A Generational Shift is Set to Reshape Property Strategy.

Australia is entering a period of substantial intergenerational wealth transfer. JBWere estimates that around $5.4 trillion will move between generations over the next 20
years, reshaping not only who holds capital, but how investment decisions are made, governed and executed. As this transfer gathers pace, long-established property
strategies are being reassessed. The good news is that property investment remains central to private portfolios.

Knight Frank research shows that 31 per cent of Australian family offices plan to increase their allocation to direct real estate over the next 18 months. However, where
previous generations often prioritised accumulation and capital growth, families are now placing greater emphasis on stability, diversification and geographic risk management, particularly as decision-making expands to include multiple generations.

This shift reflects a broader recalibration of risk appetite. Rather than concentrating exposure within a small number of assets or markets, families are increasingly focused
on constructing portfolios that can perform consistently across different economic environments.

Property’s ability to deliver income, capital preservation and inflation protection continues to underpin its appeal in this context. While investment decisions were historically tightly held, governance structures are also evolving. Today, 58% of family offices are actively involving the next generation in decision-making, with 40% reporting that this involvement has already resulted in a change in investment strategy. This earlier engagement is driving more transparent processes, clearer investment frameworks and a stronger emphasis on long-term outcomes rather than short-term performance.

From Growth to Balance

One of the most consistent themes emerging across private offices is the need to balance long-term wealth preservation with liquidity demands. Property has long been
valued for its durability, but in a more complex investment environment shaped by tax considerations, interest-rate cycles and evolving family goals, flexibility has become just as important as performance. Families are becoming more conscious of how capital is tied up, how assets can be repositioned over time and how portfolios can respond to life events, succession planning and changing income needs.

This is driving a reset in property strategy. Rather than pursuing growth in isolation, families are prioritising assets that deliver stable income, diversified risk and the ability to adapt over time. Assets with predictable cash flows and strong fundamentals are being favoured for their capacity to preserve capital while maintaining liquidity and
optionality.

This shift is being reinforced, rather than challenged, by younger decision-makers. Knight Frank’s Next Generation Survey shows that affluent investors aged 18–35 remain drawn to the traditional trio of stocks, property and cash across income levels. While their approach may be more data-driven and hands-on, their asset preferences suggest continuity as opposed to disruption, reinforcing property’s role as a core, long-term holding.

Why Trusted Advice Still Matters Most

The next generation of wealthy Australians brings strengths many of their predecessors did not, including greater financial literacy, comfort with data and technology, and a more active approach to portfolio management. At the same time, they are operating in a far more intricate environment, where tax, regulation, market cycles and family
governance increasingly intersect.

In this context, the role of trusted advice has evolved. Australian family offices accounted for 40% of private capital investment transactions in 2024, up from just 10% in 2020, reflecting a growing desire to influence outcomes directly rather than remain passive.

Private offices are no longer solely focused on identifying opportunities or executing transactions; they are increasingly co-investing alongside funds, driving development projects, and taking stakes in emerging alternative real estate sectors. The expansion of private office portfolios is also enabling access to larger, more complex transactions that were once the domain of institutional investors alone.

A More Deliberate Era for Private Property Capital

As capital transitions between generations, property strategy is becoming more deliberate and more closely aligned with long-term objectives. The focus is shifting away from growth for the sake of growth and toward resilience and adaptability.

Property’s enduring relevance lies in its ability to meet these evolving needs providing income stability alongside flexibility in terms of portfolios. For families navigating this generational shift, the combination of disciplined strategy and trusted advice will be critical in ensuring property continues to play a central role in preserving and growing wealth over the decades ahead.