Ireland Facility Management Market Size & Share Analysis - Growth Trends & Forecasts (2023 - 2028)

Ireland Facility Management Market Size & Share Analysis - Growth Trends & Forecasts (2023 - 2028)

The Ireland Facility Management Market size is estimated at USD 2.96 billion in 2023, and is expected to reach USD 3.28 billion by 2028, growing at a CAGR of 2.05% during the forecast period (2023-2028).

Key Highlights

• The growth is majorly attributed to the growing infrastructural development in the country alongside the ever-increasing awareness among the people. The growing construction sector in the country post-pandemic and the growth of manufacturing sites are analyzed to bolster the demand for FM services in the country significantly.
• Moreover, facility management (FM) includes management methods and techniques for building management, infrastructure management for an organization, and overall accord of the work environment in an organization. This system standardizes services and streamlines processes for an organization. Services in the FM industry have been commoditized to a considerable extent. Also, end-user industries are very price-sensitive, and contracts are thus aimed at shorter terms. Commercial real estate over-supply has been creating pressure on rent yields, thus leading customers to cut costs on FM services.
• The construction sector of Ireland has a strong contribution to the Irish GDP, making it viable for the development of the country's economy. The strong dependency on the industry has pulled the ministry's attention to reform existing practices and lend out financial aid to support the sector's growth. The increase in construction activity directly impacts the development of the real estate market, creating the need for facility management services.
• Ireland has a significant manufacturing base, with many people employed in major areas such as pharmaceuticals and chemicals, food and beverage, medical devices, computers and electronics, and engineering. Industry 4.0 must be fully adopted to retain a competitive manufacturing base, boosting national productivity gains, supporting the sustainability of high-quality jobs, and supporting export-driven economic growth. This Industry 4.0 Plan is a core deliverable of Future Jobs Ireland, the government's new economic strategy to ensure Ireland is well-positioned to flourish in a world economy that is changing quickly.
• Even though outsourced FM has considerable revenue potential, the country's services are becoming more commoditized. FM services have become commodities, which compels vendors to innovate to sustain margins and growth. Additionally, because end-user sectors are highly price-sensitive, contracts are designed to be shorter in duration.
• With the outbreak of COVID-19, the Ireland Facility Management Market witnessed sluggish growth during 2020 and the beginning of 2021. During the initial phase of the virus outbreak, the imposed lockdown led to a workforce shortage across the FM companies, as the majority were non-local. The demand for soft FM services increased, particularly in public areas. This caused a significant increase in the workload and revenues of soft FM providers.
• The focus on cleanliness has placed a higher value on FM practices of controlling air quality, occupancy levels, and ventilation rates. Commercial buildings have deployed key guidelines for facility management companies to undertake such measures after the pandemic. FM vendors of all sizes have generated business by attaining contracts for cleaning services. The demand for cleaning practices in the post-pandemic era is expected to continue as companies direct employees to rejoin offices.

Ireland Facility Management Market Trends

Growing Construction Sector Drives the Market Growth

• The country's demand for facility management services is anticipated to rise as commercial real estate investments grow. In short to medium term, the industry is expected to experience substantial growth due to the government's ongoing rollout of new infrastructure projects.
• According to the government, Ireland's population will increase by 1 million by 2040, reaching 5.7 million. Project Ireland 2040 seeks to make the investments necessary to allow prosperity while balancing and sustainably accommodating this expansion. Project Ireland 2040 has improved regional connections, supported national competitiveness, and increased environmental sustainability in the first year since its inception. Growth will be constrained in the absence of the necessary infrastructure.
• The National Planning Framework (NPM), part of Project Ireland 2040, establishes a spatial strategy for Ireland to sustain and manage these enormous demographic shifts. The National Development Plan (NDP), developed after past errors, is a support system for the NPM, an infrastructure investment program.
• In February 2023, the Minister for Transport stated that local authorities would receive EUR 554 million (USD 669 million) from Transport Infrastructure Ireland (TII) for national highways and greenways in 2023. Local authorities will receive EUR 491 million (USD 524.25 million) from the Department of Transport's Exchequer capital funding for national highways, which will be used for 34 significant national projects. For the maintenance of national roads, EUR 34.85 million (USD 37.21 million) has been allocated. The NDP 2021–2030, which balances investment in transportation against other government objectives over the course of the plan, is considered for determining the funding allocations for 2023.
• Further, the growing residential projects are also contributing to the demand for hard and soft services in the country; for instance, in 2022, the residential community projects Belin Woods and Palmerstown residential, worth approximately USD 100M and USD 98M, respectively, began with the completion anticipated in 2025.
• Therefore, the growing construction sector in the country is analyzed to boost the demand for ground maintenance, waste management, and others, thereby impacting the facility management market in Ireland.

