The Cayman Islands are an increasingly appealing jurisdiction for the establishment and operation of single family offices.
The Cayman Islands are an increasingly appealing jurisdiction for the establishment and operation of single family offices. This is, in a sense, a natural evolution and development of the financial services activities for which the Cayman Islands is well known. Many of the businesses that grew to service the investment funds, banking, finance and insurance sectors require experienced staff and technical expertise that is consequently available in the Islands and readily transferable into a family office environment, where the focus is on the preservation and management of family assets rather than external investors’ interests.
There are few places outside the major onshore financial centres which can offer the talent pool, professional services support, fiduciary/custodial mindset, transactional expertise and connectivity which is available in and provided by the Cayman Islands. Single family offices of many shapes and sizes, therefore, have come to be based in the Islands but the most prominent by some margin is the Dart Family Office, which has made the Cayman Islands its home since the 1990s and has played a significant role in the development of Cayman more recently.
Having a large and sophisticated family office such as Dart in the Islands is a major endorsement of the factors that make Cayman so appealing for family offices generally and, as the community of single family offices in the Island grows, there will be growing opportunities for these family offices to work together, co-invest, and to attract larger and ever more interesting investment opportunities.
Unsurprisingly, the cosmopolitan nature of the Cayman Islands generally is reflected in the international makeup of the single family offices, which are based here, with offices representing families from the US and Canada, the Caribbean, Latin America, Europe and Africa, particularly, and interest from the Middle East and Asia increasing of late. As well as being based in the Cayman Islands themselves, many single family offices employ Cayman Islands companies, limited partnerships or trusts to structure the acquisition and holding of assets or to participate in the international transactions in which they engage in order to preserve and enhance the wealth of the family which they serve. In this respect, the Cayman Islands provide solutions to the single family office at a number of different levels.
With over 135 nationalities represented in the Cayman Islands, it is no surprise that the Islands are proving of increased interest to UHNW individuals and families from all regions of the globe. The factors that make the Cayman Islands appealing for international business transactions and investment and asset holding structures, also make it appealing to the individual: the rule of law applies to all without bias, including the government; the judicial system is competent, fair and transparent and the Islands are politically and financially stable (reinforced by its connections to the United Kingdom as a British Overseas Territory); the Islands also boast an excellent communications network. In addition to this, inhabitants of the Cayman Islands enjoy a considerably higher standard of living than anywhere else in the Caribbean (if not the world). Most importantly, the Cayman Islands are extremely safe with a low crime rate and no instances of the type of antisocial and threatening behaviour which affects other places where the wealthy tend to congregate. Cayman is a society that is friendly, inclusive, cosmopolitan and respectful of the individual, so much so that the term “Caymankind” has been coined recently to reflect the particular qualities of Cayman society. With an expected increase in the population of the Islands and the arrival of new permanent residents from all regions and walks of life, we can expect increased diversification within the population over the coming years, increased interest from wealthy families and increasingly diverse activity on Island.