Rising investments in smart city projects across the world have led to the growing demand for facilities management (FM) services. It is expected that the value of the global FM market will hit US$2 trillion by 2025, according to new research by Global Market Insights.
Higher investments in the real estate and construction industry is supporting this growth. For instance, in 2017, the Canadian government issued additional funding of US$81.2 billion across five priority infrastructure streams, including public transit, trade, green, social and transportation. The government is taking initiatives to develop rural and northern communities’ infrastructure through the ‘Investing in Canada’ plan to build advanced economic cities.
With the increase in the number of construction projects, there is higher demand for various FM services, including construction, maintenance, operations, electric and mechanical works. Post-construction services, such as building cleaning and maintenance are also increasing across the world.
Other report findings show the growing tourism and hospitality industry has led to the rising demand for FM services across hotels, restaurants and entertainment centers. Also, growing industrialization will enable manufacturing companies to outsource the management of their facilities to enhance their focus on core competencies.
Tougher regulations and high scrutiny have enabled companies to outsource and deploy technology solutions that can optimize their facilities management.
The slow adoption of outsourced FM services can restrict market growth, as companies are inclined toward the use of in-house management staff. The report suggests that an in-house FM team may lack the required skill set and training required for performing specific operations, which may result in an inefficient approach toward the management of valuable assets of the organization.
With companies focusing on their core competencies to gain a competitive edge, outsourced services are expected to skyrocket during the forecast period. Meanwhile, hard services are poised to hold a major share by 2025 due to the development of smart homes and offices. Mechanical and electrical equipment like elevators, fire safety and HVAC systems require frequent maintenance to support their uninterrupted operations. The hard FM service providers have skilled labor to manage these services without affecting the core operations of any business.