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Facility Management Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

  • ID: 4535774
  • Report
  • June 2022
  • Region: Global
  • 120 Pages
  • Mordor Intelligence

FEATURED COMPANIES

  • CBRE Group, Inc.
  • Cushman & Wakefield PLC
  • Emeric Facility Services
  • SMI Facility Services
  • Sodexo, Inc.
The Facility Management Market was valued at USD 567.98 billion in 2021 and is expected to reach USD 762.66 billion in 2027, registering a CAGR of 4.71% over the forecast period (2022-2027).

Key Highlights

  • Facility management consists of multiple factors that influence the productivity and efficiency of organizations. The new management system standard, conforming with the best industry practices, constitutes a benchmark for developing and driving effective strategic, tactical, and operational FM principles across the globe.
  • FM services across Abu Dhabi, Dubai, Sharjah, Ras Al Khaimah, Umm al Quwain, Riyadh, Jeddah, Makkah, and DMA and Ajman have matured. With increasing infrastructure development projects across the GCC for economic growth, allied FM services are also required. Hence, an FM standard that sets apart the industry by adopting the best global practices and policies offers a win-win situation for FM organizations and customers in this country.
  • Services in the FM industry have been commoditized to a huge extent. Also, end-user industries are very price-sensitive, and contracts are thus aimed at shorter terms. Commercial real estate over-supply has been creating pressure on rent yields, thus leading the customers to cut costs on FM services.
  • With the global outlining of real estate owners and developers to optimize their real estate assets, the demand for FM services is on the rise. However, with a lack of skilled workforce and rising hiring costs, the market players engage in partnerships and acquisitions to pool talent and deliver long-term contractual obligations.
  • The outbreak of COVID-19 has had a mixed business impact on facilities management firms. The restrictions on the movement of people resulted in a decline in project work and a decreased level of activity across many customer sites. Significant players in the market studied, such as Mitie, CBRE Group, and others, were adversely affected due to the pandemic lockdown.

Key Market Trends


Integrated Facility Management to Witness Higher Growth Rate

  • Current advantages being made available by property services, such as optimizing individual service components, synchronization of operational services, and the need for improvement in the management of properties, are aiding demand for FM services globally.
  • A study conducted by EmiratedGBC, as of October 2020, outlined that its respondents highlighted the need for benefits for energy efficiency-related projects. These included linking building performance to rental costs, dynamic tariff rates to promote higher building efficiency, green loans or lower interest rates, tax rebates, and grants. This has aided the traditional FM service providers in looking into conservational aspects and led allied energy services players, home/office maintenance companies, and other stakeholders to look at FM services to offer green building practices.
  • For instance, as of November 2020, Fix A Home, a home and office maintenance company, expanded its service portfolio to launch a new service (facilities management service) for the corporate sector. The company attributed such an action due to the increasing scope of facility management services in the Middle East, especially in Dubai. Additionally, the business owners wanted to make the working environment safe, reduce energy costs, and run their business efficiently.
  • Moreover, in January 2022, President Biden's administration launched a new partnership with two states and several cities to reduce building planet-warming emissions. According to a White House fact sheet, the partnership will include 33 state and local governments that encompass 20% of the country's building footprint and 22% of its population. The coalition's goal is to advance legislation or regulation in each local or state jurisdiction by Earth Day 2024. These initiatives also drive the market studied.
  • Back in February 2020, Imdaad, via its commitment to the UAE Vision 2021 National Agenda, launched FARZ, which is an advanced facility of its kind. FARZ was established in line with the company's commitment to contributing to the National Agenda's goals of the UAE Vision 2021, which undertook to divert 75% of all municipal solid waste away from landfills by 2021.
  • Other trends highlighted by EmiratesGBC state that a long-term value of deep retrofit among building owners aims at 50% on-site energy use reduction. Therefore, multiple FM players are looking at deep retrofitting to achieve the net-zero goals, as it would require allied support services to be undertaken.
  • In many countries in the Middle East, including the UAE, the water table dropped by about one meter per year over the past 30 years. Such a continuation of rate is expected to deplete its natural freshwater resources by the next 50 years. It is, therefore, critical for the region to take steps that ensure long-term sustainable water management.


Asia Pacific is Expected to Witness Significant Growth

  • Australia and New Zealand (ANZ) facility management market is witnessing significant growth, and companies need to innovate their offerings to keep growing and remain profitable. However, healthcare, government, and education are the primary sectors likely to drive the studied market.
  • In July 2021, Serco Asia Pacific announced a new integrated facilities management business unit incorporating key FM and asset management services. The formation of the facilities management business unit would provide a platform to enhance existing facility management contracts and broaden capability across Serco’s other five critical sectors of Defence, justice and immigration, health, citizen services, and transport in the region.
  • India’s Metropolitan cities have spread across the north, south, east, and west of the country. Some of the cities are Mumbai, Delhi, Kolkata, Chennai, Bangalore, Hyderabad, and Pune, which have been gaining various investments in real estate for the development of the city in commercial and institutional sectors. Such factors are anticipated to create new opportunities of growth for the studied market in India.
  • However, the growth for FM vendors in the country is slightly offset due to the large presence of unorganized sectors. But with the implementation of the RERA act, in addition to the growing urbanization and the need for modernization, the demand for FM services are expected to continue growing in the country.
  • The pandemic has slightly offset the business investments in South-East Asian countries, like Singapore. For instance, investments in Singapore dropped by 31%, and fixed assets such as machinery, equipment, and facilities shrank to USD 8.78 billion in 2021. However, the country remained above the medium-to-long-term goal of USD 8 to 10 billion, according to the Economic Development Board (EDB) of Singapore. This is expected to improve post-pandemic and drive the demand for FM services.
  • Furthermore, Indonesia is witnessing significant growth prospectus, as various data center vendors are looking to expand their presence in the country. For instance, in April 2021, PT Telkom Indonesia opened a new data center in Ulin, Banjarmasin, Indonesia. It inaugurated the Neutral Cloud & Internet Exchange (neuCentrIX) data center. The Tier II facility has a capacity of 29 racks, and the company hopes to accommodate government, internet service providers, and start-up customers. Continuous investments in data centers is anticipated to drive the growth of the studied market in the country.


