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Tourism stands as a formidable economic force in nations like France, Spain, and the US, acting as a significant revenue generator and cultural wealth contributor. It serves as a crucial engine for economic development and growth, particularly benefiting from the globalized landscape. The World Tourism Organization (WTO) notes a notable increase, ranging from 50 to 60 percent, in individuals recurrently traveling to different countries, prompting increased investments in developing the tourism sector in numerous nations. However, the global economy, growing at a 3% rate according to the World Bank, has faced challenges impacting the hospitality and tourism sectors worldwide. The severe repercussions of COVID-19 led to a 93% decline in international tourist activities in June 2020, marking 2020 as one of the worst years for these sectors.
In response, countries implemented various strategies and campaigns to showcase the appeal of their tourist destinations, aiming to revive these sectors and contribute to an overall increase in per capita income. The substantial growth in tourism and hospitality has played a pivotal role in propelling the facility management services market forward at a rapid rate during the study period. As these sectors recover and adapt to new norms, the demand for facility management services continues to rise, supporting the diverse needs of businesses in the tourism and hospitality industry. Facility management services play a pivotal role in the day-to-day operations of organizations, ensuring the delivery of services offered by businesses. In the highly regulated landscape of various industries, encompassing safety training, data protection, and onsite management, facility management services become indispensable. The primary goal of these services is to document and establish compliance, aiding businesses in achieving their defined objectives.
These services contribute to the formulation of strategic plans that align with both long-term and short-term goals, focusing on aspects like profit generation and cost reduction. The emphasis on compliance is rooted in core business knowledge, and facility management services strive to automate error-prone and complex manual procedures. Recognizing the unique nature of businesses and the regulations governing them, these services, for example, navigate International Traffic in Arms Regulations (ITAR) restrictions that prohibit non-US citizens from entering facilities with national security interests. By ensuring proper control and procedures to protect privacy, facility management services become instrumental in supporting compliance. The imperative to comply with environmental and regulatory norms is anticipated to be a driving force propelling the facility management services market at a high rate during the forecast period. As businesses increasingly prioritize adherence to these norms, the demand for facility management services is set to surge.
Covered Aspects:
| Report Attribute/Metric | Details |
|---|---|
| Market Opportunities | Growing investment in the construction sector |
Facility Management Services Market Highlights:
Facility Management Services Market Overview
The facility management service market is estimated to reach a valuation of USD 670 billion by the year 2032, at a CAGR of 8.9% during the forecast period 2024 to 2032. Facility Management (FM) is a business function that integrates place, people, technology, and process to guarantee the physical environment's seamless functionality, comfort, safety, and efficiency. A group of upkeep services known as "facility management services" are used by businesses and housing developments to achieve their desired goals. The rapidly expanding tourist and hospitality industries, the need to adhere to environmental and regulatory standards, and the increased demand for value-added services all contribute to the growth of the facility management services market.
Figure 1: Facility Management Service Market Size, 2024-2032 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
The goal of the facility management services is to automate laborious and prone-to-error manual activities while focusing on compliance through core business expertise. These services are aware of the nature of the businesses and the rules that the company is subject to. The facilities management services encourage compliance by guaranteeing appropriate oversight and protocols for data security. As a result, the facility management services market is anticipated to grow rapidly during the forecast period due to the need to adhere to environmental and regulatory standards.
Facility Management Services Market Trends Insights
The new-age trend of utilizing cloud computing is aiding the facility management services market's growth.
Currently, cloud-based solutions offer a secure and protected method for hosting software related to facility management. Additionally, they aid businesses in cost reduction by enhancing security and collaboration among subsidiaries and teams dispersed across multiple regions. Moreover, cloud-based facilities management solutions offer superior security and scalability, expedited disaster recovery, and secure hosting for sensitive data.
Furthermore, backups are securely stored on either a public or private cloud hosting platform, enabling organizations to promptly access critical server information. Secure login credentials enable data access from any location with a dependable internet connection. The implementation of cloud-based facilities management systems results in increased customer satisfaction and decreased repair and maintenance costs. Therefore, the facility management market is experiencing growth due to the adoption and integration of cloud-based solutions, which can be attributed to the aforementioned benefits.
Facility Management Services Market Segment Insights
The facility management services market is primarily segmented based on service type and end-use industry.
Based on service type, the said market segment is further classified into hard services and soft services, out of which the hard services segment is estimated to dominate the market. The hard services segment is anticipated to maintain a substantial market share as a result of the infrastructure industry's sustained expansion. Furthermore, this industry encompasses cleaning, plumbing and drainage, building fabric maintenance, and various other labor-intensive services.
These utilities are integrated into the physical structure of the building. Additionally, the heavy services sector is being propelled by the burgeoning expansion of the building and construction industry, which can be attributed to the worldwide surge in urbanization. In addition, soft services, which are the subsegment of the service type that is expanding at the quickest rate, are anticipated to expand substantially over the forecast period. Furthermore, this increase can be attributed to heightened investments in sectors such as energy management, wastewater management, waste management, and renewable energy management.
