Emergency services are still hunting for Richard Chapelow, who was reportedly thrown from the boat on the Santa Clara Dam at about 5pm on Monday.
He was a guest of property tycoon Jon Hunt, the founder of the Foxtons estate agency, who owns property in the area, a spokesman for Mr Hunt said.
Mr Chapelow was part of a group of 10 Britons at the popular watersports and fishing spot, about an hour’s drive north of the Algarve region, local media reported.
A statement issued on behalf of the Hunt family said: “My family and I are devastated by the loss of Richard, following a tragic accident at Santa Clara Dam.
“Our thoughts and prayers are wholly with Richard’s family, and we ask that both families are given space to grieve such a painful loss.
“We will be working closely with the Portuguese authorities to understand what has happened, and are grateful to the local police and fire services for their efforts.
“It is a time of great sorrow.”
Local volunteer fire chief Mario Batista told Portuguese media four people were on a banana boat with another six on a boat towing the inflatable.
One rider disappeared after all four were thrown from the float, he said.
A foreign office spokeswoman said: “We are assisting the family of a British man reported missing in Portugal and are in contact with the local authorities.”
The man’s family have been informed, the spokeswoman added.