Saudi Arabia Facility Management Market Size, Share & Industry Analysis, By Service Type (Hard Services, Soft Services, and Other Services), By Industry Vertical (Healthcare, Business & Corporate, Manufacturing, Government, Education, Military & Defense, Real Estate, Hospitality, and Others), and Country Forecast, 2024-2032

Saudi Arabia facility management market size was valued at USD 24.48 billion in 2023. The market is projected to grow from USD 25.75 billion in 2024 to USD 56.33 billion by 2032, exhibiting a CAGR of 10.3% during the forecast period.

Facility management includes multiple disciplines to ensure the comfort, safety, and efficiency of the built environment by integrating place, people, process, and technology. It also involves the management methods and techniques for the building and infrastructure management of any organization. Additionally, it also enables the overall coordination of work environment in an organization.

The COVID-19 outbreak had an adverse impact on the value chain and supply chain operations in the Saudi Arabia facility management industry. The disturbance in the value and supply chains, volatile demand and supply of facility services, and strict government restrictions curbed the logistics operations in the market.

In the current market scenario, the Saudi 2030 Vision is playing a significant role in propelling the economic development in the GCC region. This is expected to provide several opportunities for the automotive, heavy engineering, tourism, and construction industries. These factors are projected to surge the demand for facility services across these sectors while gaining advantages from the socio-economic factors in the future. The rapid growth in tourism and construction industries is expected to drive the Saudi Arabia facility management sector to new heights.

Saudi Arabia Facility Management Market Trends

Tech-driven Transformation Improves Operational Efficiency and Propels Market Growth

In the Kingdom of Saudi Arabia, a prominent trend lies in the rapid integration of technology to revolutionize operations and service delivery. This trend encompasses various facets, including the pervasive use of Internet of Things (IoT) devices and sensors within buildings to gather real-time data on energy consumption, occupancy rates, and equipment functionality. Moreover, the adoption of sophisticated Building Management Systems (BMS) has become widespread, empowering facility managers to centrally monitor and control diverse building systems such as HVAC, lighting, security, and access control.

Furthermore, predictive analytics and artificial intelligence (AI) are gaining traction within the industry, enabling facility managers to analyze vast datasets and anticipate equipment failures, maintenance requirements, and energy consumption patterns. By preemptively addressing potential issues, companies can minimize downtime, extend asset lifespans, and optimize resource allocation. Mobile applications and cloud-based platforms have also become indispensable tools for facility managers and technicians, facilitating real-time access to critical data, work order management, and streamlined communication. These solutions enable remote facility monitoring and management, enhancing responsiveness to client needs and improving overall operational agility.

Saudi Arabia Facility Management Market Growth Factors

Increasing Public-Private-Partnerships (PPP) and Energy Management to Boost Market Growth

In Saudi Arabia, the rise of public-private partnerships (PPP) signifies a pivotal shift in infrastructure development and management. These partnerships entail collaborative efforts between the government and private entities to finance, construct, and operate public projects. In recent years, PPPs have gained traction across various sectors, including transportation, healthcare, education, and utilities. A notable example is the expansion of the King Abdulaziz International Airport in Jeddah, where private firms are tasked with building and managing the facility over an extended period. Facility management services play a crucial role within PPP frameworks, encompassing maintenance, cleaning, security, and utilities management. By outsourcing these functions to private service providers, governments can ensure optimal operational efficiency and cost-effectiveness over the project's lifecycle.

Moreover, the adoption of energy management software enables real-time monitoring of energy usage, facilitating informed decision-making and continual improvement in energy efficiency. In essence, the convergence of PPPs and energy management initiatives presents a compelling opportunity for facility management companies to drive sustainable development, operational excellence, and economic growth in Saudi Arabia's built environment.

RESTRAINING FACTORS

Shortage of Stable Facility Management Contracts and Resources to Hinder the Market Growth

Many large facilities management enterprises with huge investment amounts usually do not face such challenges, as these companies take contracts for long periods. Moreover, large enterprises, most of the time, utilize innovative technologies to provide hard and soft services, which allows such companies to provide better and enhanced services. On the other hand, small and medium-sized companies face such challenges frequently, owing to the country's lack of financial resources and funding.

Additionally, the rapid growth in the infrastructure sector is demanding more workforce, which is affecting domestic facilities management across the country. With the sudden breakout of the pandemic in March 2020, the Kingdom of Saudi Arabia faced two major issues of the COVID-19 pandemic and a historic drop in oil prices and revenue simultaneously in several decades. The sudden halt in several sectors led to a slowed pace in the Vision 2030 program with a decline in foreign direct investments.

Therefore, these are the primary factors that impact the growth of the market in Saudi Arabia. However, to resolve such issues, workforce and controlling costs will play a vital role.

Saudi Arabia Facility Management Market Segmentation Analysis

By Service Type Analysis

Hard Services Segment to Dominate Due to Significant Investment in Infrastructure Development

Based on service type, the market is divided into hard, soft, and others.

Among them, the hard services segment is anticipated to hold the highest share owing to the increasing demand for plumbing, electrical systems, mechanical services, fire protection services, heating & cooling systems, lighting, building maintenance, and others.

The soft services segment is expected to expand at the highest growth rate due to their need across private and public enterprises. Enterprises are focusing on upgrading day-to-day organizational activities to lower operational costs and achieve efficiency overall.

Moreover, other services, such as environmental management, catering, utility management, and others, are projected to show stable growth. There is a rising demand for these services as the country is promoting tourism and hosting various conferences, exhibitions, and events.

