As geopolitical tensions and valuation uncertainties rise, Canadian multi-family offices are reconfiguring their portfolios, reducing U.S. exposure and boosting allocations to developed non-U.S. markets, emerging economies, and domestic real estate, signalling a strategic pivot towards diversification and risk management.
In a moment of strategic recalibration, a significant portion of Canada’s multi-family offices are preparing to reduce their exposure to U.S. assets and redeploy capital elsewhere, according to a new Canadian Family Offices report. The Multi-Family Office Landscape in Canada 2025 finds that 44 per cent of multi-family offices (MFOs) expect to decrease allocations to U.S. assets over the next 12 months, and many are eyeing developed non-U.S. markets and select emerging economies for fresh opportunity.
The shift is not simply a reaction to geopolitics. Industry data and market participants point to a mix of valuation, sector dynamics and structural advantages in other jurisdictions. Among MFOs surveyed, 18 per cent said they intended to increase emerging market (EM) exposures over the next 12 months, while more than 40 per cent expected clients’ exposure to non-U.S. developed markets to rise over the same period. The move, advisers say, requires careful country and sector selection rather than a blanket reweighting into low-cost, broad-market funds.
Europe: cautious optimism amid political complexity
Several advisers queried for the report see Europe as a plausible destination for repositioned capital. Michael Zagari of Zagari Wealth Advisory calls Europe “a compelling equity opportunity for 2026, driven by fiscal expansion, reflation, attractive valuations and expected double-digit earnings growth,” and suggests a tactical 10–15 per cent portfolio allocation, overweight in cyclicals such as banks, defence and infrastructure companies.
Simon Jochlin of Stenner Wealth Partners argued for nuance, noting that headline index moves can mask uneven country performance. “If you had invested in the ETF for Poland, it’s up about 65 per cent on an annual basis. If you had purchased the [S&P EURO 100] XEO basket of European economies, Poland is only a one per cent weight,” he said, highlighting fiscal prudence, favourable demographics and industrial strength as drivers in select markets. Jerome Li of the same team singled out France’s large GDP and energy independence, noting “data centres are being built around where the energy is” and that French nuclear capacity and demographics could underpin longer-term investment themes.
Broader market research supports a brighter earnings outlook for the region. According to a report by Allianz Global Investors, European earnings growth is expected to accelerate to around 12 per cent in 2026, narrowing the gap with U.S. corporate performance. Yet advisers warn that political complexity and inconsistent fiscal positioning across member states mean active country selection is essential.
China: opportunity shadowed by policy and geopolitical risk
China remains a polarising prospect. Paul de Sousa of Sightline Wealth Management points to long-term strategic advantages: industrial scale, dominance in solar-panel manufacture, EV battery supply chains and rare earths, along with efforts to internationalise the yuan and reduce dollar dependency. “Chinese equities have traded at a deep discount to U.S. markets due to geopolitical risk premiums. This represents a potential value opportunity for investors who believe in the long-term thesis,” he said.
But others remain cautious. Jochlin warned of opaque data and structural risks that can erode the investible case, stating that asset allocators have been “avoiding China because of that fact.” Still, some managers are maintaining modest allocations; Zagari said his firm has held a five per cent allocation to China and is “favouring hyper-scalers over cyclicals,” reflecting a bet on technology and AI leadership.
Japan and Asia: corporate reform and concentrated thematic plays
Views on Japan are mixed. Jochlin queried Japan’s comparative advantage beyond its legacy industries but acknowledged its recent corporate governance reforms aimed at raising return on equity. Li argued Japan is “resilient” and may see stronger growth under new leadership. Across Asia, advisers highlight India’s favourable demographics and long-run growth potential, but stress active, boots-on-the-ground management to navigate local business practices and policy nuances.