Competitive Landscape


The Facility Management Market is highly fragmented, with both local and international players having decades of industry experience. ​The FM vendors are incorporating a powerful competitive strategy by leveraging their expertise. Also, they are spending a large chunk of the amount on advertising.​ The FM companies are incorporating technologies into their services, which are adding strength to their service portfolio.
  • February 2022 - Farnek, an innovative and green facilities management (FM) firm based in the United Arab Emirates, created a new smart FM technology solutions company. The HITEK solution 4.0, developed in-house, was initially launched in Q3 last year, connecting people, assets, and spaces from multiple remote sites, using intelligent analytical platforms for cleaning, security, and maintenance, so they could be smartly centrally managed and monitored by leveraging the Internet of Things (IoT), Building Management Systems (BMS), Cloud, Machine Learning (ML), and Artificial Intelligence (AI) based technologies.
  • September 2021 - Disrupt-X, a Dubai-based IoT development company, has announced a collaboration with Imdaad, a Dubai-based group of companies that provides integrated, sustainable Facilities Management (FM) services that improve operational efficiencies of physical assets, to introduce IoT technology to enhance FM services in the United Arab Emirates.

Additional Benefits:

  • The market estimate (ME) sheet in Excel format
  • 3 months of analyst support


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Note: Product cover images may vary from those shown

FEATURED COMPANIES

  • CBRE Group, Inc.
  • Cushman & Wakefield PLC
  • Emeric Facility Services
  • SMI Facility Services
  • Sodexo, Inc.

1 INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2 RESEARCH METHODOLOGY3 EXECUTIVE SUMMARY
4 MARKET INSIGHTS
4.1 Market Overview
4.2 Industry Attractiveness-Porter's Five Forces Analysis
4.2.1 Bargaining Power of Suppliers
4.2.2 Bargaining Power of Buyers
4.2.3 Threat of New Entrants
4.2.4 Threat of Substitute Products
4.2.5 Intensity of Competitive Rivalry
4.3 Impact of COVID-19 on the Facility Management Industry
5 MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Increasing Investments in Healthcare Infrastructure and the Construction of Healthcare Facilities
5.1.2 Requirement of Building Information Modeling (BIM) in Commercial Buildings Addresses the Growth
5.2 Market Restraints
5.2.1 Increased instances of Data Breaches and Security Threats
6 MARKET SEGMENTATION
6.1 By Type of Facility Management Type
6.1.1 In-house Facility Management
6.1.2 Outsourced Facility Mangement
6.1.2.1 Single FM
6.1.2.2 Bundled FM
6.1.2.3 Integrated FM
6.2 By Offerings
6.2.1 Hard FM
6.2.2 Soft FM
6.3 By End-Users
6.3.1 Commercial
6.3.2 Institutional
6.3.3 Public/Infrastructure
6.3.4 Industrial
6.3.5 Others
6.4 By Geography
6.4.1 North America
6.4.1.1 United States
6.4.1.2 Canada
6.4.2 Europe
6.4.2.1 United Kingdom
6.4.2.2 Germany
6.4.2.3 France
6.4.2.4 Rest of Europe
6.4.3 Asia Pacific
6.4.3.1 China
6.4.3.2 Japan
6.4.3.3 India
6.4.3.4 South Korea
6.4.3.5 Rest of Asia Pacific
6.4.4 Latin America
6.4.4.1 Brazil
6.4.4.2 Mexico
6.4.5 Middle East and Africa
6.4.5.1 Qatar
6.4.5.2 Saudi Arabia
6.4.5.3 United Arab Emirated
6.4.5.4 South Africa
6.4.5.5 Egypt
7 COMPETITIVE LANDSCAPE
7.1 Company Profiles
7.1.1 CBRE Group, Inc.
7.1.2 Jones Lang LaSalle Incorporated
7.1.3 Cushman & Wakefield PLC
7.1.4 Emeric Facility Services
7.1.5 SMI Facility Services
7.1.6 Sodexo, Inc.
7.1.7 AHI Facility Services, Inc.
7.1.8 ISS Facility Services, Inc.
7.1.9 Shine Management & Facility Services
7.1.10 Guardian Service Industries, Inc.
8 INVESTMENT ANALYSIS9 FUTURE TRENDS
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A selection of companies mentioned in this report includes:

  • CBRE Group, Inc.
  • Jones Lang LaSalle Incorporated
  • Cushman & Wakefield PLC
  • Emeric Facility Services
  • SMI Facility Services
  • Sodexo, Inc.
  • AHI Facility Services, Inc.
  • ISS Facility Services, Inc.
  • Shine Management & Facility Services
  • Guardian Service Industries, Inc.
Note: Product cover images may vary from those shown

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