Soft FM Offering Type Holds Significant Market Share

• Soft services include cleaning, recycling, security, pest control, handyman services, grounds maintenance, and waste management. Facilities management firms have identified high-level cleaning services as a growth area for their business based on the rising complexity of projects across various parts of the country.
• Furthermore, the COVID-19 outbreak catalyzed change in how facilities are managed and services are delivered. As organizations will require careful consideration and tailored plans, the role of FM services providers can also become more strategic and long-term. Further, the consecutive increase in commercial real estate is expected to present growth opportunities for incumbents with difficulties, such as congestion in mature markets. Although the present market penetration remains limited (relatively), the demand is expected to continue to rise, with the impact of factors such as the establishment of new branch offices and outsourcing of soft facility management.
• The country's rising number of real estate activities is driving the demand for integrated facilities management services. According to Eurostat, the total revenue generated from Ireland's real estate activities is expected to surpass USD 5.5 billion by the end of 2025.
• Ireland is a lucrative market with significant demand for soft FM services. The country has witnessed strategic acquisitions contributing to market growth. For instance, with the recent Irish business Service Matters Ltd (SML) acquisition, CWS International has emerged as one of the nation's biggest suppliers of workwear, cleanroom, restroom, and floor care rental services. CWS also purchased Specialized Sterile Environments (SSE), an Irish cleanroom industry expert. This business, which employs over 350 people, specializes in providing cleanroom cleaning, decontamination, and hygiene services to the Irish medical technology and pharmaceutical industries. The current acquisition has significantly boosted CWS' market dominance in the Irish hygiene market. Customers have increased by 2,600, and CWS currently has 750 employees in Ireland.
• In April 2022, ABM, a prominent supplier of integrated facility services and solutions, announced that it had successfully acquired Momentum Support. This company has headquarters in Dublin, Republic of Ireland. In the Republic of Ireland and Northern Ireland, Momentum is one of the prominent independent providers of facility services, notably cleaning services. Momentum employed 2,300 people and had annual revenue of over USD 70 million in 2021. This acquisition aligns with ABM's ELEVATE growth strategy, which entails expanding the company's footprint through strategic acquisitions in lucrative end markets and locations.
• Further, the growing expansions in various industries are analyzed to contribute to market growth. In December 2022, Stephen's Green Shopping Complex in Dublin's city center announced that it would be expanded by EUR 100 million (USD 106.77 million) to add two floors, lower the present retail offering, and add office space. Dublin City Council has proposed building two more stories on top of the current landmark shopping center's six. With a partial retail level on the first floor and commercial office uses on the upper floors, the plan will reorganize the street-level retail mall to accommodate larger, higher-quality stores.

Ireland Facility Management Industry Overview

The Ireland facility management market is highly fragmented, with the presence of major players like CBRE Group Inc, Sodexo Group, Kier Group PLC, Sensori Facilities Management, and Cushman & Wakefield PLC. Players in the market are adopting strategies such as partnerships, innovations, and acquisitions to enhance their service offerings and gain sustainable competitive advantage.

In December 2022, Sensori FM signed an agreement as part of a design, build, and maintenance project for seven Community Nursing Units (CNUs) at locations throughout Ireland under the Health Information and Quality Authority (HIQA).

In July 2022, Kier upgraded facilities and training opportunities for prisoners at HMP Ranby, which will benefit them with improved learning facilities and training the Construction Skills Programme carries out, leading to greater employment opportunities.

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