Saudi Arabia Facility Management Market

Introduction of the Saudi Arabia Facility Management Market Report

The facility management can be defined as a range of disciplines and services that ensures the functionality, comfort, safety and efficiency of the built environment by integrating people, place, process and technology. It contributes to the effective and efficient delivery of an organizations strategic and operational goals while providing a safe, productive, and comfortable environment.

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Key Drivers and Emerging Trends

Rapid industrialization and the growing adoption of the Internet of Things, industrial automation, and employee engagement programmes is expected to drive the growth of the facility management market in Saudi Arabia. In addition, facility management offers various benefits to an organization’s business strategy, communications management, operational efficiencies; support productivity of facilities and personnel; manages risks to facilities and personnel; promotes sustainable tactics for long-term cost management; reduces effects of natural disasters; and leverages security to the organization.

Increasing investment on technological advacement, Saudi Arabia planned to invest approx. 1 trillion on non-hydrocarbon sector by 2035. The council of economic and department affairs has taken various steps that are necessary for the second phase of Vision 2030 for continuous development of construction and other sectors in 2021. This will further increase the investment in tourism and construction industry to boost the market growth. Moreover, the rising infrastructure development projects across the Kingdom of Saudi Arabia, that include King Abdullah Financial District, Red Sea Project, Neom City, Qiddiya Entertainment City, and others and the Saudi Vision 2030 development plan, are expected to accelerate the development of digital infrastructure and encourage the expansion of businesses and corporates. This is expected to augment the growth of the facility management market in the country.

Restraint in the Saudi Arabia Facility Management Market

However, lack of managerial awareness, skilled workforce, and standardization are some of the major factors expected to restraint the growth of the Saudi Arabia facility management market over the forecast period. Additionally, increasing security concerns pertaining safety of devices and networks and the growing number of security breaches may further limit the market growth of the facility management market in Saudi Arabia.

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The continuous increase in the construction activities primarily through public private partnerships (PPPs) is anticipated to contribute to the rise in the demand of facility management, including HVAC equipment and plumbing, maintenance services, cleaning, security, catering, and support services. On the basis of solution, the market offers strategic planning and project management, maintenance management, workplace and relocation management, sustainability management among others.

According to World Travel & Tourism Council (WTTC) 2019 research, there has been a growth of 14% in Travel & Tourism in Saudi Arabia, contributed 9.5%, including direct, indirect and induced impacts, to the Kingdom’s total economy. The growth in the tourism industry is expected to increase the demand for facility management services across the country over the forecast period.

Under Saudi Vision 2030, the government planned to diversify its non- oil sectors to boost the economy. They further stated to deploy the public-private partnership to expand its education, healthcare and transportation infrastructure and to increase the energy requirements. It further planned to enhance its services by deploying public-private partnership projects for beneficiaries by providing more accessibility for the facility management industry in the Saudi Arabia. For instance, total budget allocated for housing, infrastructure and transportation sectors is around USD 9.06 bn in FY 2023 as per the Ministry of Finance, Saudi Arabia. Under this allocation, the government also planned to provide to support more than 120,000 families through its the national housing scheme Sakani.

The facility management solutions and services are used across several industries including Banking, Financial Services, and Insurance (BFSI), IT and Telecom, government and public administration, healthcare, education, retail, energy and utilities, manufacturing, construction and real estate among others. The facility management help in managing various operations processes, including asset management, maintenance management, space management, and work order tracking. The growing need for integrating data and the increasing focus on the complete management and maintenance of the buildings, people and assets of the business is expected to support the growth of the market in the country.

Moreover, the introduction of cloud-based facility management software provides management of business activities from remote locations. It helps in effective communication and collaboration with business teams remotely and in accessing the resources and assets through the internet. The facility management offer overall efficiency by saving time, reducing costs, and adding more value through proper maintenance and usages of the assets; provide space optimization tools to make the most out of office space; easy customization including customized dashboard for data visualization and automated report scheduling; and allows efficient tracking and management of business assets and provides real-time data for proper analysis.

Offering Type Segment Analysis

Soft FM segment is expected to grow during the forecast period owing to the increasing demand for soft FM services such as security management, cleaning and sanitization services, among others. In addition, growing demand from commercial entities is further driving the market growth. For instance, Musanadah Facilities Management Company signed and 5 years agreement with Zain Telecom to provide soft and other facility services in 2020.

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Key Developments:

• • In 2022, Khidmah introduced a digital platform Khidmah Home. This platform will offer professional maintenance services to residents and property owners.
  • In 2020, ENGIE Cofely, one of the prominent leaders in providing zero-carbon energy and innovative integrated facilities management solutions signed an agreement with the Energy City Development Company (“ECDC”), the owner and developer of King Salman Energy Park (“SPARK”). With this agreement, ENGIE Cofely will provide facilities management advisor and training provider for SPARK.

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Market Segmentation

Saudi Arabia Facility Management Market by Type

• • In-house Facility Management
  • Outsourced Facility Management

Saudi Arabia Facility Management Market by Offering Type

• • Hard FM
  • Soft FM

Saudi Arabia Facility Management Market by End-User Industry

• • Residential
  • Industrial
  • Commercial