| Published | Report Code | Available Format | Pages |
|---|---|---|---|
| April 2019 | PE11361 | 93 |
Kuwait Facility Management Market Overview
The Kuwaiti facility management market attained a size of $1893.3 million in 2018 and is projected to reach $3,077.7 million by 2024, witnessing a CAGR of 8.3% during the period 2019–2024. The growing applications of facility management services in commercial buildings, residential construction projects, infrastructure projects, and industrial projects are driving the growth of the market in the country.
The facility management industry in Kuwait is flourishing due to the increasing investment in the tourism and construction industries. The Government of Kuwait has been consistently rolling out new infrastructural projects. For example, in 2017, the country undertook the construction of $492 million runway at the Kuwait International Airport, and $1.3 billion project for the Burgan Oilfield. Such development projects are expected to boost the need for management services, which are required for maintaining their facilities.
On the basis of service, the Kuwaiti facility management market is classified into property services, cleaning services, security services, catering services, support services, environmental management services, and other services. The other services include reception staffing, utility management, furniture supplies, and contract management. Property, cleaning, and security are the three most preferred services among end users in Kuwait. Catering and support services are expected to register the fastest growth in the market during the forecast period, owing to their growing demand in the country’s hospitality and service industries.
Based on end users, the Kuwaiti facility management market is classified into commercial, industrial, and residential. The commercial sector accounted for the largest share in the market, accounting for more than 40.0% revenue share in 2018. Under its economy diversification plan, the country is witnessing large-scale expansion of hotels, commercial centers, malls, and several other commercial projects, which in turn, are expected to boost the demand for facility management services in Kuwait.
On the basis of mode, the Kuwaiti facility management market is categorized into in-house and outsourced. In-house mode of service dominated the market in 2018, with a revenue share of more than 75.0%. The dominance of in-house mode of service is driven by the fact that a large number of companies still operate through internal facility management team or professionals, which take care of regular maintenance of their properties.
On the basis of type, the Kuwaiti facility management market is categorized into hard services, soft services, and others. Hard services accounted for the largest share in the market in 2018, driven by the fact that these services are technical in nature and hence are expensive. Moreover, certain hard services such as HVAC maintenance services, mechanical services, and lift management services are of critical nature, which are essentially required by commercial, industrial, and residential units.
Kuwait Facility Management Market Dynamics
Trend
The major trend observed in the Kuwaiti facility management market is the country’s increased investment in the construction sector to decrease its economic dependency on the oil and gas sector. According to the Institute of International Finance (IIF), Kuwait faced the hardest hit from global oil output-cut that led to 2.2% economic contraction in 2017. Also, according to the Organization of the Petroleum Exporting Countries (OPEC), Kuwait’s energy sector makes up about 60% of its GDP and almost 95% of its export revenue. Hence, to reduce its reliance on the energy sector, the country is focusing on increasing private investments in other sectors such as tourism, hospitality, and construction, which is expected to attract foreign players and support the growth of the facility management market in Kuwait.
Driver
The growing hospitality industry in the country and increasing investment in upcoming infrastructure projects are the major drivers expected to propel the growth of the Kuwaiti facility management market.
The increasing investment in upcoming projects, especially in the residential and commercial units, malls, and others will strengthen the demand for facility management services in the country. Also, Kuwait’s growing real estate industry and increasing per-capita income of the young population are leading to high quality residential options, which in turn, are leading to increased demand for companies to manage these facilities. To provide maintenance facilities to these properties, local and regional players are tapping the market potential. The real estate development companies in Kuwait are also launching their own affiliates. Thus, infrastructure development will have a positive impact on the growth of the Kuwaiti facility management market.
Restraint
Lack of competent professional resources is the major restraint in the Kuwaiti facility management market. As facility management is a labor intensive industry, service providers are facing problem in hiring skilled staffs. This complicates the job of these companies, as their services are entirely based on workforce. Efficient professional resources provide successful delivery and quality services to customers. Also, as companies are relying on expatriate workforce, rules and regulations related to the immigration of workers are a major challenge faced by the market players in the country.
Kuwait Facility Management Market Competitive Landscape
Some of the major players operating in the facility management industry are Kharafi National, O&G Engineering W.L.L, Fawaz Refrigeration & Air Conditioning Company, EcovertFM Kuwait, Al Mazaya Holding Company, Al-Awsat United Real Estate Co., R&E Petroleum Co., Refrigeration Industries & Storage Company, PIMCO, and United Facilities Management.
