Central and Eastern Europe (CEE) Facility Management Market Size
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2019 - 2022 |
| CAGR | 5.26 % |
| Market Concentration | Low |
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*Disclaimer: Major Players sorted in no particular order |
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Central and Eastern Europe (CEE) Facility Management Market Analysis
The CEE facility management market was valued at USD 21.67 billion in the previous year, and it is expected to grow at a CAGR of 5.26%, reaching USD 29.13 billion over the forecast period.
- The facility management sector, defined as offering maintenance support, project management, and user management, has grown significantly over the previous two decades due to the first expansion in urbanization and industrialization. The demand for such solutions and services has continuously increased and is expected to grow in the coming years. Government spending on transportation, energy, and building, among other things, is driving up the demand. Building management contracts with its service suppliers to deliver their services. Contract management includes personnel, equipment, and other services.
- According to the World Bank published data in May 2023, in 2021, Poland's urban population remained nearly unchanged at around 60.0%. In 2021, the Czech Republic's urban population remained roughly unchanged at about 75.21%. The need for efficient building maintenance and management increases as cities become more densely populated and urban areas expand. Facility management services include maintenance assistance, user management, and other support services to ensure the smooth operation of buildings and their associated infrastructure. Such a huge rate of urbanization is expected to drive the market studied.
- The rise in demand for air conditioners in the region is anticipated to propel the market studied. For instance, according to the data published by JRAIA (Japan Refrigeration and Air Conditioning Industry Association) in July 2022, Russia's demand for air conditioning devices reached 1,916,000 units in 2021, followed by Turkey with 644,000 units in the same year, Poland with 183,000 units, and Hungary with 118,000 units.
- Facility management cost optimization can be challenging due to various reasons. One of the primary challenges is reducing costs while maintaining the required level of service quality. Additionally, facilities managers need to balance the cost of maintenance and repair with the need for new equipment or upgrades. Another challenge is adapting to technological changes and innovations, which can require significant capital investment.
- The pandemic had a tremendous impact on the facilities management industry, resulting in a substantial shift in the operations, strategies, and functions of facility managers inside organizations. In the post-COVID-19 future, there is an increased demand for transformation, creative solutions, and unique planning strategies. Since the emphasis has shifted toward increased hygiene-related rules, better workplace safety and cleanliness, and a digitized work environment, sourcing and procurement play an essential role in the post-COVID-19 transformation, recovery, and restart of the facilities management industry.
Central and Eastern Europe (CEE) Facility Management Market Trends
Commercial Buildings to Witness Significant Growth Across the Region
- Commercial entities cover office buildings constructed or occupied by business services, such as corporate offices of IT and communication and other service providers. Due to the provision of necessary fitments, interiors, and commercial buildings, decoration and management have gained significant importance, driving the country's commercial sector market.
- According to the European Public Real Estate Association, as of September 2022, the value of commercial real estate in Poland was estimated at around USD 235 billion, the record value in the observed period. Such huge market value of commercial real estate may be due to the rise in the construction of commercial buildings, creating growth opportunities for the market studied.
- With the acceleration of digital transformation and the booming IT sector, global firms are establishing their corporate offices in the country, thus fostering the need for facility management services. In addition, more IT companies are emphasizing expansion plans in the country owing to the availability of talent and a favorable business environment.
- According to the Hungarian Central Statistical Office, non-residential construction permits gradually increased from January 2023 in the country, when construction permits accounted for 230 and increased to 384 in March 2023. The gradual rise in construction activities in the region is expected to increase the demand for HVAC equipment and significantly create an opportunity for hard and soft FM services.
- The demand for office spaces in cities like Bucharest increased significantly in 2022, reflecting a 5% increase compared to the demand in 2021, while the overall vacancy rate in the city has decreased due to the lack of new deliveries and permits for commercial building projects during the previous year. The expansion of IT companies with new offices in the country has increased in the last few years, adding growth to the market and creating demand for commercial office spaces and related hard and soft FM services. In April 2023, the Access Group announced the opening of two new offices in Romania and Ireland to continue its international growth and deliver innovative solutions for its customers.
