On October 20, Bank of America Private Bank released its 2026 Family Office Study, a survey of 355 U.S. family office decision makers. One finding stands out for anyone raising equity for property. Private equity ranked first among the opportunities the offices see for building wealth, cited by 51 percent, while 38 percent pointed to direct ownership stakes, according to the bank's release. Raising capital from family offices now means meeting allocators who want to sit closer to the deal. That changes how a sponsor plans a raise under Rule 506 of Regulation D.
The sponsors best placed for that capital settle three questions before the first meeting. They decide which offering rule governs the approach. They confirm how the family office qualifies as an accredited investor and how it will be verified. They also work out what a direct allocator, often investing beside other families, will expect in structure and reporting. Each answer sits in the SEC's rules rather than in a pitch deck, and our guide to accredited investor verification under 506(c) covers the verification side in depth.
What the Study Says About Family Office Real Estate Investors
Alternatives Watch, reporting on the full study on October 20, said 47 percent of the offices plan to increase private real estate exposure over the next one to three years. Private real estate makes up 18.6 percent of the average alternatives allocation, the report said. The offices hold 40.6 percent of their alternatives directly rather than through funds, and 86 percent consider relationships with other family offices important for finding investments. These are survey answers about intentions, reported by the offices themselves. They say nothing about how any property will perform or which sponsor will be chosen.
The detail behind the numbers matters more than the headline. One chief executive of an office managing $1 billion to $5 billion told the researchers that the office wanted to team up with other family offices on private credit and direct real estate deals, according to Alternatives Watch. An allocator that invests directly behaves less like a fund subscriber and more like a partner. It examines the property itself, questions the sponsor's controls and track record, and may bring other families into the same deal. Each of those habits has a regulatory consequence for the sponsor.
Raising Capital from Family Offices Starts With Rule 506(b) or 506(c)
The first decision is the offering rule, because it governs how the sponsor may make contact. Under Rule 506(b), the SEC says there may be no general solicitation or advertising to market the securities. Outreach to family offices therefore generally runs through relationships the sponsor already has. That suits a sponsor whose network already includes the families it wants to reach. The rule also allows sales to up to 35 investors who are not accredited in any 90 calendar day period, although a large family office will rarely depend on that allowance.
Rule 506(c) permits general solicitation. A sponsor can present a deal at a family office conference or write to an office it has never met. In exchange, every purchaser must be an accredited investor, and the sponsor must take reasonable steps to verify that status. The choice shapes the whole campaign, and our comparison of how real estate sponsors choose between 506(b) and 506(c) sets out what each rule allows. Family offices based outside the United States follow a separate track under Regulation S, explained in our Regulation S guide to raising capital from international investors.
How a Family Office Qualifies as an Accredited Investor
Family offices became a named category of accredited investor through amendments the SEC adopted on August 26, 2020. Under Rule 501(a)(12) of Regulation D, a family office qualifies when it has more than $5 million in assets under management. It must not have been formed for the specific purpose of acquiring the securities offered. A person with enough knowledge and experience in financial and business matters to evaluate the merits and risks of the investment must direct it. The term family office takes its meaning from Rule 202(a)(11)(G)-1 under the Investment Advisers Act of 1940.
Rule 501(a)(13) adds the office's family clients. A trust or holding company belonging to the family can therefore qualify when the office directs its investment. This matters because the entity that signs the subscription documents is often not the office itself. A sponsor should identify which entity will invest and which paragraph of Rule 501(a) it relies on. An entity with more than $5 million in total assets under Rule 501(a)(3), or more than $5 million in investments under Rule 501(a)(9), meets a different test with different evidence.
Verifying a Family Office in a 506(c) Raise
Verification is where family office raises often slow down. Wealthy families guard their privacy and resist sending financial statements to a sponsor they barely know. The SEC set the baseline in its 2013 adopting release for Rule 506(c). It said an issuer has not taken reasonable steps if it required only that a person check a box in a questionnaire or sign a form, absent other information. The same release said the steps for an entity will necessarily differ from those for a natural person, and that a purchaser's ability to meet a high minimum investment amount could be a relevant factor.
An SEC staff letter of March 12, 2025 built on that point. In the circumstances it described, the SEC staff accepted reliance on a high minimum investment amount combined with written representations. The legal entities it covered include family offices relying on Rule 501(a)(12). The purchaser states in writing that it is accredited and that its investment is not financed in whole or in part by a third party for that particular investment. The letter is staff guidance rather than a rule change. Securities counsel should decide whether a deal fits its conditions or whether a letter from the family's CPA or attorney is the sounder route.
