Egypt Facility Management Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022-2027)

The Egyptian Facility Management Market is segmented by Type of Facility Management (In-house FM Service, Outsourced FM Service (Single FM, Bundled FM, Integrated FM)), Offering Type ( Hard FM, Soft FM), and End-User (Commercial, Institutional, Public/ Infrastructure, Industrial).

Market Snapshot

CAGR
Study Period: 2020-2027
Base Year: 2021
CAGR: >2.5 %

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Market Overview

The Egypt Facility Management Market is expected to grow at a CAGR of above 2.5% over the forecast period 2022 to 2027. Facility management (FM) includes management methods and techniques for building management, infrastructure management for an organization, and also the means of overall harmonization of the work environment in an organization. This system standardizes services and streamlines processes for an organization. The country's facility management industry operates with integrated contracts provided by significant vendors and small local players that focus on single contracts and single-service solutions. However, given the dynamics occurring across the country, there are increasing opportunities to leverage facility management and corporate real estate in new ways.

· Approaches to on-site working shifted dramatically, and the FM sector needed to adapt accordingly. Technology and techniques have had to become increasingly mobile and flexible, and there is a heightened expectation from today's workforce about their wellbeing at work. At the same time, facilities managers are still adapting to the challenges of the hybrid workplace, such as dealing with supply-chain disruptions and material and labor shortages.

· Growth in urbanization leads to an augment in commercialization, which leads to an augment in the requirement for higher productivity in lower maintenance in dissimilar corporate offices, thus propelling the market growth. In addition, the surge in residential and non-residential building requirements increases the requirement for higher spending on construction involving the different mega projects. These projects demand huge investments, which in turn use maintenance services for longer construction structures. Thus, propelling the facility management services market growth. Moreover, awareness by dissimilar organizations to propel the assets and properties is augmenting, owing to high investment required for buying these assets, thereby boosting the growth of the market.

· In May 2022, Egypt's Panorama Developments introduced two projects in the New Administrative Capital (NAC) — the Panorama Business Centre and Panorama Mixed Centre. The first project, Panorama Business Centre, is an administrative, commercial building and is located in the NAC's Downtown area, made with investments worth approximately EGP 350 million. The second project, Panorama Mixed Centre, consists of three basements, a ground floor, and eight storeys containing 207 housing units.

· As new technologies emerge, expectations change, and working practices develop, the industry must react to meet the new technologies, opening new vistas for facility maintenance management software solution providers. Also, innovative technologies such as the Internet of Things (IoT), Big Data, and Machine Learning (ML) have become a critical part.

· Moreover, the real estate owners and government officials are considered forerunners after MNCs become increasingly aware of their assets' added value. This has been fueling the adoption of comprehensive and fully integrated service platforms delivering all facility management services, and thus, not to have each service delivered through different companies.

· Furthermore, the COVID-19 outbreak has acted as a catalyst for change and reiterated the need to pay attention to how facilities are managed and services are delivered. All built environments, owned or leased offices, warehouses, retail stores or manufacturing facilities, will require careful consideration and tailored plans. Digital technologies have changed how real estate functions and facilities are used. It has altered how, when, and where people work, redefining the workplace and the way of living.

· However, the lack of certainty regarding future labor costs and materials makes it riskier to build propositions, which could be a significant restraint for the players' bidding process for long-term contracts. Also, the outbreak of COVID-19 has had a mixed business impact on facilities management firms. The restrictions on the movement of people resulted in a decline in project work and a decreased level of activity across many customer sites.

Scope of the Report

Facility management (FM) is a profession that incorporates many disciplines to ensure functionality, safety, comfort, and efficiency of the built environment by integrating people, process, place, and technology. FMs contribute to the business's bottom line through its responsibility for often maintaining an organization's most significant and most valuable assets, such as property, equipment, buildings, and other environments that house personnel, productivity, inventory, and other elements of the operation.

Facility management services involve the management of building upkeep, utilities, maintenance operations, waste services, security, etc. These services are further divided into hard facility management services and soft facility management services spheres.

Both in-house facility management and outsourced FM services are considered in the scope. The integrated facility management service (IFM) market, along with single and bundled services, is included in the outsourced FM services segment.

