Market Trends of Philippines Facility Management Industry
The In-house Facility Management Segment is Expected to Hold Significant Market Share
- In-house facility management services are provided by a dedicated resource employed by the client for performance monitoring and control. There is a rising demand for in-house facility managers in the Philippines to manage business-specific areas, including heavy burst-traffic zones and conference rooms used by busy executives. Additionally, in-house facility management provides training and required specialized certifications that a partner organization may not offer in their standard packages.
- In-house facility management involves recruiting specialized personnel to maintain and manage various functional attributes of a facility. Services such as cybersecurity assistance are often operated and monitored in-house to ensure the safety and integrity of the facilities. Integrated facilities management (IFM) is witnessing rapid adoption in the Philippines due to the growing demands to manage end-to-end facility needs and create consistent service levels. Integrated facility management is crucial to respond to potential disruptions proactively. It has emerged as a new approach to drive efficiencies in facility management, simplify workflows, and streamline operations.
- As per the National Economic and Development Authority, there are around 22 ongoing projects in the Philippines till 2024 and around 10 ongoing projects till 2028. With infrastructure development, facility management services also rise due to the requirement of achieving operational cost efficiency by deploying professional services. This facility management provides solutions and equipment to ensure that building operations run smoothly without any disturbances. Through these services, people, places, and processes are integrated, enabling the comfortable life of people living in the apartments or buildings.
- With the advent of Industry 4.0, in-house facility managers are in high demand in the Philippines. This further accelerates the need for a smart maintenance process to prevent equipment breakdown and optimize downtime. With advancements like AI, automation, and IIoT, facility managers strive to implement Maintenance 4.0 quickly.
- In February 2023, Manila Water Co. Inc. partnered with Damosa Land Inc. to manage water facilities for an industrial estate. Manila Water's subsidiary, Manila Water Philippines Ventures Inc. (MWPV), is spending about USD 2.20 million to operate and manage the water system of Anflo Industrial Estate (AIE), Damosa Land's industrial development for trade and agriculture. The partnership aims to meet the estimated demand of 2.6 million liters per day by integrating additional facilities into AIE's existing systems, generating demand for facilities management in the country.
- The Philippines is recognized as one of the most dynamic markets in Asia, whose fast-emerging economy consistently sustains its growth. The country's real estate industry is considered one of the most resilient. Its excellent financing services, capitalization, and pro-business climate drive the best in-house facility management solutions.
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The Commercial Segment is Expected to Hold Significant Share in the Market
- Commercial facilities in the Philippines need expert facility managers for cleaning, maintenance, and security management of commercial buildings. Commercial facility management firms coordinate between an organization's internal departments and external parties to provide services. The FM would negotiate vendor contracts, assign local vendors, and liaise between tenants and service providers.
- There has been a rise in adaptive commercial spaces in the Philippines, and according to a recent study by Cushman & Wakefield, the Philippines branch of Booking.com, an online travel agency, selected the service provider to find a new space for Booking.com's new office for further expansion. To fulfill the travel agency's aim of shifting to a new area in the Central Business District (CBD) of Makati, a city in the Philippines' Metro Manila region, Cushman & Wakefield identified an ideal space by negotiating with the owners to lease a small vacant space adjoining the client's current office. Booking.com was able to lease extra space with a 15% discount from the building's original rental rate, all due to the facility management services provided by Cushman & Wakefield.
- In the Philippines, hard facility management is gaining significant growth for commercial spaces as it can provide businesses with access to expert services in HVAC, electrical, plumbing, and maintenance of a commercial area. For instance, the country's aviation industry has become more connected, augmenting the need to integrate data between systems to increase efficiency across the connected aviation ecosystem.
- In June 2023, AirAsia Philippines' parent company, Capital A, launched a logistics business and an aircraft maintenance, repair, and overhaul facility in the country. Capital A's engineering business provides heavy maintenance, repairs, and overhaul (MRO) services for the group's commercial aircraft, propelling the market growth.
- Commercial facility operators in the country are looking to outsource the manaPhilippines'eir businesses to focus more time and attention on investments. A single-source facility management solution helps them streamline decision-making, creating economies of scale and identifying new opportunities for creating destination-worthy groups. Also, owners of commercial facilities need to have a partner with the expertise to achieve crucial decarbonization goals.
- Managing and maintaining a large commercial facility, including its systems and infrastructure, can take time and effort. Therefore, many commercial space operators in the Philippines use a third-party facility management service provider instead of building their dedicated IT workforce, propelling the market growth in the segment. As per the Philippines Statistics Authority, the average commercial construction cost per square meter stood at USD 199.64, which insists that the players invest in construction activities, further driving the facility management market.
