Family offices are faster adopters of artificial intelligence than other institutional investors, according to the new Schroders Global Investor Insights Survey of pension funds, insurance companies, family offices, endowments, foundations and other wealth institutions.
The survey found that 47% of family offices have started using AI to improve decision-making and internal processes. That marks a higher adoption rate than the survey’s overall findings, in which 34% of respondents say they’re using AI for internal operational efficiency and 31% for investment research and analysis.
Out of the 2,830 survey respondents, 14% represented family offices, with 67% of them expressing a positive outlook on using AI for investment research and portfolio construction.
Bruce K. Lee, CEO of the multi-family office Keebeck Wealth Management, told Crain Currency that his firm uses the Microsoft Copilot chatbot and Qdeck and in the future intend to present clients with AI-generated data regarding their portfolios and potential investments.
“We’ve noticed a pattern that clients don’t look at their portfolios, but we do,” Lee said. “We want to have an instrument that gives us a warning that our clients are looking at their portfolios and then allows us to help them direct traffic. We still want to be the adviser; we just want to be more connected through technology.”
While family offices adopt AI internally, the technology is also affecting their investment outlooks in real estate. Lee said he is “infinitely bearish on office space,” given work-from-home trends and potential labor reductions triggered by AI. For example, Lee sees AI-driven job cuts hitting the riverfront area around his Keebeck office in Chicago.
“When you look at all those buildings down Michigan Avenue, about 15 years ago I’d say that’s gold," he said. "Now I think you could convert all those buildings into a huge skate park, because I think lawyers are primarily the big employer of these buildings, and lawyers are admitting they don’t need as much space. They don’t need as many attorneys because ChatGPT is going to help them come up with those outcomes.
"So you’re gonna have less attorneys and more billable fees for far more productivity. Which means instead of 12 floors, you’re only going to need six.”