Copyright scmp
Five local family offices will jointly launch a US$100 million fund on Thursday to capture the new business opportunities arising from the government’s newly launched Family Office 2.0 plan, aimed at attracting more wealthy international individuals to invest in Hong Kong. Inspira is a closed-end fund focused on private credit and other stable-income projects. It targets affluent families, particularly those interested in applying for residency in the city through the Capital Investment Entrant Scheme (CIES), according to Cliff Ip Wang-hoi, a partner at Wings Capital, one of the five family offices establishing the fund. “With the government’s announcement of the Family Office 2.0 plan to further promote [the sector] in Hong Kong over the next three years, we believe the business opportunities arising from the increasing investment demand from global wealthy families will be huge,” Ip said ahead of the launch. “As we have been running family offices in Hong Kong for a long time, we understand the demands and concerns of other wealthy families. This is why we decided to launch a fund [aimed at] other family offices,” he said. Family offices are entities created by affluent individuals or families to manage their investments, succession planning and philanthropic activities. In his policy address last month, Chief Executive John Lee Ka-chiu set a new target of attracting an additional 220 family offices to Hong Kong by 2028, after achieving the previous goal of bringing in 200 such firms between 2023 and 2025. After attracting many wealthy mainland Chinese families during the initial phase of the development of the family office sector, Hong Kong now aimed to draw high-net-worth individuals from Europe, Asia and the Middle East to establish family offices in the city, said Jason Fong, global head of family office at InvestHK, a government agency focused on attracting investment, earlier this month. Ip, who took part in InvestHK’s European tour last month, observed strong interest among European families in using Hong Kong as a platform for investing in Asia. “Many wealthy families like to diversify their investments, and many of them view the economic growth in this region positively,” he said, adding that their arrival would significantly boost capital inflow into the city. Wealthy families preferred investment products that delivered stable income without excessive risk, making private credit a good option, said Anthony Leung, partner and chief investment officer of Archbridge Capital Partners, the investment manager for Inspira. “Private credit consists of loans made by private investors, with borrowers providing collateral,” Leung said. “This offers a much better return than bank deposits or some fixed income products, while the collateral mitigates risks so family offices need not worry about losing all their money.” The five family offices have also invested their own capital into the fund, a strategy that Leung believed would instil confidence in other investors. “This shows we are confident in the projects we are investing in through Inspira alongside other family offices,” he said. Inspira qualified as an investment under the CIES, Hong Kong’s cash-for-residency scheme, according to Ip. Introduced in March last year, the CIES provides applicants and their families a fast track to residency by investing HK$30 million (US$3.8 million) in funds, stocks, bonds or certain property. Official figures indicated that as of April, authorised funds and equities accounted for 64.5 per cent of the HK$16.5 billion in investments verified under the scheme. Many CIES applicants were interested in setting up family offices in Hong Kong as their investment vehicles, further promoting the sector, Ip said.