Emerging markets and South America: resources and selective fixed income
South America draws interest primarily through commodity exposures. Jerome Li points to Argentina’s resource base and the theoretical upside if stabilisation reforms succeed, and to a potential Venezuelan recovery should political change occur. Jochlin said investors often prefer targeted bond exposures in emerging markets, with currency-hedged sovereign or corporate debt used to capture returns from resource-driven projects rather than broad equity allocations.
Real estate: a distinct Canadian tilt
The reallocation away from U.S. real assets is tangible. MSCI and other market trackers show Canadian investment into U.S. real estate slowed in 2025, with a notable pivot toward domestic opportunities and other global hubs. Research from MSCI revealed that, while the U.S. remained a major destination for Canadian outbound real estate capital, its share of Canadian capital fell to about 29–30 per cent through the first nine months of 2025, down from a long-term average closer to 56 per cent. Canadian buyers curtailed activity in U.S. residential and commercial markets, a dynamic noted in reporting that cites tariffs, trade tensions and rising construction costs as contributors to a roughly 28 per cent drop in Canadian commercial real estate investment in the latter half of 2024.
That retreat has coincided with renewed interest in domestic Canadian property, where lower rates and a weaker Canadian dollar have made domestic real estate more attractive, and with an outsized allocation to data centres in global outbound real-estate flows. MSCI research shows data centres have represented an outsized share of Canadian outbound capital from 2023 through the third quarter of 2025, reflecting the structural demand for cloud and AI infrastructure.
Practical takeaway for family offices
Advisers in the report converge on a cautious, selective approach: diversify away from concentrated U.S. risk where appropriate, but do so by identifying countries, sectors and companies with clear competitive advantages. “When investing in EMs such as India, boots-on-the-ground active management is worthwhile,” Li said. The overarching message is that diversification is desirable, but that success will depend on granular, active research rather than passive reweighting.
Peter Kenter, the lead author of the Canadian Family Offices piece, frames the shift as part of a broader search for resilience and value in an era of shifting trade relationships and market leadership. For Canadian family offices, the coming year will test whether selective global redeployment can preserve purchasing power while capturing growth beyond U.S. markets.
- https://canadianfamilyoffices.com/special-reports/outlook-2026/outlook-2026-looking-for-investment-opportunities-beyond-america/ – Please view link – unable to able to access data
- https://www.ainvest.com/news/canadian-investors-rebalance-portfolios-real-estate-domestic-resilience-2508/ – Canadian investors, once the largest foreign buyers in U.S. residential and commercial markets, have retreated from American properties due to tariffs, trade tensions, and economic uncertainty. This exodus has reshaped capital flows and catalysed a surge in domestic Canadian real estate demand, creating strategic entry points for long-term wealth preservation. The U.S. imposition of tariffs on Canadian exports has inflated construction costs, eroding the appeal of American real estate. Consequently, Canadian investment in U.S. commercial real estate dropped 28% in the second half of 2024 compared to 2023, with $4 billion in capital deployed—a far cry from the $80 billion injected since 2020. Residential markets mirrored this trend, as Canadian buyers reduced their presence by 26.4% in May 2025. Regions like Florida, Arizona, and Hawaii now face significant drops in transaction volumes. As Canadian investors pivot away from the U.S., domestic real estate has emerged as a compelling alternative. The Bank of Canada’s rate cuts have improved affordability, while the weakened Canadian dollar has made domestic assets more attractive. Regions like Muskoka, Okanagan Valley, and Atlantic Canada’s coastal communities are seeing a surge in demand for recreational and resort properties. This shift is strategic, with Canadian investors capitalising on undervalued domestic markets, where price-per-square-metre ratios in cities like Toronto dwarf those in U.S. counterparts like Los Angeles.
- https://realassets.ipe.com/news/canadian-investment-in-us-real-estate-slows-amid-global-hunt-for-data-centres/10133926.article – Canadian institutional investors have slowed investments in U.S. real estate this year, despite investing US$5.84bn in the market in the first nine months of 2025, according to MSCI data. Although the U.S. continues to be the biggest target of Canadian outbound real estate capital, its share this year has fallen to 29.5%, almost half the long-term average of 56.1% since 2007. Meanwhile, markets including the UK and China/Hong Kong saw their share increase above their long-term averages. Jim Costello, executive director of MSCI Research & Development, cautioned against concluding that the shift was a direct consequence of political upheaval in the U.S., noting that sector allocations are also at play.
