Saudi Arabia Facility Management Market Size
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 8.73 Billion |
| Market Size (2029) | USD 15.79 Billion |
| CAGR (2024 - 2029) | 10.51 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Saudi Arabia Facility Management Market Analysis
The Saudi Arabia Facility Management Market size is estimated at USD 8.73 billion in 2024, and is expected to reach USD 15.79 billion by 2029, growing at a CAGR of 10.51% during the forecast period (2024-2029).
The facility management sector in the country is based on integrated contracts provided by major vendors. At the same time, small local companies focus on single contracts and single-service solutions. There are growing opportunities to leverage facility management and corporate real estate.
- Several service providers operating in the country have prioritized their expansion over the last decade to profit from the growing demand for facility management, particularly with the current trend favoring the outsourcing of non-core activities. This is also consistent with the efforts being made by several public sector organizations to streamline their operations. As the need for total facilities management (TFM) grows, public sector organizations in the country are progressively outsourcing all non-core business operations to a single service provider, allowing them to focus more on core business.
- Investments made by the Saudi government in the development of infrastructure projects as a part of diversifying the economy are rapidly growing in areas such as the development of air transport, urban planning, logistic centers, and tourism. This creates fertile ground for facility management services as they are required to maintain these facilities and new infrastructure.
- Outsourced FM has been successfully used in the country in various industries, including the public sector, retail, professional services, healthcare, technology, logistics, manufacturing, and education. The areas covered by FM services vary widely, mainly depending on the type and size of the company and the sector in which it operates.
- The lack of awareness of the importance of facility management poses a significant challenge in the market studied. Enterprises in the country are trying to focus on their core businesses, but they are reluctant to outsource FM activities as a part of the vision to focus on the core. Talent retention and acquisition pose considerable challenges in the Saudi facility management market. The skilled facility management professionals demand, including technicians, engineers, and skilled laborers, continue to grow with the growing infrastructure and real estate sectors. However, retaining and attracting talent in a competitive job marketplace can be difficult.
- The COVID-19 pandemic created both opportunities and disruptions in the FM industry. While payment delays and working capital issues afflicted the industry, the demand for cleaning and sanitization services also witnessed a significant increase. Cleaning, sanitization, and disinfection services were most in demand during the pandemic. Heating, ventilation, audit, air conditioning, HVAC, and maintenance benefits also have the highest order.
Saudi Arabia Facility Management Market Trends
In-house Facility Management to be the Fastest Growing Type of FM
- In-house facility management refers to a wide range of tasks and responsibilities related to maintaining and operating a company’s buildings, equipment, and infrastructure by a dedicated team of employees hired directly by the company instead of outsourcing to external vendors.
- Government initiatives such as Saudi Vision 2030 focus on diversifying the economy and infrastructure development, fueling the growth of construction projects requiring the need for facility management services. According to the Ministry of Finance, the budget allocation for housing, infrastructure, and transportation sectors in FY 2023 was reported to be around SAR 34 billion (USD 9.06 billion). Increasing investments in commercial buildings and mega-projects like NEOM are expected to drive demand for in-house facility management services to maintain and operate buildings, utilities, and other infrastructure needs.
- Government regulations in the healthcare and finance sector emphasize an increased focus on control over facilities, making in-house management a strategic consideration for compliance.
- Several factors, such as increased economic activity, consumer spending, and tourism activities in Saudi Arabia, have increased the occupancy of hotels and commercial spaces. This has, in turn, increased the need for better management of the facilities, thus driving the growth of the segment. In June 2023, the Minister of Tourism stated that the tourism sector’s contribution to Saudia Arabia’s GDP reached 4.45%, and the country will invest over USD 800 million in the upcoming ten years. This growth and plans of investment in the tourism sector are likely to benefit the facility management industry with demand for in-house facility management services.
- The growing number of companies looking to consolidate in the facility management market and rising investments in large-scale infrastructure projects are expected to drive the demand for in-house facility management services in the country. Saudi Arabia is home to many Muslim holy sites, resulting in many visitors and travelers each year and creating opportunities in the hospitality and construction industry.
- Overall, factors such as increased economic activity, consumer spending, and tourism activities have led to an increase in the occupancy of large residential layouts/projects, hotels, and commercial spaces, resulting in an increased need for better management of the facilities.
Manufacturing and Industrial Industry is Expected to Witness Significant Growth
- The manufacturing and industrial sector covers major applications across the manufacturing industry, such as food and beverage, electronics, automotive, mining, and oil and gas industries. Saudi Arabia has one of the fastest-growing manufacturing industries in the region, owing to several projects by the government, low taxes, and business-friendly regulations favoring automation and the advancement of the manufacturing sector. Saudi Arabia aims to shift from its oil-based economy and is in talks with Jordan and Egypt for a USD 500 billion industrial zone powered by renewable energy. Known as NEOM, the zone will focus on industries such as energy and water, biotechnology, food, and advanced manufacturing, propelling the demand for facility management in the country.
