Expanding real estate, retail and tourism sectors to drive demand for facilities management services, says TechSci Research study commissioned by MEFMA
The value of Saudi Arabia’s facilities management (FM) market is expected to reach $49.82 billion by the end of 2030, according to a forecast by the Middle East Facility Management Association (MEFMA).
The forecast is part of a report commissioned by MEFMA, titled ‘Facilities Management Role in Achieving Saudi Arabia’s Vision 2030,’ which investigates the industry’s pivotal function in the Saudi government’s long-term economic diversification plan. Done by TechSci Research and released on the sidelines of the recently concluded Saudi Arabia Confex 2017 in Riyadh, the report also shows that the expected growth can be attributed to key drivers that include expanding real estate, tourism, and retail sectors.
Jamal Abdulla Lootah, president of MEFMA, said: “Saudi Vision 2030 is an all-encompassing economic framework that focuses on its non-oil sectors, including real estate, tourism, and retail, to name a few, to help reduce its reliance on oil revenues. Part of its objectives is to boost government revenues from $159.99bn in 2016 to $1866.52bn by 2030. The non-oil sectors are forecast to experience significant expansion in the coming years in light of the government’s full support and commitment to drive their growth.
“The role of facilities managers in this regard is going to be critical as they will be the key to ensuring the sectors’ smooth operational performance. The report navigates closely and deeply delves into this strategic role in a bid to guide regional industry leaders, players, and stakeholders to step up to the challenge and substantially contribute to the realisation of the Saudi government’s vision.”
According to MEFMA, Saudi Arabia has the largest market for FM services in the GCC, accounting for a share of about 55% in the region’s FM sector in 2016, valued at around $20.3bn. The report looks into several ways by which FM companies can significantly contribute to the country’s socio-economic expansion. FM companies, it says, help increase the competitiveness of the local commercial and industrial enterprises by enabling businesses to focus on their core operations.
Additionally, capital infused by global FM companies could further catalyse growth in the local services sector and thus generate considerable employment opportunities. The report also states that the expansion of small- to medium-scale FM providers will help stimulate the development and promotion of KSA’s small and medium enterprises.
The study also tackles the local FM industry landscape to present many market opportunities. It notes, for instance, that the FM market in Saudi Arabia is highly cost sensitive and people consider FM essentially as a preventive maintenance process.
The FM market in Saudi Arabia and the region is dominated by demand for hard services. In KSA, the study says that the rapid consolidation of the FM market will boost local demand for soft services in light of the growing presence of new international FM companies in the country.