As the Middle East undergoes a monumental $2 trillion wealth transfer, family-owned businesses are poised to navigate an extraordinary generational shift. These enterprises have long been the cornerstone of the region: approximately 60 percent of global GDP in the Middle East is now attributed to family-owned businesses, with 80 percent of the Middle Eastern workforce employed by these same companies. These family firms have weathered decades of change by adhering to a long-term vision that emphasizes legacy and family heritage.
However, the past few decades have witnessed unprecedented wealth creation within the region, and the influx of around 6,000 ultra-high-net-worth individuals (UHNWIs) is injecting even more capital into the Middle East. Whether established or newly formed, many single-family offices are grappling with the challenge of balancing heritage and legacy with the demands of a global business environment. The rise of single-family offices in the Middle East and North Africa (Mena) region delves into the remarkable evolution of wealth management, leveraging expert analysis to explore data from 34 family offices and provide a foundational understanding of the mindset driving these structures. Ultimately, in a region where business has long been intertwined with family legacy, the report illuminates how family offices have evolved to help businesses harmonize their roots with their ambitions.
First popularized by iconic dynasties such as the Rockefellers and Rothschilds, family offices have adapted to the challenges and opportunities presented by regions worldwide. Bolstered by local natural resources, the Middle East has experienced significant wealth creation in recent generations, and family offices have become popular tools for integrating modern business practices into family legacy. Nearly 80 percent of survey respondents reported that family members actively worked in the office, with 81 percent holding committee roles, reinforcing the direct familial oversight of wealth management. This integration is epitomized in the family offices’ manifestos: over 60 percent of surveyed offices indicated that their office’s mission was documented in the family constitution, underscoring the fundamental alignment between business principles and family operations.
This deep integration between family and business ethos is reflected in one of the primary priorities of family offices within the region: succession planning. Following immediate economic benefits, succession planning emerged as the most compelling reason to establish a family office, and survey respondents identified it as the top priority in day-to-day operations. Second and third generations are already actively involved in investment decision-making, indicating that future inheritors are part of critical financial decisions. Indeed, in only 30 percent of family offices does the founding generation remain influential, signaling a significant generational turnover. More interestingly, over three-quarters of respondents cited ‘family governance’ as a priority for their family office. It appears that families are not only thoroughly integrated into the workings of the office and business but that the office structure is similarly felt within the family organization; a reciprocal relationship indicating the fundamental integrity of business to family legacy. Ultimately, this thorough entwinement between family governance and business practices appears fundamental to the preservation and growth of wealth across generations.
Despite this integration, younger generations aspire to move beyond the familiar domains of familial wealth. Respondents noted that all next-gen family members had some degree of interest in joining the operating family business, yet what most interested these family members was establishing their own businesses or pursuing alternative career paths. These attitudes are also reflected in the changes brought by second-and-third generations to their historic family offices. Founding generations built their wealth with a conservative approach: in the words of Haleema Humaid Al Owais, CEO of Sultan bin Ali Al Owais Real Estate and Family Wealth Manager, “they started small and never compromised their core operating business,” remaining committed to their central strategy and refusing to consider an exit plan. These family offices were ‘operators,’ entities that solely oversaw the family-owned business and assets. However, with the increasing globalization of the marketplace, aided by technological advancements, younger generations are pushing offices into an ‘operator and investor’ model.
This evolution allows family offices to invest in businesses and opportunities outside of the founding business, enabling families to diversify wealth, expand revenue streams, and increase community impact. Perhaps because of this generational distance, over 60 percent of respondents value next-generation mentoring as important functions of the single family offices. Still, whether inside the family business or out, inheriting generations are seeking new ways to leave their mark on the family legacy.
