing the crucial buildout that will help meet global infrastructure demand. 

According to McKinsey’s Global Private Markets Report 2026, many family offices plan to increase allocations to infrastructure, signaling a growing interest in investments that support global growth.

“As families look to build multigenerational wealth, they will continually increase their exposure to alternative, higher-yielding assets,” Knapik says. “We believe some of the most attractive opportunities are often found in private markets, and that family offices are both qualified and strongly positioned to deploy capital to sectors that could benefit from long-term structural trends.”

With patient capital playing a greater role in funding the infrastructure behind the global economy, that long-term perspective positions family offices as key partners in shaping future growth.