Facility Management Market Size, Share & COVID-19 Impact Analysis, By Service Type (Hard Services, Soft Services, and Others Services), By Industry (Healthcare, Government, Education, Military & Defense, Real Estate and Others) and Regional Forecast, 2021-2028

The global facility management market size was USD 1,234.55 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with facility management witnessing a negative impact on demand across all regions amid the pandemic. Based on our analysis, the global market exhibited a lower growth of -0.2% in 2020 as compared to the average year-on-year growth during 2017-2019. The market is projected to grow from USD 1,249.45 billion in 2021 to USD 1,759.25 billion in 2028 at a CAGR of 5.0% during the 2021-2028 period. The rise in CAGR is attributable to this market’s demand and growth returning to pre-pandemic levels once the pandemic is over.

The facility management industry, defined as the means of providing maintenance support, user management, and project management, has grown dramatically over the past two decades owing to the continuous growth in urbanization and industrialization.

The demand for facility management solutions and services has risen in the past few years and is expected to grow significantly over the forecast period. The rising demand is attributable to the increasing investments by governments in industries such as transport, energy, construction, and others. Moreover, this type of management service providers offer their services by contracting with the building management. The contract management includes workforce, equipment, and other services.

Adoption of Facility Management Services by Governments to Surge Post COVID-19 Pandemic

The COVID-19 pandemic has resulted in economic turmoil owing to subsequent lockdowns. It has also impacted the facility management industry. Contrary to this, the increasing awareness of cleanliness, maintenance management, and security is expected to drive the market in the coming future. Furthermore, governments in the worst-affected countries, such as Spain, Italy, the U.S., China, and the U.K., are investing in these services to make the containment zones COVID-free. Moreover, the service providers are focused on offering end-to-end facilities management services to businesses and government sectors, allowing them to work efficiently in restricted areas. Hence, the contribution of these service providers during the pandemic will boost the government-initiated schemes for combating the virus across the world.

LATEST TRENDS

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Investments in Tourism Industry by Governments of Several Countries is a Vital Trend

Currently, governments of developed and developing countries are constantly working on their economic diversifications by investing in their tourism as well as other industry verticals. Over the past few years, governments across several countries have invested heavily in diversifying their non-economic sectors. Moreover, several countries have taken initiatives to unlock their tourism sector by implementing multiple significant changes. For instance, in the Kingdom of Saudi Arabia, the government started issuing tourist visas for the first time in 2019, which is considered to be the most important change that has taken place.

Such investments from governments and private sectors will drive the market in the country in the coming years.   

DRIVING FACTORS

Growth in the Infrastructure Sector to Boost the Facility Management Market Growth

Governments across several countries are focused on investing in infrastructure. They have started investing heavily in the construction of railways, ports, airports, and various other sectors. For this, there have been numerous collaborations with multiple private contractors including service providers that help in keeping the infrastructure clean and green. Moreover, governments are signing contracts with several international players to complete and link their infrastructure internally and across the borders as well as.

For instance, over the next 11 years, the government of Saudi Arabia has raised USD 36 billion (~135 Billion Riyals) for transportation infrastructure. This initiative is mainly focused on railways, airports, ports, and roads. This investment is funded by the government and several private companies. According to the Ministry of Energy, Saudi Arabia, the country has planned to invest USD 425 billion (~1.6 Trillion Riyals) over the next ten years in its infrastructure and industrial programs. This private sector investment is dedicated to the Saudi Crown Prince Mohammed bin Salman’s Vision 2030 program.

Therefore, the growth of the infrastructure sector in several countries is expected to drive the market. Moreover, service providers across the world have ample opportunities for seeking contracts from private sectors.

RESTRAINING FACTORS

Lack of Stable Contracts, Limited Use of Technology, and Lack of Capabilities and Resources to Hamper Growth

Several large enterprises with huge investment amounts usually do not face such challenges as these companies take contracts for a long period. Moreover, large enterprises mostly integrate innovative technologies to provide hard and soft services, which allow such companies to provide better and enhanced services. On the other hand, small and medium-sized companies face such challenges frequently, owing to the lack of financial resources and funding in the country.

Additionally, the rapid growth in the infrastructure sector is demanding more workforces, which is affecting domestic facilities management across the country. These are the primary factors that are impacting the growth of this market. However, to resolve such issues, the workforce and controlling costs will play a vital role.

SEGMENTATION

By Service Type Analysis

Hard Services Segment to Hold the Largest Market Share Backed by Expansion of Infrastructure Sector

Based on services, the market is segmented into hard services, soft services, and others. Among these, the hard services segment is expected to rise at a higher growth rate owing to the expansion of the infrastructure sector worldwide. The hard services included in the segment are cleaning, plumbing & drainage, building fabric maintenance, etc. such types of services are related to the physical part of the building.