By Industry Vertical Analysis

Healthcare Segment Grows at the Highest Rate Owing to Heavy Investments in the Healthcare Industry

Based on industry vertical, the market is segmented into education, government, healthcare, military & defense, real estate, business & corporate, manufacturing, hospitality, and others.

The healthcare segment is growing at the highest growth rate as the adoption of healthcare facility management services as a precautionary measure in various countries is increasing. For instance, in 2020, the Ministry of Health invested USD 71 billion in healthcare facilities and further to invest at a growth of 3.9% to reach its Vision 2030 goals.

The real estate segment held the highest market share in 2023, owing to the government’s focus on investing in its infrastructural sector. Initiatives taken in aim of Saudi Vision 2030 and National Transformation Program are providing a strong impetus to both the encouragement of foreign investment generally in the kingdom and also to the Saudi Arabia real estate sector. In addition to this several gigaprojects are designed to stimulate the economy and their benefits are expected to expand significantly beyond the real estate and infrastructure sectors, helping to diversify the economy away from oil, especially given their sheer scale.

For the government sector, ongoing infrastructure development projects and public service modernization efforts are expected to contribute to augmenting the Saudi Arabia facility management services, particularly in areas such as government offices, transportation infrastructure, and public facilities.

In the education sector, investments in educational infrastructure and the integration of technology into learning environments are likely to fuel demand for facility management services. The military & defense is anticipated to grow at a considerable rate in the future. As technology evolves in the defense industry, facility management services must adapt to support and maintain advanced defense systems effectively.

Business corporate, manufacturing, hospitality, and other industries are growing steadily due to increasing investments in infrastructure and the need for efficient operational support and maintenance services to sustain growth and productivity.

COUNTRY INSIGHTS

The Saudi Arabia facility management market growth is anticipated to be robust over the forecast period, owing to continuous industrialization and urbanization. The government is investing in constructing railways, ports, airports, and many other sectors. For this, the government is collaborating with various private contractors, including facility service providers, to keep the infrastructure clean and green. Investment from the private sector is expected to increase exponentially in the future, which will propel the market.

However, the pandemic restrained the growth of the market in 2020 due to the sudden lockdown announced by the governments to stop the spread of the virus. Moreover, the lesser impact of the pandemic has led to a modest rise in the renewal of facility service contracts across Saudi Arabia.

The Saudi Arabia facility management market share is growing due to significant investments in infrastructure by both public and private corporations. Furthermore, Saudi Arabia contributes major advancements in the facility industry as it is the fastest-growing country with a growing population and it is continuously working on investing in the healthcare and education sectors.

List of Key Companies in Saudi Arabia Facility Management Market

Key Companies Considerable Market Share Owing to their Continuous Investments in Digital and Technology Solutions

Leading players in the market are acquiring small & medium enterprises (SMEs) and regional players and are partnering with universities. This strategy helps them access and generate profits in markets that were previously difficult to enter. Key manufacturers focus on delivering a superior customer experience focused on value-added offerings to transform traditional service support. Prominent service providers are heavily investing in central production units to reduce wastage and rationalize labor costs. This results in strong retention rates even in unprecedented times. For instance, Compass Group PLC is strengthening its competitive advantage by focusing on central production units with innovation in operations such as hubs for development and training. The objective is to rationalize labor costs and reduce the wastage of food and other products, creating long-term value for stakeholders.

List of Key Companies Profiled:

• Sodexo (France)


• CBRE Group Inc. (U.S.)


• Compass Group PLC (U.K.)


• Cushman & Wakefield (U.S.)


• Tenon Group (India)


• Dussmann Group (Deutschland)


• Majid Al Futtaim – ENOVA (UAE)


• MEEM Facility Management Co. (Saudi Arabia)


• MUHEEL SERVICES (Saudi Arabia)


• INITIAL SAUDI GROUP (Saudi Arabia)


• Al Mahmal Facilities Services Company (Saudi Arabia)


• Afras (Saudi Arabia)


• TOFM (AlKifah Holding) (Saudi Arabia)


• EFS Facilities Services Group (UAE)


• G4S Limited (Saudi Arabia)


• Munjz (Saudi Arabia)


• TAMAM (Saudi Arabia)


• Fanni (Saudi Arabia)


• AJEER (Saudi Arabia)


• Albaap (Saudi Arabia)


• Just Mop (UAE)

KEY INDUSTRY DEVELOPMENTS:

• June 2023 - The Ministry of Tourism in Saudi Arabia unveiled plans to inject USD 4 billion into the tourism industry within the next five years.


• May 2023 - The Saudi government introduced a fresh regulation concerning the outsourcing of facility management services.


• December 2022 - Khidmah, a well-known company specializing in facilities management and home maintenance in the region, completed the acquisition of Pactive Sustainable Solutions, a company focused on green building initiatives, and Mace Macro Technical Services, the UAE-based Hard Facilities Management Arm of Mace Group. These acquisitions are in line with Khidmah's strategy for expansion and growth, aiming to improve its services, broaden its geographical presence, and enhance operational and financial performance.


• November 2022 - CBRE Group Inc., acquired Full Spectrum Group, an expert technical services provider for laboratory systems in the U.S., for USD 110 million. The acquisition aimed to enhance the technical capabilities of the existing global integrated laboratory solutions and attract more new clients in the fast-growing market.


• September 2022 - Sodexo expanded its partnership with the healthcare service provider Ardent. The collaboration would improve the patient-specific nutrition program and provide the nutrition they require.

REPORT COVERAGE

The report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product/service types, and leading industries for the facility management services. Besides, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that contributed to the growth of the market in recent years.

Report Scope & Segmentation