Egypt Facility Management Market is segmented by Type of Facility Management (In-house Facility Management and Outsourced Facility Management (Single FM, Bundled FM, Integrated FM)), by Offering type (Hard FM, Soft FM), and by End-user (Commercial, Institutional, Public/Infrastructure, Industrial).

By Type of Facility Management Type
Inhouse Facility Management
Outsourced Facility Management
Single FM
Bundled FM
Integrated FM
By Offering Type
Hard FM
Soft FM
End User
Commercial
Institutional
Public/Infrastructure
Industrial
Others

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Key Market Trends

IoT Allows Facility Management Teams to Drive for Efficiency, Sustainability, and Cost Savings

· IoT will continue to grow in importance, where IoT or the Internet of Things will be seen to generate performance data alerting FMs to potential breakdowns in the country. FMs can monitor and control the devices from anywhere. For instance, G4S's technology solutions like SmartFM can lead to improvement in overall facility performance, the efficiency of assets, cost and energy savings, and increased productivity.

· Advances in IoT and connected objects that are coming in the future will enable more secure and accurate building management and maintenance. In simpler terms, the facility managers will benefit from real-time information feedback to the system to analyze data and control the equipment in a building with web-based automation.

· Furthermore, 5G will connect objects and equipment together and make them communicate with each other. The facility manager can then have a single management system controlled via a central platform maintained on a single site and linked to external apps via APIs. A connected device can also include many sensors and meters, each of which can be separately engaged or disabled over the network. According to International Telecommunication Union (ITU), fixed broadband subscriptions in Egypt have been increasing drastically over the past few years. In 2020, about 9.35 million subscriptions were registered in Egypt, two million more than the previous year.

· In addition, the facility manager will be notified in real-time of maintenance and repair needs, as well as security processes and reporting. The building's operation will also be described in greater detail. Also, better system documentation will lessen conflicts among owners, tenants, and facility managers. In this way, IoT and the advent of 5G are expected to revolutionize facility management in the country.

Egypt Facility Management Market

Commercial Segment to hold significant share in the market

· The commercial sector majorly covers the office buildings that are occupied by business services, such as corporate offices of manufacturers, IT and communication, insurance, property, and other service providers. The facility management services in the commercial sector is witnessing a rise in demand owing to the surging awareness among the users on optimizing their commercial building management expenditure. Also, the market in the commercial sector is anticipated to observe significant growth during the forecast period, primarily because of an increase in the number of malls, hotels, commercial centers, and other commercial sites in the country. Further, the increasing employment rate in the service sector is expected to drive market growth in the country.

· However, according to the Ministry of Planning of Egypt, the GDP from Construction Industry in Egypt decreased to EGP 53815.40 Million in the third quarter of 2021 from EGP 72147.80 Million in the second quarter of 2021. Such instances can hinder the growth of the market.

· Despite the tremendous income potential of outsourced FM, services are becoming more commoditized across the country, and organic growth is difficult to come by. Service integration and advanced advisory services focusing on productivity, user experience, and sustainability will become the norm in the business. Further, technology is fueling interest in managed workspace and co-working, with a significant portion of occupiers believing serviced offices will play a part in managing their accommodation needs over the forecasted period.

· Co-working will entail numerous different organizations, businesses, and individuals sharing space, similar to managed workspace, where a third party provides space and facilities. As it has been labeled, the co-working revolution reflects a growing demand among professionals and creatives for autonomy, a lack of hierarchy, flexibility, and community.

· Corporate real estate and facilities management are becoming increasingly vital to business success. Its trend is driven by changes in the built environment, which includes commercial, educational, industrial, recreational, residential, retail, and transportation infrastructure. It also helps businesses succeed by focusing on consistency, continuous improvement, and dependability through time, cost, and quality management. To improve corporate performance, facilities management in each built environment sector must be studied. An efficient facility management solution optimizes productivity through the use of specific productivity-focused tools and functions. These solutions suit all types of organizations, from entry-level employees to top-level management.