Additionally, the rapid growth of the building & construction industry, owing to the increasing urbanization across the globe is the primary factor that is driving the hard services sub-segment. During the forecast period, the fastest-growing sub-segment under the service type segment is soft services, which is expected to grow significantly. This growth is attributed due to the increasing investments in waste management, energy management, wastewater management, and other green energy management sectors.

By Industry Analysis

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Real Estate Segment to Dominate the Market during the Forecast Period

Based on the industry, the market is categorized into healthcare, government, education, military & defense, and real estate.

The continuous growth in the construction industry across the globe is the primary factor that is set to drive the real estate sector over the forecast period. In terms of the market share, the real estate sector is anticipated to grow significantly followed by the others, which primarily include industries such as IT & telecommunication, and BFSI.

The government sector is expected to witness progressive market growth in the global market. This is owing to the government’s focus on investing in its infrastructural sector. Multiple types of services in the educational sector such as technical maintenance, space management, integrated services management, and many more. Healthcare and education sectors have the highest demand for facility management that can offer such services effectively and can help end-users to enhance and focus on their primary businesses.

REGIONAL INSIGHTS

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Asia Pacific held the largest market share, owing to the presence of multiple organized and unorganized players in countries such as India and China. Moreover, established key players are focusing on partnering up with local players to offer their services to end-users and expand their geographical presence. Also, rapid adoption of innovative technologies such as the Internet of Things (IoT) evolutions and business strategies are influencing the market in the country.

Furthermore, the market in North America is expected to grow gradually with the adoption of new technologies, such as IoT, AI, the adoption of robots, and others. However, owing to the impact of COVID-19, the market value will decline in 2020-2021 due to the immediate lockdowns in major states of the U.S. and Canada. Although with the adoption of government-initiated schemes, the market is projected to grow significantly during the forecast period. This is due to the increasing awareness of the cleanliness of the surroundings to combat the novel coronavirus.

Additionally, the facility management market in Europe is anticipated to grow moderately in the upcoming years. This growth is attributed to the adoption of precautionary measures by governments of several countries in the region. These precautionary measures will allow service providers to increase the workforce, productivity, and sales.

Besides, the market in the Middle East and Africa and Latin America is expected to grow significantly. Increasing investments in the tourism sector by governments in the Middle East and Africa is the primary reason that is driving the growth opportunities in this market for the region.

Moreover, the growing economy, commercial and residential sectors are the major factors that are impacting the growth of the market in Latin America.

KEY INDUSTRY PLAYERS

Collaborating with Regional and Local Players is Helping Prominent Players to Increase their Regional Presence

Service providers such as Sodexo, CBRE Group, Inc., ISS A/S, and Johnson Controls International plc. held the largest market share in terms of revenue in 2019. Such large enterprises are focused on grabbing new contracts in developing countries to make their presence stronger. Also, these companies are adopting new and innovative technologies to provide better and enhanced facility type of management services to their clients. For instance, in October 2019, CBRE Group Inc. launched an enterprise Software-as-a-Service (SaaS) 3D visualization tool named ‘Plans Pro’. It is utilized for faster decision-making of new and existing custom design standards that provide a wider range of integrated services such as facilities management, project management, transaction management, etc.

LIST OF KEY COMPANIES PROFILED:

• Sodexo (France)


• CBRE Group, Inc. (United States)


• ISS A/S (Denmark)


• Compass Group (United Kingdom)


• Aramark (United States)


• Jones Lang LaSalle Incorporated (United States)


• Cushman & Wakefield plc. (United States)


• Tenon Group (India)


• Johnson Controls International plc. (Ireland)


• Dussmann Group (Germany)

KEY INDUSTRY DEVELOPMENTS:

• June 2020 - Sodexo partnered with Bureau Veritas to introduce a hygiene verification label for Sodexo services that gives quality assurance to consumers. This partnership covers on-site facility management services and catering services. The label was introduced in the U.K., France, USA, Canada and then gradually rolled out in other countries across the globe.


• August 2019 - ISS has entered into a five-year Vested partnership with the major professional services firm in Nordics. Moreover, this contract will come into effect from 1st October 2019 in the Nordics region.

REPORT COVERAGE

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The global facility management market report provides an in-depth analysis of the market dynamics and competitive landscape. It provides various key insights including recent industry developments in the key market trends, such as mergers & acquisitions, macro and microeconomic factors, SWOT analysis, and company profiles.

Report Scope & Segmentation