Turkey to Hold Major Market Share
- According to Cushman & Wakefield, the general supply in the Istanbul office market was 6.46 million sq. m. at the end of 2022. A total of 516,789 sq. m. worth of transactions were completed in 2022, which is almost twice as much as in 2021. There was a 69% rise in lease transactions during the fourth quarter compared to last year, totaling about 163,653 sq m.
- According to TurkStat, in 2022, the occupancy permits for office buildings reached over 2.1 thousand. Such a rise in the occupancy rate of office buildings would push commercial building owners to adopt the various FM services to maintain the proper functioning of the building. These would also allow the FM players in the region to develop new soft FM and hard FM services to cater to the various needs of the clients.
- In terms of the end-user demand in the Government and Entities sector, the contribution of the public sector to the facility management market in Turkey is more significant than in any other part of the CEE region, primarily driven by the constrained budgets provided by the government that leads to the continuous outsourcing of essential facility management services. Bundled services contracts are poised to benefit from the public spending cuts, as public sector customers are looking to reduce suppliers and cut costs. This aligns with the developments in various public sector bodies that continually improve their operations.
- One primary responsibility for facilities management in retail concerns keeping the store area safe, clean, and attractive. Maintenance technicians can be assigned tasks such as cleaning floors, restrooms, and windows and assembling and maintaining product displays. At times, loading racks and other supplies may also fall to the facility management crew.
- According to Turkstat data, calendar-adjusted retail sales volume and turnover increased by 12.1% and 125.4% in November 2022 compared to the same month, 2021. At a rate of 33.7%, computers, books, and communication devices saw the most significant increase in sales volume. In terms of retail turnover by sector, online shopping led the way with a 148.6% increase. Such huge sales would drive demand for the market.
Central and Eastern Europe (CEE) Facility Management Industry Overview
The CEE facility management services market is fragmented as significant local players enter the commercial sector. For instance, the market is dominated by local players such as Strabag SE, Bilfinger SE, Dussmann Group, SIMACEK GmbH, and OKIN Group. The local players are offering competitive pricing in the market, which reduces the suppliers' bargaining power and gives the buyers an option to switch their facility management vendors with minimal switching costs quickly.
- In April 2023, BT Group extended a partnership with CBRE to provide facility and project management services to manage its UK portfolio. More than 7,500 properties will be covered, and over 80 000 BT Group and Openreach colleagues will benefit from the contract.
- In March 2023, international facilities service provider Atalian Global Services confirmed the sale of its UK, Ireland, and Asia operations and its automotive division Aktrion to Clayton Dubilier & Rice (CD&R). This private investment firm recently acquired OCS Group. A combined turnover of more than 2 billion pounds will be generated by this new organization, employing over 130,000 colleagues worldwide and operating in 26 countries.
- In February 2023, Dussmann announced that it was acquiring all 250 employees and selected assets and projects from Speidel GmbH, a medium-sized craft and service company based in Göppingen, focusing on electrical and communications technology. With this move, the company is strengthening its capabilities in building technology.
Central And Eastern Europe (CEE) Facility Management Market Leaders
Strabag SE
Bilfinger SE
Dussmann Group
SIMACEK GmbH
OKIN Facility (OKIN Group)
*Disclaimer: Major Players sorted in no particular order
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Central And Eastern Europe (CEE) Facility Management Market News
- June 2023 - SPIE acquired Enterprise Communications & Services GmbH, based in Germany, which provides technical information and communication technology services for a well-diversified customer base.
- April 2023 - Sodexo's Corporate Services division secured a four-year extension to its soft and hard FM contract with BAE Systems Munitions. The new contract has an estimated value of circa GBP 16 million (~USD 20.59 million) over four years. With employee engagement and well-being now a top priority, Sodexo has worked with BAE Systems to transform and expand its catering services, introducing new on-site pop-up catering points across BAE Systems locations. Meals are now produced in one of eight kitchens, which provides an enhanced dining experience for employees, enabling them to come together to eat, meet and connect.