· Facilities management is ripe for disruption in the country. For instance, in terms of digital maturity and penetration of technology, it lags behind other tasks such as production equipment maintenance. Although technology is available for facilities management, a lack of digital skills inside the department, other leadership priorities, and an emphasis on constant cost-cutting have all stymied adoption. These considerations have made the facilities management outsourcing industry appealing to prominent suppliers who were already involved in this role, either directly or indirectly. In order to gain a larger share of the market, several incumbents have developed an integrated facilities management offering.

Egypt Facility Management Market

Competitive Landscape

The Egyptian Facility Management Market is fragmented and has few major players who have adopted various growth strategies, such as mergers and acquisitions, new product launches, expansions, joint ventures, partnerships, and others, to strengthen their position in this market. The major players in the market are Contrack FM, Enova, EFS Facilities Management, IFMC - Apleona Group, and Egypro-FME, among others.

· March 2022- The third edition of the Egyptian Facilities Management Forum was launched on March 22, 2022, which includes a group of major local and foreign facilities management companies. The forum presented local and international experiences in facility management through a strong presence of all parties to the system to discuss how to develop the role of facility management companies and to emphasize the role of companies in maximizing the benefit of facilities through the latest facilities management methods.

· March 2021- Nile Developments, one of the largest real estate companies in Egypt, announced its contract with Contrack Facilities Management (CFM), one of the Orascom Group companies, to provide integrated facilities management solutions for the construction of the first Festival Tower in The New Administrative Capital. The services to be provided by Contrack Facilities Management (CFM) for the construction of the Festival Tower include consulting services and facility management for the project in the planning stages and studying the needs of new facilities.

Recent Developments

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Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET INSIGHTS

    1. 4.1 Market Overview

    2. 4.2 PESTLE Analysis

    3. 4.3 Porter's Five Forces Analysis

      1. 4.3.1 Threat of New Entrants

      2. 4.3.2 Bargaining Power of Buyers

      3. 4.3.3 Bargaining Power of Suppliers

      4. 4.3.4 Threat of Substitutes

      5. 4.3.5 Intensity of Competitive Rivalry

    4. 4.4 Impact of Covid-19 on the Market

  5. 5. MARKET DYNAMICS

    1. 5.1 Market Drivers

      1. 5.1.1 Growing Trend Toward Commoditization of FM

      2. 5.1.2 Renewed Emphasis on Workplace Optimization and Productivity

    2. 5.2 Market Restraints

      1. 5.2.1 Diminishing Profit Margins and Ongoing Changes in Macro-environment

  6. 6. MARKET SEGMENTATION

    1. 6.1 By Type of Facility Management Type

      1. 6.1.1 Inhouse Facility Management

      2. 6.1.2 Outsourced Facility Management

        1. 6.1.2.1 Single FM

        2. 6.1.2.2 Bundled FM

        3. 6.1.2.3 Integrated FM

    2. 6.2 By Offering Type

      1. 6.2.1 Hard FM

      2. 6.2.2 Soft FM

    3. 6.3 End User

      1. 6.3.1 Commercial

      2. 6.3.2 Institutional

      3. 6.3.3 Public/Infrastructure

      4. 6.3.4 Industrial

      5. 6.3.5 Others

  7. 7. COMPETITIVE LANDSCAPE

    1. 7.1 Company Profiles

      1. 7.1.1 Contrack FM

      2. 7.1.2 Enova

      3. 7.1.3 EFS Facilities Management

      4. 7.1.4 IFMC - Apleona Group

      5. 7.1.5 Egypro-FME

      6. 7.1.6 CBRE Group, Inc.

      7. 7.1.7 JLL, Inc.

      8. 7.1.8 Qeema FM

      9. 7.1.9 G4S

      10. 7.1.10 Savills

      11. 7.1.11 ProService

      12. 7.1.12 Encorp Facility Management

      13. 7.1.13 Emdad Facility Management

      14. 7.1.14 Egypt Service

    2. *List Not Exhaustive
  8. 8. INVESTMENT ANALYSIS

  9. 9. FUTURE OF THE MARKET

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Frequently Asked Questions

The Egypt Facility Management Market market is studied from 2020 - 2027.

The Egypt Facility Management Market is growing at a CAGR of >2.5% over the next 5 years.

Contrack FM, Enova, EFS Facilities Services, IFMC-Apleona Group, Egypro- FME are the major companies operating in Egypt Facility Management Market.

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