Situated on the doorstep of China, the second-biggest and fastest-growing global superpower, Hong Kong is a two-way gateway between the West and Eastern economies. This insight explores why Hong Kong is a leading location for family offices and highlights some of the largest local family offices in the region.
A Brief History of Hong Kong
Hong Kong has a rich history, most recently reaching the 19th century. Its natural harbour made it the contentious battleground between the British and the Chinese government. The opium wars in the late 1800s ultimately ceded the region to British rule on a 99-year lease. Under the lease, Hong Kong underwent a significant transformation. It deployed a capitalist economic system, which saw the rise of its modern society. As a free port, Hong Kongers freely facilitated international trade without tariffs, and its global commerce flourished. The unique blend of Eastern and Western influences drove the region’s metamorphosis from a simple fishing village to a highly developed financial centre district.
Current economic climate
In 1997, when the lease ended, the Chinese government made a new agreement with Hong Kong called the “One country, two systems” policy. The policy ensured that Hong Kong would continue to operate under the capitalist system for the following 50 years. Today, Hong Kong remains a free port for international trade and is one of the leading financial centres in the world. It maintains its own independent economic and legal system. And can also freely establish and maintain economic relations with other regions and countries.
New family office policies in Hong Kong
With this background in mind, the Hong Kong government is shifting gears to bolster its image as the financial hub for the Asia-Pacific region. With competing countries on the rise, such as Singapore, it is implementing new legislation to attract high-net-worth individuals and single-family offices to its shores. The new legislation provides family offices with tax exemptions and other benefits for conducting investment activities. The government is also funding various initiatives to accelerate these efforts, including a dedicated $100 million to InvestHK to attract 200 more family offices to the city by the end of 2025.
Measures to attract family offices
The Financial Services and the Treasury Bureau is leading an initiative in Hong Kong called “Wealth for Good in Hong Kong.” This program is dedicated to promoting technology, philanthropy, green finance, and art in family office businesses. Other measures to encourage family offices to come to the area include:
Immigration
Hong Kong created the Capital Investment Entrant Scheme (CIES) to make it easier for wealthy individuals and family offices to immigrate. By investing in Hong Kong’s asset markets, like equities, government and corporate bonds, applicants can get permanent residency for themselves, their spouses, and their children under 18. The minimum asset threshold is HK$10 million (around $130K) for an eligible applicant. The aim is to attract young HNWI and a talent pool to the region.
Tax concessions
Hong Kong has passed a tax concession bill offering a tax exemption for eligible family offices. The bill exempts tax from profits earned by family-owned investment holding vehicles (FIHV). The FIHV must be managed or controlled in Hong Kong during the assessment year’s basis period and meet the minimum asset threshold of HK$ 240 million (around $30 million). The move is to foster Hong Kong’s position as an international asset and wealth management centre.
Philanthropy and art
The government plans to develop Hong Kong into a philanthropic centre for global family offices and philanthropists. The dedicated FamilyOfficeHK, another government-led initiative, has expanded its role to cover services like facilitating philanthropic endeavours of wealth owners and assisting in education-related matters. In addition, the Hong Kong Airport Authority is exploring establishing storage, display, and appreciation facilities for art and treasures at Hong Kong International Airport.
Hong Kong – leading the way for family offices
Due to its advantageous location, robust financial infrastructure, and favourable economic policies, Hong Kong is championing the cause of the family office industry. Its history as a free port and financial centre, along with the “One country, two systems” policy, has attracted many wealthy individuals from mainland China seeking stability and autonomy.
The government leads various initiatives, including tax exemptions, funding opportunities, and philanthropic support, to further encourage the establishment of family offices in the city. With its continuous efforts, Hong Kong could quickly become a top choice for family offices looking to safeguard and expand their wealth in the Asia-Pacific region.
