Market Trends of Latin America Soft Facility Management Industry
This section covers the major market trends shaping the Latin America Soft Facility Management Market according to our research experts:
Commercial End User is Expected to Hold a Significant Market Share
- The government's commercial projects in the Latin America region focus on the construction of smart cities and the implementation of advanced automation technologies are expected to propel the demand for the soft facility management market over the next five years.
- Moreover, the rise in foreign direct investments for infrastructure developments and the growing construction of commercial buildings creates enormous growth opportunities for the soft facility management market. For instance, in May 2022, Equinix acquired four data centers from EmpresaNacional De TelecomunicacionesS.A. ("Entel") in Chile. Equinix also signed an agreement to acquire another data center from Entel, with all five data centers holding an enterprise value of USD 735 million. Equinix operates eleven International Business Exchange (IBX) data centers in Brazil, Mexico, and Colombia.
- According to the United Nations Conference on Trade and Development (UNCTAD), Mexico was the 10th largest destination for foreign direct investments, with approximately USD 32 billion in 2021. Furthermore, the increasing FDI investments and new opportunities from infrastructural projects across the Latin America region are further anticipated to propel the soft facility management market demand.
- The government infrastructure initiatives using private capital in Mexico were operational as of March 2022. 113 projects were currently in the implementation stage. Such infrastructure development projects will increase the need for soft facility management services.
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Brazil is Expected to Witness Significant Growth
- The Brazilian soft facility management market is driven by an increasing number of commercial establishments such as MNCs and local corporations, rising technological integration resulting in increased efficiency, and rising FDI (Foreign direct investment) investments in the country. This has increased the demand for soft facility management services in the country.
- According to the United Nations Conference on Trade and Development (UNCTAD). Brazil was the 6th largest destination for foreign direct investments, with approximately USD 50 billion in 2021, an increase of USD 22 billion from 2020. Also, the value of greenfield projects announced increased by 3%, and the number of international project finance deals increased by 32% in 2021.
- In addition, ongoing infrastructure development activities, a rising real estate sector, and a surge in demand for energy-efficient green buildings are expected to add growth to the soft facility management market. For Instance, Shizen International Inc. (Shizen International) has signed an agreement to construct a solar farm for 17 locations in Brazil for a total of 33.4 MWp will be completed this year.
- Brazil's construction market reached USD 73 billion in 2021. This indicates that the construction industry is expected to grow further, and the demand for the soft facility management market is expected to grow over the next five years.
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