In 2025, ultra-high-net-worth families navigated a year defined by policy uncertainty, market volatility, and an intensified focus on after-tax outcomes.
Tom Bratkovich, chief investment officer at DCA Family Office, tells InvestmentNews that these dynamics pushed families further toward private markets, real assets, and highly intentional portfolio construction.
On the major themes shaped that UHNW families’ investment decisions in 2025, Bratkovich points first to uncertainty early in the year.
“Shifting tariff policies injected real uncertainty into capital allocation decisions, pushing many UHNW families to favor control, visibility, and downside protection,” he says. That environment accelerated what he describes as “an already powerful move into private markets, particularly private equity, private credit, energy transition assets, and AI-driven digital infrastructure, where cash flow, structural protections, and secular demand are clearer.”
Liquidity engineering also became more sophisticated. “Secondaries and continuation vehicles became mainstream tools to engineer liquidity without sacrificing long-term private-market exposure,” Bratkovich notes. “Families are increasingly looking to deploy capital where they can generate both attractive returns and meaningful tax advantages, which can unlock more investable capital and enhance financial returns, and the 2025 tax legislation reinforced tools to achieve these goals.”
Private markets were not just a theme this year, they were a central pillar, so how did private markets factor into family office allocations this year?
“Private markets continued to play a central role in family office allocations, growing from 46% to 54% from 2020 to 2025, according to UBS Family Office Report,” Bratkovich says, emphasizing that “direct investments in real estate, infrastructure, and private equity allowed families to diversify away from public market volatility while accessing return streams that are often more predictable and tax efficient.”
For families focused on longevity, he adds, “private markets offer a way to structure investments that align with both performance and long-term wealth preservation goals.”
Within those allocations, real assets stood out, but what types of real assets were most in demand in 2025?
Bratkovich observed “strong demand for high-quality, income-generating real assets, particularly in sectors that offer structural growth and inflation protection.” He highlights “industrial real estate including data centers, permanent crops, trophy-level hospitality, digital infrastructure and energy, and various alternative yield niche assets,” noting that many families were “leveraging bonus depreciation and 1031 exchange strategies to enhance after-tax returns.”
Rather than choosing between markets, families increasingly treated them as complementary. How are UHNW families balancing public vs. private market exposure?
“Families are increasingly viewing public and private markets as complementary,” Bratkovich explains. “Public equities provide liquidity and flexibility, while private markets allow for diversification, tailored exposure, higher return potential, longer-term compounding, family engagement, and tax-efficiency.” The result, he says, is a conscious reweighting: “Many families are consciously shifting a larger portion of their portfolio into private markets to achieve stickier returns and capture more effective after-tax benefits.”
Tax strategy itself has become inseparable from investment strategy. What tax-efficient strategies are gaining the most traction for long-term planning?
“Strategies like 1031 exchanges, bonus depreciation on real assets, and Opportunity Zone investments continue to gain traction especially with the passage of the OBBB,” Bratkovich says. Families are also “looking at structuring private equity investments in ways that maximize deferred taxation and optimize after-tax returns.” He underscores the compounding effect: “These approaches allow capital to compound more effectively over time while aligning with legacy and multigenerational planning goals.”
He is also clear-eyed about trade-offs: “Conversely, private credit, which has been in vogue for a couple years now, is not tax efficient due to the makeup of the returns being concentrated in annual yield exposed to ordinary income tax rates,” Bratkovich notes. As a result, “to get similar exposure, we have focused on alternative-yield real assets that deliver private-credit-like income with hard-asset collateral and more tax-efficient structuring than traditional lending.”
That long-term lens naturally extends to family dynamics. How are families addressing multi-generational wealth needs today?
“Families are increasingly focused on structures that support long-term wealth transfer while minimizing friction across generations,” Bratkovich says. He points to “tax-efficient private market strategies, family trusts, and other bespoke planning tools” that “allow capital to grow sustainably and be deployed strategically for future generations.”
Just as important, he adds, is alignment: “Education and alignment across family members are also critical… Getting multiple generations involved early can help inevitable transitions become seamless, maintaining focus on the long-term objective set out.”
Risk management remains front and center as families look ahead. What risks are UHNW investors most focused on heading into 2026?
Bratkovich lists “market volatility, interest rate shifts, geopolitical uncertainty, and potential tax policy changes” as top concerns. Many families, he says, are responding by “increasing diversification through private market allocations, real assets, and structured tax-advantaged strategies that reduce downside while preserving upside potential.”
Policy timing is also influencing near-term decisions, but are families adjusting portfolios in anticipation of policy or tax changes next year?
“Investors are reviewing the timing of 1031 exchanges, accelerating bonus depreciation where appropriate, and positioning portfolios to take advantage of the next-generation Opportunity Zone program resetting in 2027,” Bratkovich explains, framing these moves as part of “a broader effort to maximize after-tax efficiency.”
Against this backdrop, opportunity remains with select real estate opportunities, private equity, niche infrastructure / alternative yield assets among the most compelling right now, according to Bratkovich.
He emphasizes that these strategies “not only offer attractive risk-adjusted returns but also allow families to leverage tax-efficient structures that enhance overall portfolio performance.” Ultimately, he concludes, “private markets continue to provide avenues for both growth and tax-optimized wealth preservation.”
All of this reflects a broader shift in the function of the family office itself. How has the role evolved as markets become more complex?
“Family offices have evolved well beyond traditional asset management, becoming more proactive, strategic, and institutionally sophisticated as markets grow more complex,” Bratkovich says. Today, many “integrate governance, estate and tax planning, investment sourcing and underwriting, and multi-generational wealth strategy under one coordinated framework.”
At the center of that evolution is what he calls “a tax-efficient private markets approach,” which enables family offices “to act not just as capital allocators but as long-term stewards, aligning investment performance, after-tax outcomes, and legacy planning in a cohesive way.”
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