The largest family offices in Hong Kong
Hong Kong is fast becoming the leading spot for family offices. Here are the ten largest family offices in Hong Kong:
Sir Elly Kadoorie & Sons Ltd
Sir Elly Kadoorie & Sons Ltd is a single-family office located in Hong Kong. It was established in 1880 by Sir Elly Kadoorie and his brother, Ellis Kadoorie. The Kadoories invested in many have included power generation, telecommunications, real estate, hotels, banking, and other industries. The company has had a significant impact on the development of Hong Kong’s economy.
KHI Holdings Group
Kwong Hing Investment (KHI) Group was founded in 1947 and is the family office of Hong Kong businessman Fu Hou-Ze, Chairman of KHI Holdings Group, a property developer. The Fu family was prominent in Macau’s casino business before migrating to Hong Kong. The family office currently has two branches, one focusing on Hong Kong and the other on overseas investments. The firm engages in property investments, asset management and direct investments across geographies.
Bright Success Capital
The Bright Success Capital single-family office serves as the private investment vehicle of Hilton Tam and his family. Created in 2014, the family office focuses mainly on venture capital investments in consumer electronics manufacturing. Its notable investments include 23andMe, Spotify and SpaceX. Hilton Tam is the CEO.
Empire Group Holdings
Empire Group Holding was founded in 2010 by visionary property innovator and investor Dr Walter Kwok. Walter Kwok is the eldest son of Kwok Tak-Seng, founder of Sun Hung Kai Properties, listed as the largest property developer in Hong Kong. The whole Kwok family was ranked one of Asia’s Richest Families, with an estimated net worth of US$40.4 billion.
Horizons Ventures Limited
Horizons Ventures is the single-family office of Li Ka-Shing and his family. Nicknamed Superman, Li Ka-Shing is revered as one of the most influential businessmen in Asia. The firm was founded in 1999 by Mr Li Ka-Shing, Debbie Chang, and Solina Chau in Hong Kong. Horizons Ventures invests primarily in technology, media, and telecommunication companies. Notable companies Horizon Ventures invested in include Siri, Facebook, Slack, Skype, and Spotify.
Legacy Advisors Limited
Legacy Advisors Limited was founded in 1995 by James Chen, the Chairman of Wahum Group Holdings, a third-generation family-owned manufacturing business. An active philanthropist, in 2003, Chen was instrumental in founding the family’s philanthropic arm – the Chen Yet-Sen Family Foundation – and is currently Chairman.
Search Investment Group
Search Investment Group is a single-family office based in Hong Kong of Robert W Miller and his family. Miller is a founding shareholder in Duty-Free Shoppers (DFS), the world’s leading retailer to the travelling public. Since Miller established the Search Investment Group in the early 1970s, the firm has made a variety of investments around the world. SAIL Advisors Limited, better known as SAIL, is an alternative asset management firm based in Hong Kong that manages funds of hedge funds portfolios invested by the Search Investment Group.
Chow Tai Fook Enterprises Limited
Chow Tai Fook Enterprises Limited manages the fortunes of Hong Kong billionaire Cheng Yu-Tung and his family. Henry Cheng is the CEO. He succeeded his late father, Cheng Yu-tung, as Chairman of the family flagship firms Chow Tai Fook Jewellery and New World Development. The firm focuses on real estate investment as one of its core strategies. The family is estimated to be worth $28.9 billion.
Sterling Private Management Limited
Sterling Private Management is one of Asia’s most established single-family offices, managing the wealth of Hong Kong’s real estate tycoons, Chen QiZong and Chen LeZong, who established the publicly listed Hang Lung Group. The family office is involved in wealth management, offshore fund management, trust administration, treasury services, and philanthropic activities through private foundations.
Hefeng Family Office
Hefeng Family Office is a leading multi-family in Hong Kong. It has offices in Beijing, Guangzhou and Hong Kong Central. It offers investments, wealth structuring, tax and estate planning, philanthropy, trust and family enterprise governance. The firm is led by Jiang Songcheng, as a founding partner and Managing Director.