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January 9, 2018

The family office: Looking for sound Thai investments

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Thailand in the focus of international family offices

Family offices are highly specialized private wealth management advisory firms with a multi-generational approach. They provide an outsourced financial and investment solution for high-net-worth investors (HNWI’s). As a single-family office (SFO), first pioneered by the Rockefellers in the late 1800s, the client is only one individual or a rich family, while multi-family offices (MFO’s) serve numerous ultra-high net worth clients.

Apart from performing the day-to-day administration, centralized management or oversight of investments, tax planning, estate planning, and asset protection, they are typically in charge of insurance, family related employment, philanthropic intentions and charitable giving, family governance, and even concierge services and lifestyle management.

Under local legislation, single-family offices do not have to register as investment advisers and are widely unregulated. It can be estimated that there are more than 10,000 globally, about half of them set up in the past fifteen years and roughly 3,000 in North America alone. While a family office makes sense with a wealth of US$ 500 million or more, all combined control an estimated US$4 trillion.

A sensible asset diversification across several asset classes, jurisdictions and risk profiles is a cardinal aspect of a private wealth management practice. Therefore, family offices from Europe, North America, Arabia, Russia and even Asia show increasing interest for a family-style investment in Thailand’s industries, properties, and people for wealthy clans abroad.

Family affairs in Thailand: The foreign family office as venture investor

Traditionally, family offices are engaged in direct investments in private equity and venture capital, agriculture and commodities, real estate and valuables (art, etc.). They have the ambition and ability to cherry-pick the best deals. However, particular requirements have to be met.

The primary goal of a family office is to invest wealth prudently and extend it beyond generations. Accordingly, investments have to fit the family’s long-term wealth-generation strategy. As an additional requirement, they typically desire more transparency in underlying investments. Specific rules might disallow any connection to corruption and bribery, child labor, workers’ exploitation, environmental destruction and other forms of non-compliance with the family’s fundamental beliefs and social values.

Typical family office ventures in Thailand are sustainable energy, agriculture, and livestock investments. Examples are the acquisition of solar farms with long-term offtake agreements with government agencies, the breeding of halal and Kobe-style cattle, and a farm for superfoods free of poisons and toxics.

The Consulting House: The family office office in Thailand

Investments in unknown territories require qualified and trustworthy advice. Not everything that is legally permitted is also solid and sound. The Consulting House advises international family offices how to prudently invest in Thailand’s industries, property, and people.

While not providing financial services and investment advice, the Consulting House has the long-term experience and wisdom to separate risky or unreasonable ventures from sustainable family-style investments in the land of smile. This includes the practical implementation of investment strategies taking into consideration the family’s values and compliance requirements.

From its strategically favorable location in Bangkok’s central business district, investments all over Thailand can be implemented, maintained, monitored and controlled. This includes legal and tax aspects, accounting, audit and more. A sophisticated reporting system gives the foreign family office around-the-clock access to its investments and ventures.

The Consulting House offers to international family offices trustworthy cooperation from the first consideration, the successful investment and financial closing as well as the whole investment lifecycle till a possible exit and disinvestment. Confidential talks can be arranged instantly.

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