Just when people thought the Real Estate sector was saturated, yet again rising from the ashes like a phoenix, the real estate sector has shown why it is the second-largest employment generator in India after agriculture. The new poster boy of real estate emerged to be the facility management industry. Not just in terms of novelty but simply on the sheer size of its market, it is the cynosure of the eyes of entrepreneurs. Though the Indian facility management accounts for a mere 3.2% of the GDP, the market capitalization stands at an astronomical volume of Rupees 5 lakh crore in the entire Indian economy. But wait, this is just the start, and estimates say it is expected to grow at 20-25% annually, which shows that sky is the only limit for the facility management industry.
Now that we know who the new real estate star is, let us dive deep and understand bricks and mortar of facility management. So what exactly do we mean by facility management? In simple terms, after any real estate project is completed, say an office space or a mall or any commercial building etc., professionally maintaining them is what facility management is all about.
Now coming to the million-dollar question, why will it be the next big deal? The industry is still nascent, with hardly a few organized players leading the way. Well, you might say, what is the big deal, as every industry has its prospects. But regarding facility management, the current numbers are testimony to its bright future. Currently, the present value of the facility management service stands at Rupees 50 thousand crores. It is expected to hit Rupees 1.25 lakh crore within the next 12 months.
Now that we know the numbers, let us see where the money will come from. While the global standards of facility management penetration stand at 49%, Indian facility management has only penetrated 25% of the real estate space. This means a whopping 75% of the market share is still there for the industry to leave its imprints on, which accounts for the lion’s share, rocketing the industry’s prospects sky-high.
So what is the function of facility management? Facility management can be classified into two categories: Hard Facilities Management Services and Soft Facilities Management Services.
As the name suggests, Hard Facility Management includes the hardcore maintenance of machinery, sewage treatment plants, rainwater harvesting, etc. Functions like security, housekeeping, and waste management, which involve service elements, are regarded as the soft services of facility management. So what are the future trends in facility management?
The facility management industry is not just all about simple tinker and plaster. Still, it helps companies meet stringent quality standards and compliance issues relating to environmental health and safety (ISO 9001 & 14001 and OHAS 180001).
The global players, along with the domestic ones, have invested in the Indian facility management service sector, which delivers on par with world standards. The rising costs, time and effort in maintaining a property make many in-house facility maintenances outsourced to dedicated facility management companies. In short outsourced facility management service will be the way forward with high standards and cleanliness earmarked with thoroughbred professionalism.
All this means more employment opportunities as well. There will be a need for trained and qualified resources and dedicated professionals who will be needed to adapt to the global engineering standards and best practices in facility management.
So is there more to this growth story?
The Indian facility management has too many factors in its favour, and here we list just a few of them.
Finally, Facility Management is the growth and the future. It has the best prospects for the real estate industry in the coming years.