Strategic Asset Allocation for a Diverse Family Office

As a senior investment advisor, you are tasked with developing a comprehensive Strategic Asset Allocation (SAA) model for a family office managing a diverse portfolio of assets valued at $20 million. The family office has multiple objectives, including capital preservation, tax minimization, and sustainable growth, with a focus on socially responsible investing (SRI). The family members span three generations, with varying investment horizons and liquidity needs.

The family has indicated a preference for an allocation strategy that balances traditional asset classes (equities and fixed income) with alternative investments such as private equity, real estate, and impact investments, aiming for a total expected return of 6% with a risk tolerance between moderate and high.

Considering the family's objectives, constraints, and current investment market conditions, outline your SAA recommendations. Discuss the rationale behind your asset class weightings, risk assessment process, and considerations for managing liquidity and tax impacts. Further, address how you would incorporate SRI into your allocations and evaluate the potential trade-offs and barriers associated with these investments.