- Many projects also drive advanced control systems and automation in infrastructure development. Focus on the manufacturing sector led by Industry 4.0 indicates the company's readiness to adopt new technologies to boost production output at a better quality, further augmenting the growth of the FM market in the country. For instance, in November 2023, the Vedanta group established a new copper unit in Saudi Arabia for SAR 1 million (USD 0.3 million) through its subsidiary Malco Energy Limited. The group announced in an exchange filing that Vedanta Copper International (VCI) Business Limited is the new entity's name.
- In October 2023, to establish an automobile manufacturing factory in Saudi Arabia, South Korean automaker Hyundai announced that it had teamed up with Saudi Arabia's Public Investment Fund (PIF). In accordance with this, PIF will own 70% of the company, and Hyundai will own 30%. An annual production capacity of roughly 50,000 automobiles is the goal of this facility's setup. Production at this factory is expected to start by 2025.
- Based on offering type, the manufacturing and industrial sector in Saudi Arabia is expected to witness increased demand for soft FM driven by the need for efficient facility management, workplace safety, and adherence to environmental regulations.
- Thus, the Saudi manufacturing and industrial facility management sector is characterized by a resilient, innovative, and adaptable environment. According to Tophotelprojects.com, in Saudi Arabia, in 2022, 24 out of 167 planned development of hotel projects were expected to be completed by the year end. 40 projects, which means 24% of total hotel projects, were due to be completed by 2025 at the earliest. The strategic significance of facility management services in preserving operational effectiveness, safety, and sustainability is expected to become even more apparent within this vital and dynamic industry as the nation continues on its trajectory of industrial growth.
Saudi Arabia Facility Management Industry Overview
The Saudi facility management market is highly fragmented, with the presence of major players like Initial Saudi Group (Alesayi Holding), EMCOR Saudi Company Limited, Almajal G4S (Allied Universal), SETE Energy Saudia for Industrial Projects Ltd (Sete Saudia), and Zamil Operations and Maintenance Company (Zamil Group). Players in the market are adopting strategies such as partnerships and acquisitions to enhance their product offerings and gain sustainable competitive advantage.
- In September 2023, Alesayi Holding Group acquired 85% of Initial Saudi Group, a leading facilities and workforce management group with over 40 years of operating experience. The agreement was signed in the presence of Alesayi Holding Group CEO and Initial Saudi Group’s board member. Initial Saudi Group operates through its two major firms, Initial Facilities Management and Workforce Saudia. With over 25,000 associates, Initial provides various services across Saudi Arabia, including cleaning, security, engineering, support, pest control, and landscaping. The acquisition is driven by Alesayi Group’s primary focus on extending and diversifying its service offerings to cater to the growing demand for workforce services for the rising industries and emerging possibilities within the Saudi Vision 2030 framework, along with enabling seamless integration between the Group’s sectors and companies.
Saudi Arabia Facility Management Market Leaders
Initial Saudi Group (Alesayi Holding)
EMCOR Saudi Company Limited
Almajal G4S (Allied Universal)
SETE Energy Saudia for Industrial Projects Ltd (Sete Saudia)
Zamil Operations and Maintenance Company (Zamil Group)
*Disclaimer: Major Players sorted in no particular order
Saudi Arabia Facility Management Market News
- January 2024 - The Saudi government allocated more than USD 186 billion to the Saudi Green Initiative and tremendous resources, time, and effort to tackle climate change. The Public Investment Fund (PIF) is a prime example of using idle assets for national development, focusing on generating returns and stimulating growth. To accelerate diversification across several sectors, the government has prioritized 13 sectors for profitability. PIF has deployed the most significant fresh capital in 2023, investing over USD 35 billion.
- October 2023 - JLL, a professional services firm specializing in real estate, investment management, and development consultancy services, reported the establishment of its regional headquarters at the King Abdullah Financial District in Riyadh. The strategic move to the heart of the capital’s new Central Business District was unveiled at the 7th Future Investment Initiative in Riyadh, where JLL’s President and Global CEO Christian Ulbrich outlined strategies and precautions that must be employed to navigate the current global real estate market. The move is part of the company’s commitment to strengthening JLL’s presence in Saudi Arabia.
- August 2023 - Saudi Arabia’s Public Investment Fund (PIF) announced the establishment of the Saudi Facility Management Company (FMTECH) to offer a comprehensive range of services, including utility management, energy management, waste management, maintenance, housekeeping, security, and landscaping services.