- https://knowledge.uli.org/-/media/files/emerging-trends/2026/uli-pwc-emerging-trends-in-real-estate-us-canada-2026.pdf – The report discusses the outlook for U.S. and Canadian real estate markets in 2026, highlighting expectations of muted transaction activity due to higher interest rates and a persistent pricing gap between buyers and sellers. It notes that foreign investment in U.S. real estate has decreased, with Canada and Japan becoming net sellers. The $5 billion reduction in Canadian exposure to U.S. real estate in the first half of 2025, as reported by MSCI Real Assets, supports this view. The report also presents two scenarios: one expecting moderate deployment of sidelined equity investors and another anticipating reduced foreign investment limiting transaction activity.
- https://central.cvca.ca/opinion/multi-family-offices-a-rapidly-evolving-landscape/ – The article discusses the evolving landscape of multi-family offices (MFOs) in Canada, highlighting that 84% of respondents in a survey stated that non-Canadian assets comprise more than 30% of their client portfolios, with nearly 40% indicating that global investments make up more than half. However, more than two in five MFOs intend to reduce allocations to the U.S. over the next 12 months. The article also notes that AI and cybersecurity issues have become significant concerns for family offices, reflecting a growing awareness of cyber risk in 2025.
- https://www.msci.com/research-and-insights/blog-post/real-assets-in-focus-us-still-a-magnet-for-canadian-investors – The blog post highlights that Canadian investors were the second-largest source of cross-border capital for global property markets during the first nine months of 2025, with the U.S. receiving 30% of Canada’s outbound investment. Despite political changes in the U.S., Canadian investors continued to invest, with a particular focus on data centers. The post notes that data centers have represented 40% of all Canadian outbound capital from 2023 through the third quarter of 2025, compared to a 2% share in previous years.
- https://ap.allianzgi.com/en-ap/insights/market-insights/outlook-and-commentary/european-equities-outlook-q3-2025 – The article discusses the outlook for European equities, noting that earnings growth is expected to accelerate significantly to 12% in 2026, supported by an improving macroeconomic environment, diminishing impact of tariffs due to countermeasures, and normalization of currency effects. It also compares this to the U.S., where earnings growth is expected to be 9% in 2025 and 14% in 2026, but with constraints due to the domestic nature of corporate revenues and a below-trend economic growth forecast. The article suggests that the earnings growth gap between the U.S. and Europe is narrowing, challenging the view of ‘U.S. exceptionalism’.
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
10
Notes:
✅ The narrative is based on a press release from Canadian Family Offices, dated December 29, 2025, indicating high freshness.
Quotes check
Score:
10
Notes:
✅ No direct quotes are present in the provided text, suggesting originality.
Source reliability
Score:
8
Notes:
⚠️ The narrative originates from Canadian Family Offices, a reputable organisation. However, the specific report referenced is not widely covered by other reputable outlets, which may raise questions about its broader acceptance.
Plausability check
Score:
9
Notes:
✅ The claims align with recent trends in Canadian family offices, such as reducing U.S. asset exposure and seeking opportunities in non-U.S. developed and emerging markets. ([central.cvca.ca](https://central.cvca.ca/opinion/multi-family-offices-a-rapidly-evolving-landscape/?utm_source=openai))
Overall assessment
Verdict (FAIL, OPEN, PASS): OPEN
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
⚠️ While the narrative is fresh and plausible, it relies solely on a press release from Canadian Family Offices, which is not widely covered by other reputable outlets. This lack of broader coverage raises questions about the report’s acceptance and the accuracy of its claims. Further verification from additional reputable sources is recommended.