Based on the end-use industry, the facility management services market is further sub-segmented into real estate, healthcare, education, and military & defense. Out of which, the real estate sub-segment dominates the market share. The real estate sector is anticipated to be the most active sector in the said market segment ly during the forecast period, owing to the continuous growth in the construction and development industries in numerous nations. Furthermore, it is anticipated that the real estate sector will experience significant growth in the market share, followed by the remaining sectors, which primarily consist of IT & telecommunications and BFSI enterprises.
Moreover, the healthcare sector is expected to experience substantial growth over the said forecast period due to the rising implementation of facility management services as preventative measures in numerous nations. Apart from this, the government sector is also estimated to earn a substantial market share by the end of the forecast period, which is primarily attributed to the government's emphasis on infrastructure investment. The educational sector encompasses a wide variety of services, including but not limited to space management, integrated services management, and technical maintenance. The highest demand exists in the healthcare and education industries for these services, which enable end-users to concentrate on and improve their core businesses.
Facility Management Services Region Insights
The facility management services market is primarily studied across four major regions, namely, North America, Europe, Asia-Pacific, and the Rest of the World. Out of which, the Asia-Pacific region dominates the market share.
The Asia-Pacific region accounted for the largest market share of about 37.92% in 2021. The region is a major hub for industrial manufacturing and, in recent years, has become a focal point for significant investments and business expansions. The rapidly growing construction spending, infrastructure development, increasing emphasis on the safety and security of the facility, and stringent government regulations regarding facility management are a few of the factors that are expected to drive the market growth.
Apart from this, the Asia-Pacific region is projected to hold the largest market share in facility management as a result of the presence of numerous organized and unorganized businesses in China and India. Moreover, well-established companies are placing emphasis on establishing collaborations with regional participants in order to deliver their services to end-users and expand their market presence. Furthermore, the APAC facility management services market is being widely impacted by the expanding implementation of innovative technologies, including advancements on the Internet of Things (IoT) and business tactics.
Furthermore, the North American facility management services market is anticipated to have consistent growth as a result of the integration of emerging technologies, including but not limited to the Internet of Things, artificial intelligence, and robot adoption. Furthermore, the implementation of security measures in critical states across the United States and Canada in response to the COVID-19 pandemic precipitated a market decline between 2020 and 2021. As an alternative, the market is anticipated to expand significantly over the course of the forecast period due to increased participation in government-sponsored programs.
Apart from these two regions, the European region is anticipated to experience significant growth over the coming years, owing to the preventive measures being implemented by the administrations of numerous countries in the region. Service-oriented organizations can optimize their personnel, output, and revenue by implementing these proactive measures.
Facility Management Services Market Key Players & Competitive Insights
Major key competitors in the said market segment employ crucial strategies, including partnerships, joint ventures, mergers and acquisitions, product launches, and business expansion deals to expand their business operations across the globe and have a strong command over a certain region in the market.
Facility Management Services Market Key Companies Insights
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Aramark Corporation (US)
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ASMACS Group. (India)
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CBRE (US)
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SIS Group Limited (India)
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Knight Frank (UK)
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Sodexo (France)
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Compass Group PLC (UK)
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EMCOR group. Inc (US)
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GDI integrated facility service (Canada)
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ISS Facility Service Inc. (Denmark)
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Cushman & Wakefield (US)
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Jones Lang LaSalle IP, Inc. (US)
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OCS Group Limited (UK)
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Quess Corp Ltd. (India)
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Apollo Facility Management Service (India)
Recent Developments
February 2024: CBRE Group Inc announced the acquisition of J&J Worldwide Services which offers engineering services and estate management services for the US Federal government, a deal that was facilitated through Arlington Capital Partners a private equity firm.
April 2024: Facility management software as a service provider SmartCheck raised debt funding during a round led by Incred Capital and Lakhani Financial Services. This round of financing has set Smart Check to position itself for growth as well as innovations in the ever-changing dynamics of facility management.
In March 2024, CBRE Group, Inc. unveiled AI technology during the building maintenance and cleaning of offices, which focused on reducing restoration and recovery time for the maintenance of facilities in office buildings.
In May 2024, ISS A/S entered into a joint venture with a leading robotics company to deploy autonomous cleaning and security robots in commercial complexes with the intention to improve efficiency and cut down on staff costs in the management of facilities.
Trimble acquired Ryvit in January 2023, a construction-focused integration Platform-as-a-Service (iPaaS) provider. Trimble intends to integrate the Ryvit platform into its Construction One platform.
In July 2022, JLL has acquired Envio Systems. We expect the Envio technology to provide a definitive structural change to the core of the building platform with new intelligent and sustainable buildings.
December 2022, The Nemetschek Group revealed that its subsidiary Spacewell has purchased DEXMA. DEXMA is in the business of providing energy intelligence based on data analysis.
December 2023: The Indian counterpart of the British multinational group Compass Group PLC, which manages large office complexes and food services for corporates, aimed to increase its facility management business from 2 million square feet to above 10 million square feet since the employees returned to the offices and the companies kept renting out more office space.
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