Market Trends of Taiwan Facility Management Industry
This section covers the major market trends shaping the Taiwan Facility Management Market according to our research experts:
Infrastructure Development Holds the Major Market Share
- As per the Report Published by DBS bank Outlook 2022, The government in Taiwan has set a firm 2050 carbon neutrality target. It has proposed introducing a carbon pricing mechanism by 2023, in the form of a low carbon tax for big emitters during the initial phase. Meanwhile, increasing the support for green investment in Infrastructure development. All these steps to acquire sustainability will drive the FM industry into the region to achieve the target of zero-emission.
- As per the National development council of Taiwan, the government is planning to use the fourth-stage budget for the Development of infrastructure projects, which include green energy, the internet of things, 5G, artificial intelligence, and cybersecurity, closing the gap between urban and rural Development.
- The third phase of the infrastructure plan allocated was NTD 229.83 billion for 2021 and 2022. As per the NDC, NTD 124.06 billion was set aside for 2021, of which 92.27% had already been used by December on several projects, including installing air conditioners in most school classrooms, improving water supply infrastructure, and subsidizing 5G connectivity, projecting an important role of FM industry for the Future Development of the region.
- In April 2022, at the Asia silicon valley expo, The Zhonghua System Integration announced the launch of four primary application services: smart factories, AR augmented reality, intelligent detection, and drones. It also exhibits the 5G smart long-term care service in the world's first smart glasses first-view solution that combines AIoT, 5G private network, and AR technologies for making all these projects a reality as well as after the completion of the project facility management services will play a crucial role for managing the building structure.
- The ongoing projects reflect the call for FM services innovation in adapting technologies. FM services providers in Taiwan will undergo a significant transformational journey to accelerate digital growth. With all these transformations in infrastructural Development in the region, it is evident that the role FM industry will be crucial in Taiwan.
Understand The Key Trends Shaping This Market
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Commercialization and Urban Development will Hold the Key to Market Growth
- The strong export demand in Taiwan leads many local corporates to purchase facilities and industrial land for future expansion. Several local manufacturing companies reportedly plan to raise CapEx, implying the continuation of buying in the industrial sector, raising more demand for Facility Management services to look after the offices and properties.
- As per the CBRE report on Taiwan Real Estate Market Outlook 2021, the solid Taipei office leasing market will continue attracting institutional and private investors to seek investment opportunities. Yields for retail properties in Taipei are expected to rise to 3.65% this year as sellers come under pressure to cut asking prices amid weak investor interest. Retail assets with redevelopment opportunities are more likely to attract buyers, creating new sources of revenue for FM companies in the region.
- Owner-occupiers will retain a strong appetite for industrial assets located in major industrial parks in Northern Taiwan. This will see industrial yields contract to around 3.6%, a level below retail properties.
- As per the CBRE report on Taiwan Real Estate Market Outlook 2021, FY2021 is another strong year for the real estate investment market on the back of abundant liquidity and positive investor sentiment. CBRE's Asia Pacific Investor Intentions Survey, conducted in Q4 2020, found that 71% of Taiwanese respondents intend to buy more real estate in 2021, which inherently attracts more FM businesses across the globe to manage all these properties across the country.
- As economic fundamentals continue to strengthen, landlords in significant shopping areas are reluctant to reduce rents. High street rents in Taipei are expected to stabilize throughout 2021. According to the report published by CBRE, stabilization in rents for commercial properties will allow companies to spend more on other necessary facilities like cleaning, office maintenance, electrical maintenance, etc., boosting the FM industry in the region.