- March 2023 - B+N Referencia Zrt. debuted its own-developed cleaning robot. During a press conference, Hungary's leading facilities management firm announced the deployment of 20 new in-house built cleaning robots in multiple domestic public buildings and the Budapest Ferenc Liszt International Airport.
Table of Contents
1. INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Market Overview
4.2 Market Size and Estimates for the Study Period
4.3 Industry Attractiveness - Porter's Five Forces Analysis
4.3.1 Bargaining Power of Suppliers
4.3.2 Bargaining Power of Buyers
4.3.3 Threat of New Entrants
4.3.4 Threat of SubstitutesProducts
4.3.5 Intensity of Competitive Rivalry
4.4 Impact of the COVID-19 Pandemic on the Industry
5. MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Rebounding Commercial Activity Expected to Drive Growth
5.1.2 Firms in Major Verticals Have Been Increasingly Focused on Outsourcing Non-core Operations, Such as Cleaning and Catering, in a Bid to Efficiently Comply with Health Regulations
5.1.3 Emphasis on Green and Sustainable Building Practices
5.2 Market Restraints
5.2.1 Fragmented Market with Several Local Vendors and Growing Competition Expected to Impact Profit Margins of Existing Vendors
5.2.2 Cost Optimization Problems, and Lack of Specialized Talents
5.3 Market Opportunities
5.4 Base Indicator Analysis
5.5 Average Gross Facility Management Costs Per Square Area for CEE
6. MARKET SEGMENTATION
6.1 By Offering
6.1.1 Hard FM
6.1.2 Soft FM
6.2 By Type
6.2.1 In-house Facility Management
6.2.2 Outsourced Facility Management
6.3 By Country
6.3.1 Poland
6.3.1.1 Current Market Scenario and Share of Outsourced FM
6.3.1.2 Market Breakdown by End-user (High-level Summary, Revenue for the Study Period and Market Outlook)
6.3.1.2.1 Commercial Buildings
6.3.1.2.2 Retail
6.3.1.2.3 Government and Public Entities
6.3.1.2.4 Other End Users
6.3.2 Hungary
6.3.2.1 Current Market Scenario and Share of Outsourced FM
6.3.2.2 Market Breakdown by End-user (High-level Summary, Revenue for the Study Period and Market Outlook)
6.3.2.2.1 Commercial Buildings
6.3.2.2.2 Retail
6.3.2.2.3 Government and Public Entities
6.3.2.2.4 Other End Users
6.3.3 Romania
6.3.3.1 Current Market Scenario and Share of Outsourced FM
6.3.3.2 Market Breakdown by End-user (High-level Summary, Revenue for the Study Period and Market Outlook)
6.3.3.2.1 Commercial Buildings
6.3.3.2.2 Retail
6.3.3.2.3 Government and Public Entities
6.3.3.2.4 Other End Users
6.3.4 Slovak Republic
6.3.4.1 Current Market Scenario and Share of Outsourced FM
6.3.4.2 Market Breakdown by End-user (High-level Summary, Revenue for the Study Period and Market Outlook)
6.3.4.2.1 Commercial Buildings
6.3.4.2.2 Retail
6.3.4.2.3 Government and Public Entities
6.3.4.2.4 Other End Users
6.3.5 Slovenia
6.3.5.1 Current Market Scenario and Share of Outsourced FM
6.3.5.2 Market Breakdown by End-user (High-level Summary, Revenue for the Study Period and Market Outlook)
6.3.5.2.1 Commercial Buildings
6.3.5.2.2 Retail
6.3.5.2.3 Government and Public Entities
6.3.5.2.4 Other End Users
6.3.6 Czech Republic
6.3.6.1 Current Market Scenario and Share of Outsourced FM
6.3.6.2 Market Breakdown by End-user (High-level Summary, Revenue for the Study Period and Market Outlook)
6.3.6.2.1 Commercial Buildings
6.3.6.2.2 Retail
6.3.6.2.3 Government and Public Entities
6.3.6.2.4 Other End Users
6.3.7 Turkey
6.3.7.1 Current Market Scenario and Share of Outsourced FM
6.3.7.2 Market Breakdown by End-user (High-level Summary, Revenue for the Study Period and Market Outlook)
6.3.7.2.1 Commercial Buildings
6.3.7.2.2 Retail
6.3.7.2.3 Government and Public Entities
6.3.7.2.4 Other End Users
6.3.8 Bosnia
6.3.9 Serbia
6.3.10 Croatia
6.3.11 Russia
7. COMPETITIVE LANDSCAPE
7.1 Company Profiles
7.1.1 Strabag SE
7.1.2 Bilfinger SE
7.1.3 Dussmann Group
7.1.4 SIMACEK GmbH
7.1.5 OKIN Facility (OKIN Group)
7.1.6 Vinci SA
7.1.7 HGC Facility Management Services Srl
7.1.8 B+N Referencia Zrt
7.1.9 Cushman & Wakefield PLC
7.1.10 ISS Facilities Services Inc.
7.1.11 Sodexo
