The facility management market in Europe is expected to grow at a compound annual rate of 3.72% during the forecast period from 2021 to 2026. Europe is supposed to be one of the largest overseas markets for facilities management services in terms of maturity and development.
NEW YORK, November 22, 2021 (GLOBE NEWSWIRE) – Reportlinker.com announces the release of the report “European Facilities Management Market – Growth, Trends, Impact of COVID-19 and Forecast (2021 – 2026)” – https://www.reportlinker.com/p06177376/?utm_source=GNW
the main points
Europe is one of the largest overseas markets for facilities management services in terms of development and development. The facility management industry in the region operates with integrated contracts provided by important vendors across continents and borders, and small local players focus on individual contracts and individual service solutions. However, due to the dynamics taking place across the region, there are increasing opportunities to take advantage of facilities management and corporate real estate in new ways.
Furthermore, Facilities Management (FM) includes management methods and techniques for managing buildings, managing an organization’s infrastructure, and the overall alignment of an organization’s working environment. This system standardizes services and simplifies operations for the organization.
Over the past decade, many service vendors operating in the region have focused on expanding their presence to take advantage of the increasing demand for facilities management, particularly with the recent trend favoring the outsourcing of non-core operations. Furthermore, the UK is seeing increasing opportunities to leverage facilities management and corporate property in innovative ways, given the dynamics across the country.
In terms of end-user demand, the contribution of the public sector to the UK facilities management market is more significant than in any other part of Europe, primarily driven by constrained government budgets which result in the ongoing outsourcing of essential facilities management services.
Looking at the European facilities management market, it has experienced moderate growth due to the high demand for people with improved requirements. This scenario is expected to support the development of the market during the forecast period. The ongoing pandemic has led to a steady market growth in the region. However, the pandemic has resulted in limited production, which has led to a sharp decline in business inputs. ?
The COVID-19 outbreak has had a mixed business impact on facility management companies. Restrictions on the movement of people have led to a decrease in project work and a reduced level of activity across many client sites. Important market players, such as Mitie, CBRE Group and others, have been adversely affected by the pandemic shutdown.
Major market trends
The commercial buildings sector has a large market share
In Europe, investment firms usually decide to specialize in either the residential or commercial property market. Since commercial investments indicate higher cash flow potential and often provide better returns on investment, the commercial building sector offers lucrative opportunities, making it an attractive form of investment in the region, thus promoting the growth of the facility management market in the region during the forecast period.
The facilities management market is witnessing multiple partnership activities between vendors and commercial entities in Europe. For example, in September 2020, Hearst UK, a publisher of brands such as Harper’s Bazaar, ELLE, Cosmopolitan and Esquire, teamed up with Churchill Group and Pareto FM for utility services in its European offices. Under the terms of the agreement, Churchill portfolio may oversee cleaning and event management activities, with Pareto taking over responsibility for providing all planned and engaged maintenance and project management services related to textile, mechanical, electrical and textile related.
The growing interest in creating smart buildings and other IoT technologies is providing various opportunities for market vendors to introduce IoT-based facility management and accelerate the growth of smart buildings in Europe. For example, in January 2021, Climate partnered with Wattsense to deliver LoRaWAN appliances and a comprehensive energy efficiency solution to help property-owner facility managers improve and control energy consumption and adapt smarter technologies with IoT integration.
The growth of German facilities management services is attributed to the increasing demand for customized solutions for various indoor and outdoor facilities management. Moreover, the increasing number of commercial and residential buildings in major cities increases the demand for facilities management services across the country. In addition, the rapid development of infrastructure and the increasing focus on integrated facility management services is expected to positively affect the studied market.
The market is witnessing multiple strategic acquisitions among the market leaders in Germany to capitalize on the growing demand for digital facility management solutions. For example, in December 2020, EQT VII agreed to sell Apleona, DACH’s leading European provider of facilities management services, to PAI Partners for a deal worth around €1.6 billion. The company supports clients with a wide range of services, among others, with the goal of reducing building energy consumption and carbon dioxide emissions, and has built a strong client base in the region.
Modern offices with long-term tenants are still highly sought after by investors despite all the discussions surrounding hybrid business. The increasing business acumen among industry leaders and the diversification of the economy from the automotive industries into other areas is expected to increase the demand for facilities management services in the country.
Big data allows facilities management teams to strive for efficiency, sustainability and cost savings
Facility management has developed rapidly over the past several years, which has led to large-scale changes in European industry. Facilities management is undergoing a paradigm shift in the region as trends around data, disruption, advanced facilities and new workplace concepts are gaining momentum and becoming more and more common.
The trends in the European market are to progress from individual services to bundled services as well as towards an integrated facility management approach. This provides a wide range of services and long-term contracts, which adds value, leads to better quality and economies of scale, and increases demand for outsourcing services, where specialized expertise is required.
Offshore facility management has been used successfully in various sectors, including the public sector, retail, professional services, healthcare, technology, logistics, manufacturing, and education. The areas of interest in facilities management services vary widely and depend mainly on its type, size of the company and the sector in which it operates. This is not one size fits all. Some organizations will only require a single service solution provider, while other large organizations will look for bundled services that offer or a complete facility management solution.
Vendors in the region offer bundled services to their customers that provide multiple customer benefits. For example, PTSG, through its bundled services, provides a multidisciplinary capability to clients. This often gives them a complete specialized services solution, with the following benefits: a single point of contact for all services, a more focused approach towards servicing their assets, maintaining the building(s) in a first-class operational order, and associated cost savings. By offering a bundled service, the company can ensure compliance with all services offered by PTSG.
According to the RICS UK Facilities Management Survey for the second quarter of 2021, nearly 28% of respondents believe that the integrated FM segment will see the highest growth in the next twelve months in February 2021. The response rate saw a slight decrease at 27% of respondents. It is believed that integrated facilities management will see the highest growth in May 2021. In the first quarter of 2021 and the second quarter of 2021, combined facilities management and internal services received a higher percentage of responses to the growth rate. However, integrated FM was significantly ahead of single FM in the survey.
The facility management market in Europe is highly competitive with diverse companies of different sizes. This market is expected to face a number of partnerships and mergers and acquisitions as organizations continue to invest strategically to offset the current slowdown they are experiencing. Clients in this region use facility management services to increase the ease of their business operations. The market includes major solutions and service providers, such as CBRE Group, Mitie Group PLC, Emcor Facilities Services WLL, Interserve Limited and G4S Facilities Management UK Limited.
October 2020 – ENGIE launched a new modified model of carbon-neutral home renovation. With UK households responsible for more than a quarter of total UK carbon dioxide emissions and half of the market achieving an EPC rating of D or below, drastic steps are required if the UK is to achieve a collective reduction in greenhouse gas emissions by 2050. The new offering uses savings from improvement work combined with existing revenue streams and government incentives, including Energy Company Commitments (ECO), Renewable Heat Incentives (RHI), and grid balancing agreements to help fund upstream costs for the business.
February 2021 – CBRE Group acquires a 35% stake in Industrious, a provider of flexible workspaces, ahead of a potential initial public offering in 2021. CBRE, headquartered in Dallas, has paid nearly $200 million in cash for primary and secondary equity and is converting its flexible workspace Hana brand with ten locations in the US and UK.
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