What Direct and Coinvesting Family Offices Expect
Once eligibility is settled, the conversation turns to structure. Here the study's emphasis on direct deals carries the most practical weight. An office that invests directly often asks for more than a fund investor receives, such as reporting on each property, notice of major decisions and access to the sponsor's team. When several offices invest together, a sponsor may be asked to form a separate vehicle for the group. It may also be asked to agree side letters, which are individual agreements that give one investor terms or information beyond the main documents.
Each of these requests raises a disclosure question. The private placement memorandum and the operating agreement must describe what every investor receives and the risks they share. Those risks include loss of capital, illiquidity, leverage, falling property values, tenants leaving and distributions not being paid. A family office with a long horizon bears all of them. A sponsor that writes its terms for reporting, side letters and group vehicles before the raise keeps one set of records and treats its investors consistently.
What Sponsors Can Do Before Approaching Family Offices
You can start by choosing the offering rule for the next deal and recording why. Every conference appearance, email and introduction should then match it. Next, map each family office prospect to the entity that will invest and the paragraph of Rule 501(a) that entity relies on. Agree the verification method with counsel before the first meeting. Finally, prepare a standard reporting package and a short written policy on side letters and group vehicles, so the first diligence questions already have answers.
Raveum offers sponsors an investment management platform, fund administration, a global raise track under Regulation S and an operating partnership for selected sponsors. U.S. investors come in under Rule 506(c) and receive K-1s, and sponsors keep their investor relationships, their property and their business plan. See how the Raveum Sponsor Program works.
Preparation Is What Family Office Capital Rewards
The Bank of America survey describes families that want to own assets more directly and to invest alongside one another. Nothing in it suggests they will relax their standards to do so. Read that way, raising capital from family offices depends less on the right introduction than on preparation. The sponsor arrives with the offering rule chosen, each investor's accredited status mapped and the reporting terms written down. Those are compliance decisions as much as marketing ones, and our guide to 506(c) accredited investor verification explains the verification work in detail. A sponsor that settles them early meets a direct allocator on terms that allocator already recognizes.
Frequently Asked Questions
Is a Family Office an Accredited Investor
A family office is an accredited investor under Rule 501(a)(12) of Regulation D when it has more than $5 million in assets under management, was not formed to acquire the securities offered, and is directed by a person with enough financial and business experience to judge the investment's merits and risks. The SEC added this category in amendments adopted on August 26, 2020.
Do Family Offices Invest in Real Estate
Many do, and the 2026 Bank of America Family Office Study suggests interest is growing. According to Alternatives Watch, 47 percent of the 355 U.S. offices surveyed plan to increase private real estate exposure over the next one to three years. The survey records intentions rather than results, so it says nothing about how any property or sponsor will perform.
How Do You Verify a Family Office in a 506(c) Offering
You take reasonable steps based on the facts, and the SEC said in 2013 that a checked box alone is not enough. Common routes include examining documents that show the office's assets under management, or obtaining a letter from its CPA or attorney. Where counsel agrees the conditions are met, a sponsor may follow the approach in the SEC staff letter of March 12, 2025.
Can a Sponsor Approach a Family Office Under Rule 506(b)
Yes, as long as the approach is not general solicitation. Rule 506(b) bars general solicitation and advertising, so outreach generally runs through relationships the sponsor already has rather than public events or cold messages to strangers. A sponsor that wants to present at open conferences or contact offices it has never met should consider Rule 506(c), which permits general solicitation with verification.
What Is a Family Office Coinvestment
It is a deal in which a family office invests alongside a sponsor or other investors in a specific property, rather than committing to a fund that has not yet chosen its assets. Coinvestment often involves a separate vehicle, extra reporting rights or side letters, and each of those terms must be consistent with the offering documents every investor receives.
When Should a Sponsor Bring In Securities Counsel for a Family Office Raise
Before the first outreach. Counsel should confirm the offering rule, the accredited investor category each investing entity relies on and the verification method, and should check the terms of any side letter or group vehicle before signing. Family office investors still face loss of capital, illiquidity and leverage risk, and the offering documents must disclose those risks to every investor.
This article is for general education only and is not legal, tax or investment advice. Securities and tax rules change and depend on each sponsor's facts, so work with qualified securities counsel and tax advisors before launching an offering. Real estate investments involve risk, including loss of capital, illiquidity and changes in property values. Offerings on Raveum are available to eligible investors only and are not open to the general public.
