North America Soft Facility Management Market- Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

North America Soft Facility Management Market- Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The North American Soft Facility Management market is expected to register a CAGR of 3.9% over the next five years. Key soft facility management companies, such as CBRE Group Inc., Sodexo Inc., ISS Global, ION Facility Services Inc., and GDI Integrated Facility Services, are innovating consistently by making significant R&D investments.

• North America's facility soft management service market growth is attributed to the increasing demand for customized solutions for different in-house and outsourced soft facility management services. Moreover, the rising number of commercial and residential buildings in major cities further drives the need for soft facility management services across the country. Additionally, increased infrastructure development and the increasing focus on integrated facility management services are anticipated to influence market growth positively.
• Long-term soft facility management services contracts will create new growth opportunities for the market. For instance, ISS extended a partnership agreement with Hewlett Packard Enterprise for the next five years. This partnership aims to deliver a wide range of integrated facility services to HPE's offices and production sites across 51 countries and more than 170 sites. The integrated facility services include technical maintenance, facilities maintenance and repair, catering and hospitality services, landscaping and cleaning services, and a wide variety of support services (helpdesk, shuttle service, etc.).
• The demand for Soft Facility Management services is growing positively across North America. For instance, ISS's innovation project known as FacilityCobot is to develop a unique mobile robot that can relieve cleaning staff from repetitive or physically exhausting tasks. This first-of-its-kind solution integrates a smart building sensor system with a human-robot interface allowing the robot to work efficiently side by side with cleaning staff in large open-space areas such as canteens and offices. The project has a budget of USD 2.75 million, including USD 1.67 million from the Innovation Fund, and is expected to be completed in next year. These robots used for cleaning practices will bring new growth opportunities to the soft facility management services market.
• The outbreak of COVID-19 had a mixed business impact on soft 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. Significant players in the market studied, such as Mitie, CBRE Group, and others, were adversely affected due to the pandemic lockdown. Post-COVID-19, there is an increasing demand for Soft Facility services, including office cleaning, waste management, gardening, pest control management services, and security guard services.

• Healthcare has become one of the leading sectors, owing to the increasing number of patients and rising healthcare expenditure by the public and private players in healthcare systems. As per the data published by the Centers for Medicare and Medicaid Services (CMS), in United States, national healthcare spending is projected to grow at an average rate of 5.4% per year during 2019-2028, reaching nearly USD 6192.5 billion by 2028.
• Healthcare industries are also expanding their operations worldwide, which might create opportunities for the SFM Market. For instance, ISS, headquartered in United States, is planning to strengthen its position in the healthcare segment in Turkey. ISS will provide Facility Management (FM) services (cleaning, security, food, pest control, landscaping, reception, patient transport, laundry services, and waste management) in a Public-Private-Partnership at four newly built hospitals (Adana, Elazıg, Bursa, and Yozgat) in Turkey until 2045.
• Healthcare establishments require various facility management services, such as waste management, security services, catering services, cleaning services, technical support services, and many more, whose demand is likely to increase soon. With increased investments in healthcare infrastructure, the demand for Soft Facilities Management is expected to grow.
• Furthermore, in May this year, Penn Highlands Healthcare started construction of a new hospital with an investment of USD 70 million, which includes a technologically advanced hospital and medical office building in State College. It is anticipated that the new healthcare construction trends will continue in the upcoming years. Increasing awareness of the need for cleanliness, security, and maintenance will fuel the North America Soft Facility Management market.

• In addition, increased investments in infrastructure developments drive the demand for Soft Facility Management across United States. For instance, ISS awarded a 5-year contract to provide integrated facilities management services with a major US retailer. ISS will provide integrated facilities management services across the retail, office, and industrial space. ISS's integrated facilities management service includes providing technical, food, workplace experience, and cleaning services.
• The growth in construction activities across United States is significantly boosting the demand for FM services in the region. For example, the rising global population is increasing the demand for food and beverage industries. For instance, Biotics Research Corporation, a nutritional supplement maker, is planning to spend USD 9 million to build an 88,000-square-foot warehouse, laboratory, and office facility in United States and expects to complete it by 2023.
• Similarly, in June last year, Darigold announced the plan to spend USD 500 million to build a 400,000-square-foot processing facility in United States by the end of 2023. Such projects are expected to drive the demand for SFM services in the country.
• Key players offer soft facility management services and contribute significant growth in the market. For instance, CBRE Group Inc. provides soft facility services such as cleaning, catering, etc. The company's services saw a significant slump due to COVID-19. Post-COVID-19, the demand for cleaning and catering is expected to create new opportunities for the SFM market.
• According to the CMM survey, approximately 40% of the respondents spent between 21% and 40% of their operating budget on facility management services, especially cleaning /maintenance equipment and supplies. This indicates that the rising demand for cleaning/maintenance services will contribute to growth in the market.

The North American soft facility management market is moderately fragmented due to ongoing partnerships and recent advancements in the market. Some major players in the market studied include CBRE Group Inc., Sodexo Inc., ISS Global, ION Facility Services Inc., and GDI Integrated Facility Services.

In February 2022, ISS renewed its soft facility management contract with a global pharmaceutical company for the next five years to provide GMP cleaning and general cleaning, food and hospitality services, landscaping and security services, as well as a wide variety of support services (mail, laundry, helpdesk, etc.).

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