The global facilities management services category is expected to grow at a CAGR of 12% from 2023 to 2030. Hard facilities management customers are switching from labor-intensive to technologically sophisticated options, especially for security and fire. Managing growing energy expenses and achieving non-negotiable ESG targets and the decarbonization strategy are the major factors that make energy management solutions an increasingly sought-after investment topic in 2023.
According to Grant Thornton’s 2022 report, in the hard FM service sector, given the evolving nature of the workplace, the demand for office reconfigurations has increased steadily. In 2022, there were 14 deals for fabric maintenance, fit-out, and refurbishments compared to four deals witnessed in 2021. Similarly, HVAC facilities management deals in 2022 reached 12 compared to six in 2021.
On the other hand, based on FM M&A deals by type of acquirer, the percentage of deals completed by trade buyers amounted to 55% in 2022. This is a 6% increase from 2021. This indicated that private equity players are taking a cautious approach amid rising debt costs and trade buyers have realized that more consolidation can lead to economies of scale while maintaining the margins.
Grant Thornton’s FM 2023 report indicates that in H1 2023, transaction deals in the UK reached a total of 87. The deal volumes have continued their upward trajectory since 2019. It was also found that during the first half of the year, 47% of the facilities management deals in the region were funded by private equity. Hard FM deals continued to dominate the category in H1 2023. Cleaning services in soft facilities are expanding as a result of the ongoing focus on hygiene following the pandemic. In H1 2023, soft facilities management deals in the cleaning services segment increased to 23% compared to 15% in H1 2022.
Order your copy of the Facilities Management Services Procurement Intelligence Report, 2023 - 2030, published by Grand View Research, to get more details regarding day one, quick wins, portfolio analysis, key negotiation strategies of key suppliers, and low-cost/best-cost sourcing analysis
A few instances of some of the notable deals in the FM sector were:
• In July 2023, Cap10 Partners LLP announced the acquisition of Sureserve Group plc. The deal was valued at USD 260 million. The latter specializes in providing compliance and energy services. Through Cap10’s support, Sureserve aims to achieve the UK’s Net Zero targets of many public sector bodies and social housing.
• In May 2023, Freshstream Investment Partners Limited announced the acquisition of MCR Group. The latter is an Irish provider of outsourced solutions such as security, personnel, engineering, and cleaning services. The deal aims to expand MCR’s operations further across Ireland.
• In March 2023, Carbon Architecture was acquired by Bellrock Property & Facilities Management. This was Bellrock’s first venture in the decarbonization sector. The deal would enable Carbon Architecture to form a new division while expanding its analytics and software solutions to Bellrock’s 900+ clients. The solutions will help customers achieve their net-zero targets.
• In March 2023, HIG Capital through its affiliates purchased Synecore and Meesons Future Limited. The Andwis Group will be formed by Meesons, Synecore, Classic Lifts and CPS. The last two are H.I.G.'s portfolio companies. With the help of this deal, they aim to form a combined integrated technical services provider serving all HVAC sub-segments across commercial, leisure, retail, and hospitality industries.
Facilities Management Services Sourcing Intelligence Highlights
• The global facilities management services industry is highly fragmented. Compared to hard FM services, the soft FM services market is more consolidated. However, the number of transaction deals occurring in the hard facilities management services sector has been on the rise following the pandemic.
• The four major cost inputs in this category are labor, materials and supplies, energy, and taxes and government policies.
• The bargaining power of the global suppliers is moderate due to increased fragmentation. However, compared to general service providers, integrated facilities management suppliers command a higher bargaining power owing to the provision of specialized services and a higher global reach.
• In this category, Germany is the most mature and the largest market in Europe.Innovations like personalized workspace concepts and active space management are what distinguish these markets in particular. Higher ESG standards and increased operation and maintenance costs force companies to make larger investments in their structures.
Browse through Grand View Research’s collection of procurement intelligence studies:
• Management Consulting Procurement Intelligence Report, 2023 - 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)
• Customer Relationship Management (CRM) Procurement Intelligence Report, 2023 - 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)
List of Key Suppliers
• Jones Lang LaSalle IP Inc. (JLL)
• Sodexo
• CBRE Group, Inc.
• Compass Group plc
• Cushman & Wakefield Global, Inc.
• MAB Facilities Management
• Aramark Corporation
• EMCOR Facilities Services, Inc.
• OCS Group
• Serco Group plc
• Veolia Environment S.A.
• Tenon Group
• ISS A/S
Facilities Management Services Procurement Intelligence Report Scope
• Facilities Management Services Category Growth Rate: CAGR of 12% from 2023 to 2030
• Pricing Growth Outlook: 10% - 18% (Annually)
• Pricing Models: Cost Plus, contract-based, fixed and variable service-based pricing model
• Supplier Selection Scope: Cost and pricing, past engagements, productivity, geographical presence
• Supplier Selection Criteria: Type of FM service (cleaning, HVAC, food, laundry, building, etc.), technological software, operational capabilities, quality measures, certifications, data privacy regulations, and others
• Report Coverage: Revenue forecast, supplier ranking, supplier positioning matrix, emerging technology, pricing models, cost structure, competitive landscape, growth factors, trends, engagement, and operating model
Brief about Pipeline by Grand View Research:
A smart and effective supply chain is essential for growth in any organization. Pipeline division at Grand View Research provides detailed insights on every aspect of supply chain, which helps in efficient procurement decisions.
Our services include (not limited to):
• Market Intelligence involving – market size and forecast, growth factors, and driving trends
• Price and Cost Intelligence – pricing models adopted for the category, total cost of ownerships
• Supplier Intelligence – rich insight on supplier landscape, and identifies suppliers who are dominating, emerging, lounging, and specializing
• Sourcing / Procurement Intelligence – best practices followed in the industry, identifying standard KPIs and SLAs, peer analysis, negotiation strategies to be utilized with the suppliers, and best suited countries for sourcing to minimize supply chain disruptions