Family Offices Bet Big on Alternatives, But Sit Out the AI Infrastructure Buildout
J.P. Morgan's 2026 report finds family offices piling into alternatives for inflation cover, while 79% hold zero infrastructure exposure despite their AI ambitions.
Family offices are moving more capital into private markets and alternatives to guard against inflation, but most have skipped the infrastructure assets underpinning the AI boom they say they want to back.
That is the central tension in J.P. Morgan Private Bank's 2026 Global Family Office Report, which surveyed 333 offices across 30 countries. The findings point to a sector recalibrating for a more uncertain, higher-inflation world while leaving a visible gap between stated priorities and actual holdings.
Inflation pushes capital into alternatives
The report shows family offices that name inflation as their primary risk allocate nearly 60% of portfolios to alternatives. That is roughly 20 percentage points above the survey average.
These offices concentrate in hedge funds and real estate. Their average allocations to those assets run close to double the broader group, at 25% versus 12%.
The pattern reflects a wider shift away from public markets toward private and illiquid strategies. Family offices, with long time horizons and few redemption pressures, are structurally suited to hold assets that institutional investors and retail funds often cannot.
The infrastructure gap
The more striking finding sits in what family offices are not buying. According to the report, 79% hold no allocation to infrastructure at all.
That matters because infrastructure, power, connectivity, and logistics, forms the physical layer of the AI systems these same investors say they want exposure to.
The disconnect is sharp. The report found 65% of family offices plan to prioritize AI, yet more than half have no exposure to venture and growth markets, where most AI innovation is being funded.
In other words, the appetite for AI is widespread, but the capital is not following into the assets that build and run it. Many family offices appear to want the theme without the underlying ownership.
Caution on gold and crypto
Even with geopolitical risk rising, family offices have not turned to traditional or emerging hedges in large numbers. The report found 72% report no gold exposure, and 89% report no exposure to cryptocurrencies.
The reluctance toward crypto is notable given how much attention digital assets have drawn across Asia's wealth centers in recent years. The data suggests that interest among ultra-wealthy families has not translated into meaningful allocation.
Governance becomes a risk tool
For families that own operating businesses, internal dynamics rank among the top concerns. The report found 41% of business-owning families identify internal conflict as a top-three risk, nearly double the rate of families without operating businesses.
In response, these families are more likely to put formal governance structures in place. The report frames governance as a way to align stakeholders and support continuity across generations, not just to manage financial or operational exposure.
Rising costs of running an office
Building investment capability comes at a price. For family offices managing more than $1 billion in assets, average annual operating costs now exceed $6.6 million, according to the report.
J.P. Morgan attributes the increase to competition for talent and the cost of operational resources. As family offices expand into private markets and direct deals, they need staff and systems that resemble those of institutional asset managers.
What it means for Asia
The survey covers offices in 30 countries, and Asia's family offices are a fast-growing share of that universe, particularly in Singapore and Hong Kong. The regional buildout of AI data centers and power capacity puts the infrastructure gap in sharper relief for investors based here.
Family offices in the region have long favored real estate and private equity, which aligns with the report's broader tilt toward alternatives. The open question is whether they extend that comfort with illiquidity into infrastructure, an asset class most still avoid.
The report describes a sector making deliberate, long-term choices rather than chasing headlines. On AI infrastructure, though, the deliberation has so far meant staying on the sidelines.
