Saudi Arabia Soft Facility Management Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)

Saudi Arabia Soft Facility Management Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)

The Saudi Arabia Soft Facility Management Market size is estimated at USD 12.46 billion in 2024, and is expected to reach USD 23.06 billion by 2029, growing at a CAGR of 13.10% during the forecast period (2024-2029).

The Saudi Arabian soft facility management market is experiencing significant growth, driven by the growing construction and infrastructural activities, rising focus on quality of life and satisfaction of building occupants, and the country's increased focus on sustainability. Businesses increasingly acknowledge the direct connection between employee well-being and productivity. Consequently, soft service providers prioritize creating conducive and comfortable workspaces for employees. Such factors further propel the country's demand for soft FM services.

Key Highlights

• The booming construction industry due to the implementation of Saudi Vision 2030 and the growing hospitality and tourism sector are driving the growth of the Saudi Arabian soft facility management market. The country's hospitality and tourism sector is on an upward trajectory, marked by a surge in visitor arrivals and an increasing footprint of foreign hospitality vendors. This momentum in the hospitality sector has spurred construction activities, leading to a heightened demand for soft FM services. These services are pivotal in enhancing customer experience and comfort in hotels nationwide.
• Saudi Arabia's construction industry is surging, propelled by the ambitious goals of Saudi Vision 2030. This vision seeks to diversify the nation's economy beyond oil, resulting in monumental projects such as new cities, commercial hubs, and entertainment centers. Rapid infrastructure expansion demands a wide array of facility management services — from cleaning and security to catering and maintenance — all vital for ensuring smooth operations and sustainability.
• Saudi Arabia's hospitality and tourism sector, invigorated by the Vision 2030 initiative, is propelling the growth of the soft facility management (FM) market. As this sector expands, the demand for diverse FM services—ranging from cleaning and security to catering and customer service has surged.
• The Saudi Arabian soft facility management (FM) market is witnessing consistent growth, fueled by the Kingdom's ambitious economic diversification and swift urbanization. Yet, this expansion faces hurdles, notably a shortage of skilled talent and mounting pressures for cost optimization. While sectors like healthcare, hospitality, and corporate environments increasingly demand top-tier, specialized FM services, the local market struggles with a constrained pool of qualified professionals. This talent gap results in a heavier dependence on expatriate labor, a solution that, while effective, brings challenges, including high costs and complications from visa restrictions and localization policies.

Saudi Arabia Soft Facility Management Market Trends

Janitorial Services Holds Major Share

• The Saudi Arabian janitorial services market, a segment of the larger soft facility services arena, is on a steady upward trajectory. Key drivers include heightened investments in commercial real estate, a flourishing tourism industry, and government-backed initiatives such as Vision 2030, which drives infrastructure growth and urbanization. Spanning services from cleaning and maintenance to waste management, the market sees public and private sectors increasingly turning to specialized providers for outsourcing.
• Saudi Arabia’s Vision 2030 is spurring economic diversification and urban development, resulting in a boom of new commercial buildings, hotels, and residential complexes. This infrastructure surge fuels an increasing demand for janitorial services, essential for upholding cleanliness and hygiene standards. As urbanization accelerates, the need to regularly maintain public spaces and facilities intensifies, further propelling the market.
• According to the data from the World Bank, the share of the urban population in Saudi Arabia reached 84.95% in 2023. As cities become more densely populated and urban areas expand, the need to make buildings more pleasant, comfortable, and safe for their occupants increases.
• The hospitality industry is expanding as tourism continues to flourish, leading to a heightened demand for top-tier janitorial services. Hotels, resorts, and recreational facilities mandate consistent cleaning and maintenance to uphold guest satisfaction and adhere to health and safety standards. Ambitious undertakings such as NEOM and the Red Sea Project are poised to amplify the demand for janitorial services in the foreseeable future.

Commercial and Retail Industry to be the Largest End User

• The commercial and retail sector covers office buildings occupied by business services, such as corporate offices of manufacturers, IT and telecommunication, finance and insurance, property, convenience stores, and multichannel stores.
• Saudi Arabia's commercial and retail sectors are witnessing a rapid expansion in the soft facility management (FM) services market. This growth is largely attributed to Saudi Arabia's concerted efforts toward economic diversification and the swift evolution of its retail and commercial real estate landscapes. As businesses and retailers increasingly turn to outsourcing for non-core functions, there has been a notable surge in demand for soft FM services, encompassing cleaning, security, catering, and customer support. The market is fiercely competitive, with local and international players curating services to meet the distinct needs of commercial and retail settings.
• In response to this growing demand, investments in city development projects are rising. For instance, Saudi Arabia's Public Investment Fund (PIF) intends to invest SAR 4 trillion (USD 1.1 trillion) in real estate over the next ten years to develop 12 cities for the Saudi Downtown project. The country's total construction output value is estimated to reach USD 181.5 billion by the end of 2028, up almost 30% from 2023 levels, as per industry experts. Increased constructions have resulted in an increased need for soft facility management services for cleaning, security, energy management, and other services.
• Saudi Arabia is rapidly establishing itself as the GCC region's premier tourism destination. In line with this momentum, work is underway on Avenues, Riyadh, a monumental project valued at SAR 17.2 billion (USD 4.586 billion), set to make its grand debut in Q1 2026. The ceremony was in Q1 2022, and the project is 44.5% completion. Covering an expansive 390,000 sq. m, Avenues, Riyadh is set to feature a built-up area of 1,870,000 sq. m. This mixed-use development promises a rich tapestry of hospitality, lifestyle, and entertainment offerings. Notable features include three distinguished hotel towers: Waldorf Astoria, Canopy by Hilton, and Conrad Hotel. The development encompasses a residential tower, an office tower, and a vast parking facility accommodating over 14,000 vehicles.

Saudi Arabia Soft Facility Management Industry Overview

The Saudi Arabian soft facility management is fragmented, and FM companies are incorporating technologies into their services, strengthening their facility management service portfolio. A significant number of joint ventures/acquisitions were made with rising large-scale projects. Therefore, the intensity of competitive rivalry is high. Some players include Khidmah Sole Proprietorship LLC (Aldar Properties PJSC), ASMACS Group, Crystal Facilities Management Limited, Initial Saudi Group, and SGS Saudi Arabia (SGS SA).

• February 2024: Hassan Allam Holding revealed that its subsidiary, Kortech, secured comprehensive mechanical and electrical works for the headquarters of a leading developer in Saudi Arabia. The project is located in the King Abdullah Financial District (KAFD) in Riyadh. Kortech's extensive responsibilities span the 23rd to the 30th floor of Tadawul Tower. Its work includes electrical systems, fire-fighting systems, plumbing, HVAC, ELV ICT and communication solutions, data centers, broadcast systems, and 4K video walls, all contributing to a built-up area of approximately 21,000 sq. m.
• January 2024: Kortech, a subsidiary of Hassan Allam Holding and a leading engineering and construction company in the MENA region, announced a significant milestone. Their joint venture with Sharqawi, a Saudi electromechanical contractor, secured a major contract for a medical wellness resort. This resort is located within Amaala Triple Bay, an ultra-luxury destination on Saudi Arabia's northwestern coast. The project scope includes comprehensive mechanical, electrical, and plumbing (MEP) works for a 75-key hotel, 13 branded residences, and villas, covering a total built-up area of 175,000 sq. m. The work encompasses HVAC systems, electrical and light current systems, and fire-fighting & fire alarm systems.

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