As the financial position of countries in the Gulf continues to go from strength to strength, family offices are increasingly establishing a base in the UAE. With the opening of Addepar’s new Dubai office, we explore what’s drawing family offices to the region — and how we can help our clients thrive in this evolving financial hub. 

A region on the rise

In the Middle East, investment and development dominate the financial landscape. With an influx of ultra-high-net-worth individuals — alongside the benefits brought about by the Gulf Cooperation Council’s political, regional, and economic union — financial centres such as Bahrain are being matched and outpaced by the UAE’s rapid rise. This surge has led to significant growth in family offices and the assets they manage.

“The UAE has built its name for being the safe haven for ultra-high-net-worth individuals and families in recent years,” notes Family Office resources specialists, Agreus Group. “With the introduction of favourable regulatory frameworks and policies, the country is set to be the next Family Office hub.”1

Throughout the 21st century, the UAE has successfully diversified its economy, investing in tourism, business and infrastructure to support high-growth opportunities. Ranked first in MENA for ease of doing business2 and first in the Arab world on the Global Innovation Index3, the UAE is attracting wealthy families and family offices at an unprecedented rate, with the number of family offices growing by 6.2% last year alone.4 According to HSBC Global’s ‘The MENA Family Office Landscape Report,’ “one-quarter of family offices were established in the last five years, highlighting the rise of ultra-high-net-worth families in the region and the growing appeal of family offices.”5

Made for family offices?

The UAE’s investor-friendly initiatives, particularly in its 45+ Free Trade Zones, have created an environment conducive to growth. Governed by independent, sector-specific regulations, these zones offer streamlined processes for setting up enterprises and various financial advantages.

Most zones are in Dubai – namely the DIFC — and in Abu Dhabi, the ADGM. The key aim of the free zones is to allow investors to set up enterprises quickly and easily. Free zones usually offer a fast-tracked system, and many offer assistance with managing UAE bureaucracy, business advice, sector-specific networking and support with new recruitment, sponsorship and housing.

Notable financial incentives include 100% foreign ownership, import/export tax exemptions, corporate tax exemptions, and no personal income tax.

Free zones like the DIFC and ADGM cater specifically to the needs of family offices by offering tailored solutions:

  • Ease of Establishment: Fast-tracked systems and comprehensive support.

  • Tailored Licensing Options: Flexible structures, such as DIFC’s Category 3C licence for managing domestic and foreign investments.

  • Diverse Fund Structures: Options like Public Funds, Exempt Funds, and Qualified Investor Funds accommodate varying capital and regulatory needs.

These benefits streamline operations and provide the flexibility and infrastructure family offices need to scale effectively. “The success of the UAE at attracting family offices dates back to the creation of the Dubai Finance Centre in 2004,” states HSBC Global’s report. “Favourable tax regimes and financial services have fostered an ecosystem that meets family offices’ needs, bolstered further by Abu Dhabi’s hub in 2013.”6

Challenges and opportunities

The UAE – and the GCC as a whole – is a region defined by both modernity and tradition: a place where advanced technology and immense wealth meet long-standing family values. This has created a natural home for a thriving family office sector. Total AUM in the region is forecast to grow by 46% by 2025, yet the concept of family offices remains relatively nascent in the Middle East compared to established hubs like the UK and the US7.

For those thinking of establishing a UAE family office, considering the opportunities and obstacles ahead can be a useful next step.

Opportunities:

  • Generational Wealth Transfer: Nearly $2 trillion is projected to transition to the next generation in the Gulf Cooperation Council region over the next decade. Family offices play a pivotal role in orchestrating this transfer.8

  • Outsourced Investment Offices: A growing opportunity in the Middle East, this model is well-established in other regions.

  • Technology Adoption: Agreus Group highlights that “AI and machine learning are transforming family offices through data-driven decision-making, portfolio optimisation, and predictive analytics.” Younger family members, raised in the digital age, are driving this shift, embracing modern tech to enhance efficiency and accuracy.9

However, challenges remain. Limited data on family office activities, a nascent outsourced chief investment officer (OCIO) market, inflation concerns, and operational issues like staff retention, cybersecurity, and succession planning are key obstacles. Inflation worries are particularly pronounced, with 80% of regional family offices citing concerns compared to 68% globally.10

Addepar arrives in Dubai 

As family offices across the Middle East adapt to an evolving landscape, the demand for sophisticated financial management platforms is growing. Addepar’s platform empowers family offices with timely portfolio insights, optimised decision-making, and enhanced transparency.

Tailored to address complex portfolios involving alternatives and multi-generation interests, Addepar’s solutions help clients navigate inflationary pressures, explore alternative investments, and plan for generational wealth transfer.

With its commitment to cutting-edge financial solutions, Addepar is positioned to support the next generation of family offices in the Middle East. We help clients thrive in one of the world’s most dynamic financial ecosystems.

References

  1. The UAE is evolving into a Family Office Hub, Agreus Group, 2022. 

  2. Doing Business, World Bank Group 2020. 

  3. Global Innovation Index Report, Global Innovation Index, 2022. 

  4. Why the Middle East is seeing a boom in family offices, IQEQ, 2024. 

  5. The Mena Family Office Landscape, HSBC Global, 2024.

  6. The Mena Family Office Landscape, HSBC Global, 2024.

  7. What Does a Family Office in the Middle East Look Like?, Forbes, 2024.

  8. What Does a Family Office in the Middle East Look Like?, Forbes, 2024.

  9. 2024 Family Office Trends Round-up, Agreus Group, 2024.

  10. GCC Family Office Must Adapt, Manage Complex Needs to Succeed, Wealth Briefing, 2023.