7.1.12 Apleona GmbH
7.1.13 CBRE Group
7.1.14 Impel SA
7.1.15 Janosik Es Tarsai Kft.
7.1.16 Group Atalian
7.1.17 REIWAG Facility Services GmbH
7.1.18 SPIE Group
- *List Not Exhaustive
7.2 Vendor Market Share Analysis
8. INVESTMENT ANALYSIS
Central and Eastern Europe (CEE) Facility Management Industry Segmentation
Facility management services involve building upkeep, utilities, maintenance operations, waste services, security, etc. These services are further divided into hard facility management and soft facility management spheres.
The study tracks the facility management (FM) industry-related trends in CEE by analyzing the industry turnover accrued through end-user contracts by the service providers. The study tracks the revenues accrued from services offered for building operation and maintenance (mechanical and electrical services, heating and ventilation, plumbing, building services control and management systems, building fabric portable application testing, fire protection systems, fire alarm and detection systems), environmental management (energy management services, waste management, recycling services), IT and Telecommunication (establishment and maintenance of IT systems, the introduction of software packages), support services (cleaning, catering, vending, courier services, laundry services, post room staffing and management, reception staffing, security) and property management (space planning and design, asset management, property acquisitions and disposals, relocation management).
The Central and Eastern Europe (CEE) facility management market is segmented by offering (Hard FM, Soft FM), type (In-house Facility Management, Outsourced Facility Management), country (Poland (current market scenario and share of outsourced FM), end user (commercial buildings, retail, government and public entities), Hungary (current market scenario and share of outsourced FM), end user (commercial buildings, retail, government and public entities), Romania (current market scenario and share of outsourced FM), end user (commercial buildings, retail, government and public entities), Slovak Republic (current market scenario and share of outsourced FM), end user (commercial buildings, retail, government and public entities), Slovenia (current market scenario and share of outsourced FM), end user (commercial buildings, retail, government and public entities), Czech Republic (current market scenario and share of outsourced FM), end user (commercial buildings, retail, government and public entities), Turkey (current market scenario and share of outsourced FM), end user (commercial buildings, retail, government and public entities), Bosnia, Serbia, Croatia, Russia). The market sizes and forecasts are provided in terms of value (USD) for all the above segments.
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Frequently Asked Questions
What is the current Central and Eastern Europe (CEE) Facility Management Market size?
The Central and Eastern Europe (CEE) Facility Management Market is projected to register a CAGR of 5.26% during the forecast period (2024-2029)
Who are the key players in Central and Eastern Europe (CEE) Facility Management Market?
Strabag SE, Bilfinger SE, Dussmann Group, SIMACEK GmbH and OKIN Facility (OKIN Group) are the major companies operating in the Central and Eastern Europe (CEE) Facility Management Market.
What years does this Central and Eastern Europe (CEE) Facility Management Market cover?
The report covers the Central and Eastern Europe (CEE) Facility Management Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Central and Eastern Europe (CEE) Facility Management Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Central and Eastern Europe (CEE) Facility Management Industry Report
Statistics for the 2024 Central and Eastern Europe (CEE) Facility Management market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Central and Eastern Europe (CEE) Facility Management analysis includes a market forecast outlook to for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
