Economy of Bahrain witnessed a boom during the review period, wherein GDP of the country increased at a CAGR of ~% between 2011 and 2013. Owing to the changing lifestyle and improved living standards, the population demanded more facilities services, which in turn raised the revenues of the market players by offering diversified portfolio of hard and soft services. Monetary support extended by the neighboring countries to invest USD ~ billion in mega-projects in Bahrain through the Gulf Development Fund (GDF), further led to increased construction and infrastructural developments in the country. This impacted the country’s FM market in a positive manner. The continuous growth in the construction sector due to the increased number of tenders provided by the government for infrastructural developments in the country was the major reason responsible behind the surged demand for facilities management services.
Facilities management market in Bahrain increased to USD ~ million in 2016 from USD ~ million in 2011, marking a robust CAGR of ~% during the same period. As per the Bahrain Economic Development Board (EDB), the total value of projects tendered grew from USD ~ billion in the fourth quarter of 2014 to USD ~ billion in 2015, increasing further to USD ~billion by the beginning of March 2016. The overall value of the construction projects reached to USD ~ billion in August 2016, thereby making facilities management market players cater to the growing sector of the country. Expanding manufacturing sector also assisted facilities management market players to increase their customers and add to their revenues during the 2011-2016.
Which Facilities Service Type generated the Maximum Revenue for Bahrain Facilities Management Market?
Infrastructural developments in Bahrain have impacted the facilities management market revenues in a positive manner as the growing sectors demanded resources for both technical and non-technical operations. Higher expenditure is incurred by the customers in opting for such advanced services, thus making this segment dominate the market with ~% revenues of facilities management services in 2016.
Soft services offered by the facilities management companies in Bahrain include offering manpower for cleaning, pest control, waste management, landscape access, archive management and other housekeeping services. Such services collectively contributed ~% to the overall facilities management market revenues in the country in 2016. Majorly driven by the soaring leisure and hospitality industry in Bahrain, which requires personnel for various services including cleaning, landscaping, security, reception services, valet services, concierge and other janitorial services, this segment has witnessed a growth in 2016.
Which Among Integrated, single and Bundled services has the Highest Revenue share in the Overall Market?
Market players offering facilities management services in Bahrain majorly operate as single service providers, owing to the limited demand for FM services as compared to other countries in the GCC. Single services include a typical service which can either be hard or soft, to meet the requirements of the customers. Since facilities management companies catered to specific requirements of clients with their expertise services, this segment dominated the market with a revenue share of ~% in 2016.
Integrated services involved offering various hard and soft services to the client under one contract. This segment added ~% to the overall facilities management market revenues in Bahrain in 2016.
With the least share of the FM market revenues in Bahrain in 2016, companies operating in the space contributed ~% during the same year. Bundled services are demanded by industries which have a need for a particular combination of few hard or soft services to carry out their processes in a smooth manner.
Which Among Outsourced and In-House Facilities Services generated the maximum Revenue in Bahrain Facilities Management Market?
In order to serve customers with the facilities management services and to retain them, market players opted to collaborate or tie up with third parties, which can provide them with the resources that were not available with the contractors. This process of outsourcing was typically meant for offering specialized services or in case of higher demand, wherein market players could not serve the existing customer base with their in-house resources.
Outsourced facilities management services added a significant share to the revenues of the overall market in 2016. Market players were able to contribute the majority share of ~% to the facilities management market revenues during the same period.
Proving particular services in which the company specializes and availability of limited resources with one service provider restricted the revenues earned through in-house services. This made companies generate a lower revenue share of ~% in the overall FM market of the country in 2016.
How are Increasing Mergers and Acquisitions Impacting Bahrain Facilities MANAGEMENT mARKET?
The growing economy of Bahrain is witnessing an increase in the number of acquisitions and joint ventures among the facilities management companies in the country. This is due to the rapid infrastructural developments in the country that the rising demands for facilities management solutions has made companies join hands with other existing and new market players. In 2013, Bahrain Airport Company (BAC) fully acquired Hochtief Facility Management Bahrain (HTFMBA), which was earlier a joint venture between BAC and Hochtief. The newly formed company is entirely responsible to serve the facilities management needs of the international airport in Bahrain, wherein it looks after all kinds of hard and soft service requirements in the airport premises. Several other players in the FM market of Bahrain operate in the form of a joint venture to expand their customer base and geographical reach in various regions of the country. Morganti Eddison and Mannai Holding also operate as a joint venture facilities management company of kingdom of Bahrain Morganti Facilities Management which provides fully integrated facilities management solutions both inside and beyond the geographical boundaries of the country.
What is the Expected Future Outlook for Bahrain Facilities Management Market?
Growing demand for facilities management by the tourism and hospitality industry of Bahrain is anticipated to fuel revenues generated by facilities service providers in the country. The revenues generated by facilities management market in Bahrain are projected to increase to USD ~ million during 2019 from USD ~ million during 2016, at a robust CAGR of ~% during this period. The initiative taken by the government to allocate USD ~ billion in 2016 budget for special infrastructure projects is expected to raise the demand for facilities management market players by the developers in the country. The projects include a new bridge to connect the Northern Governorate to Manama, flyovers, new hospitals, clinics, housing projects, and new roads. The opening up of a number of five star hotels and retail centers in 2017 are also anticipated to boost the market, typically that of soft services during the review period.
The revenues generated by facilities management market players in Bahrain are projected to augment to USD ~ million by 2021, registering a CAGR of ~% during the period 2016-2021.
Rapid development in the country is expected to raise the demand for FM market players, which are limited in Bahrain. Higher demand in contrast to the service providers will restrict the revenues of the market during the outlook period. Planned projects of the government in line with its Vision 2030 development plan, to boost the construction, infrastructure, real estate and manufacturing sector of Bahrain are further anticipated to augment the revenues earned by market players in the long term. The growing demand for soft services in the form of janitors and concierge services are projected to be the major reason towards the growth of facilities management market revenues.
Ken Research
Ankur Gupta, Head Marketing & Communications
ankur [@] kenresearch.com
+91-9015378249
www.kenresearch.com
