By Ishrath Jaigirdar
Dubai, UAE
Public Investment Fund (PIF) of Saudi Arabia, one of the world’s largest sovereign wealth funds, has created FMTECH, a facilities management company, on August 10, 2023, to propel sustainable growth and enhance operational efficiency of the country’s US$37.37 billion facilities management industry (in 2022) that is set to grow exponentially due to the increase in demand for quality facilities management services in the Kingdom.
The facilities management industry provides essential services like utilities management, security, waste management, energy management, maintenance, housekeeping, and landscaping services to the property sector. PIF’s investment in this market is an initiative driven by multiple factors that eventually aim at boosting the country’s economy.
FMTECH specialises in producing cost-effective solutions and increasing the life span of properties and key industries such as health institutions and aviation. Through it, PIF can ensure to deliver quality services to entertainment destinations, residential and shopping complexes that will drive Saudi’s tourism. In line with Saudi’s advocacy for sustainability, the company will help in creating greener spaces that are energy-efficient. It will also act as an advisory body that advises on advanced, industry-leading innovation, one of which is a unified digital platform that will process facilities-related data.
Saudi Arabia’s facilities management market is growing at a Compound Annual Growth Rate (CAGR) of 11.2 percent from US$37.37 billion in 2022 to US$87.24 billion by 2030, according to P&S Intelligence, a research organisation. This reflects the market opportunities for facilities management companies in Saudi Arabia.
The growth in Saudi Arabia’s facilities management will be driven by the increase in housing, infrastructure, tourism development as well as the development of the large mega projects such as Neom, Qiddiyah, Al Ula, etc that will require quality and professional facilities management services for the upkeep of the facilities – which will accelerate the sector’s growth.
Mike Moore, Vice President of Al Bawani International, a construction company, reflected on the industry’s sudden demand during Covid-19 to Built Environment, saying, “Prior to Covid-19, facilities management was one of those industries which was in the background. People didn’t give it any thought, it just happened. But through the efforts of the FM industry, to keep people safe, keep places hygienic, and additional service into air conditioning filters, HEPA filters, all these services really put the FM industry on the map in Saudi Arabia.”
Vision 2030, Saudi’s major strategy to achieve economic diversification by reducing its dependence on oil, will play an important role in stimulating the speedy rise of infrastructure. PwC estimates around US$1 trillion worth of mega-projects are planned or under construction by 2030. In addition to this, Knight Frank finds that the booming hospitality sector worth US$110 billion, will also demand facility management services. PIF’s new FM launch will not only attempt to fill in the gap, but also acquire the current outsourcing companies under its umbrella and create an internal network of services.
As Vision 2030 approaches, the newly launched FMTECH will not only be an essential resource to the property sector, but also contribute indispensably to the local economy by creating jobs and lessening the country’s reliance on oil revenue.
“FMTECH will also bring futuristic technology to disrupt the FM sector and make it more futuristic, lean and more efficient. This way, the launch of FMTECH could be a game-changer for the FM industry in the region,” said an industry expert, requesting anonymity.
Ends