Saudi Arabia Facility Management Market Report - 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 Industry Attractiveness - Porter's Five Forces Analysis
4.2.1 Bargaining Power of Suppliers
4.2.2 Bargaining Power of Consumers
4.2.3 Threat of New Entrants
4.2.4 Threat of Substitutes
4.2.5 Intensity of Competitive Rivalry
4.3 Base Indicator Analysis
4.3.1 Construction Activities In Saudi Arabia
4.3.2 Expansion of Key International FM Services
4.3.3 Growth in Commercial Establishments
4.4 Impact of COVID-19 on the Saudi Arabia FM Market
5. MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Infrastructure Development and Growing Real Estate Sector
5.1.2 Increasing Outsourcing Trend and Supporting Government Initiatives
5.1.3 Emphasis on Green and Sustainable Building Practices
5.2 Market Challenges
5.2.1 Lack of Awareness of the Importance of Facility Management, Cost Optimization Problems, and Lack of Specialized Talents
5.2.2 Security and Compliance Concerns
6. MARKET SEGMENTATION
6.1 By Type of Facility Management
6.1.1 In-house Facility Management
6.1.2 Outsourced Facility Management
6.1.2.1 Single FM
6.1.2.2 Bundled FM
6.1.2.3 Integrated FM
6.2 By Offering Type
6.2.1 Hard Facility Management
6.2.2 Soft Facility Management
6.3 By End-user Industry
6.3.1 Commercial and Retail
6.3.2 Manufacturing And Industrial
6.3.3 Government, Infrastructure, and Public Entities
6.3.4 Institutional
6.3.5 Other End-user Industries
7. COMPETITIVE LANDSCAPE
7.1 Company Profiles*
7.1.1 Initial Saudi Group (Alesayi Holding )
7.1.2 EMCOR Saudi Company Limited
7.1.3 Almajal G4S (Allied Universal)
7.1.4 SETE Energy Saudia for Industrial Projects Ltd (SETE Saudia)
7.1.5 Zamil Operations and Maintenance Company (Zamil Group)
7.1.6 SAMAMA Holding Group
7.1.7 Khidmah Saudi Arabia (Aldar Properties PJSC)
7.1.8 ENGIE Solutions (Engie Group)
7.1.9 Nesma Trading Co. Ltd
7.1.10 Al Yamama Company
7.1.11 Olive Arabia Co. Ltd
8. INVESTMENT ANALYSIS
9. FUTURE OF THE MARKET
Saudi Arabia Facility Management Industry Segmentation
Facility management services involve building upkeep, utilities, maintenance operations, waste services, security, etc. These services are further divided into hard and soft facility management services. Hard services comprise mechanical and electrical maintenance, fire safety and emergency services, building management system controls, elevator and lift maintenance, conveyor maintenance, etc. Soft services include cleaning, recycling, security, pest control, handyperson services, ground maintenance, and waste disposal. The market for the study tracks the revenue accrued from the sales of hard and soft FM services in the country.
The Saudi facility management market is segmented by type of facility management (in-house facility management, outsourced facility management [single FM, bundle FM, and integrated FM], by offering type (hard facility management and soft facility management), by end-user industry (commercial and retail, manufacturing and industrial, government, infrastructure and public entities, and institutional). The market sizes and forecasts are provided in terms of value in USD for all the above-mentioned segments.
| By Type of Facility Management | |||||
| In-house Facility Management | |||||
|
| By Offering Type | |
| Hard Facility Management | |
| Soft Facility Management |
| By End-user Industry | |
| Commercial and Retail | |
| Manufacturing And Industrial | |
| Government, Infrastructure, and Public Entities | |
| Institutional | |
| Other End-user Industries |
Saudi Arabia Facility Management Market Research FAQs
How big is the Saudi Arabia Facility Management Market?
The Saudi Arabia Facility Management Market size is expected to reach USD 8.73 billion in 2024 and grow at a CAGR of 10.51% to reach USD 15.79 billion by 2029.
What is the current Saudi Arabia Facility Management Market size?
In 2024, the Saudi Arabia Facility Management Market size is expected to reach USD 8.73 billion.
Who are the key players in Saudi Arabia Facility Management Market?
Initial Saudi Group (Alesayi Holding), EMCOR Saudi Company Limited, Almajal G4S (Allied Universal), SETE Energy Saudia for Industrial Projects Ltd (Sete Saudia) and Zamil Operations and Maintenance Company (Zamil Group) are the major companies operating in the Saudi Arabia Facility Management Market.
What years does this Saudi Arabia Facility Management Market cover, and what was the market size in 2023?
In 2023, the Saudi Arabia Facility Management Market size was estimated at USD 7.81 billion. The report covers the Saudi Arabia Facility Management Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Saudi Arabia Facility Management Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Saudi Arabia Facility Management Industry Report
Statistics for the 2024 Saudi Arabia Facility Management market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Saudi Arabia 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.
