The facilities management arena is forever changing, over the last three years, we have seen a number of new trends including an upsurge in mergers and acquisitions, environmental/energy management becoming more prudent and significant technological advances within the arena. I am going to explore these areas further and discuss whether these market trends will continue, and what other impacts we could encounter in 2018.
Mergers & Acquisitions
One merger everyone remembers, back in 2015, was the acquisition of Johnson Controls by CBRE Group for $1.475billion, a link that strengthened both companies. CBRE gained a new ability to provide wider facilities services for clients throughout the globe and Johnson’s enjoyed an increased income of $500million, becoming the preferred provider across their 5 billion sq ft of real estate, making it a shrewd move for both organisations.
This merger was quickly followed in 2016 with JLL acquiring the maintenance firm Integral for £250million. The UK provider of mechanical and electrical property maintenance made the business one of the largest mobile engineering service providers with one purchase. This acquisition was done to ensure they could strengthen their ability to perform across the EMEA and expand globally, it also added an additional 3,700 workforce to the businesses function.
iFM reported that 2017’s contract trends have continued on a similar path with the majority of new deals being within commercial environments across multiple services and lasting over 3 years.
Will the likes of Cushman and Wakefield, Colliers and Newmark now acquire for themselves? Or will smaller more specialist property companies begin acquiring service providers to compete?
Environmental/ Energy Management
Commercial buildings in the UK are estimated to attribute to almost 18% of carbon emissions, meaning landlords, managing agents and service providers are becoming more responsible for their Carbon footprint.
We have seen our clients taking a much more proactive approach to this area and my colleague Michael O’Brien has explored it further in his most recent article Reducing Energy Consumption in Commercial Buildings.
With the ever-changing political climate, do you feel property companies are going to continue to invest in this area?
With all the changes that the internet, emails and handheld computers have brought to the facilities management world, the market is asking what will be next? New expansions into VR, Flexible Displays, Smart Wi-Fi, IoT data and Blockchains, is probing the question – will professionals within the arena have to become even more computer savvy in the future?
Our Senior Marketing Executive, Katrina Whitehead has gone into further details on this specific topic in her article: Is Technology Taking Over FM?
Do you think that the above areas will come to fruition? Will these actually make a crucial impact on the sector?
As highlighted above, there are a number of areas where the facilities management market may change within the next year. These trends, as well as all the external factors including Brexit, the collapse of Carillion and other areas, will make 2018 an interesting year.
We are all waiting patiently to understand what will happen, however, what do you think is going to be the biggest trend within FM in 2018?