Malaysia Facility Management

Malaysia Facility Management Market Research Report: Forecast (2023-2028)

By Type (Hard Services, Soft Services, Risk Services, Administrative Services), By Operating Model (In-House, Outsourced), By Service Delivery (Single, Integrated, Bundled), By End Users (Commercial, Read more

  • Buildings, Construction, Metals & Mining
  • Jan 2023
  • 103
  • BM44042

Market Definition

Facility Management (FM) is a service that brings efficiency to managing a building or a facility with a professional discipline by focusing on delivering effective support services for the functionality, safety, and sustainability of the buildings. The vast variety of services that are secondary for organizations, such as cleaning, catering, building & energy management, fitment & repair of electrical installations, etc., come into this category.

Market Insights

Malaysia Facility Management market is projected to grow at a CAGR of around 5.67% during the forecast period, i.e., 2023-28, owing to the government's goal to develop smart cities & expand the tourism industry, a rise in warehouses due to the growth in e-commerce, etc. The need for facility management in the country has surged as a result of the expanding development of smart cities projects in Sabah and Sarawak, which have been promoting consistent smart city efforts by improving their public services & management systems using digital solutions.

Report Coverage Details
Study Period Historical Data: 2018-21
Base Year: 2022
Forecast Period: 2022-27
CAGR (2023-2028) 5.67%
Key Companies Profiled JLL Facility Management, AWC Berhad, Sepadu Group, Harta Maintenance Sdn Bhd, Zelan AM Services Sdn Bhd, PMC Facilities & Real Estate,  CBRE, RPH Global Property Management, KLCC Property Holdings Berhad (KLCCP), MST Facilities Sdn Bhd, Others
Unit Denominations USD Million/Billion

 

Infrastructure development & maintenance in smart cities could be expensive & challenging. As a result, using facility management during the construction phase is critical to ensuring the functionality and usability of the buildings. However, neglecting these services would lead to long-term effects on the sustainability of cities. Thus, the country's growing development of smart cities has positively impacted the Facility Management market.

Moreover, Malaysia is a developing country that invests in a variety of sectors to strengthen its economy, ranging from agriculture & community-based to robust manufacturing & service sectors. Malaysia ranks 55th out of 157 countries in the World Bank's Human Capital Index, with significant growth in the educational, commercial, and healthcare industries. As a result, the demand for soft & hard facility management has grown in both the commercial & educational sectors.

Furthermore, rising Foreign Direct Investment (FDI) is a major contributor to investment in the country for infrastructural development. The country's FDI accounts for about 70.9% of approved investments with an approximate value of USD19.5 billion, which has become the primary reason for attracting new projects, resulting in rising demand for facility management in recent years.

Key Trend in the Market

  • Escalating Use of Artificial Intelligence (AI) & Internet of Things (IoT)

The heightened integration of technologies such as artificial intelligence (AI), internet of things (IoT), robotics, etc., in recent years, to enhance performance along with effectively managing documentation & ensuring a high level of satisfaction is supporting the growth of the market.

The integration of AI algorithms helps the organization reduce the cost of operations of HVAC, security, and other systems, which further increases their efficiency. Additionally, AI can be used for space optimization & space planning of organizations based on the number of employees, sensors, and usage of previously available data.

Therefore, the rising adoption of AI & IoT technologies by FM companies has been largely reducing human errors in building operations & improving overall security protocol, due to which the demand for such facility management services has been improving in recent years and is estimated to continue in the coming years.

Market Segmentation

Based on Type:

  • Hard
  • Soft
  • Risk
  • Administrative

The Malaysia Hard Facility Management market saw an upward trend during 2018-19, which was supported by the burgeoning construction of building infrastructure, especially for residential, energy, and commercial sectors resulting in an elevation of hard facility management services in the country. Malaysia's government is working to improve the country's tourism industry. In 2020, the Malaysian government launched the National Tourism Policy (NTP) as a roadmap for supporting the country's tourism industry until 2030.

Moreover, a surge in the proportion of investors in the broader market would benefit Malaysia's hospitality industry. Thus, the requirement for hard services, such as plumbing, electricity, lighting, air conditioning systems, HVAC systems, and others, is expected to rise in Malaysia. Owing to the expanding construction & development of the tourism sector, BFSI, and small businesses as hard services are a basic need for any commercial building.

Based on Service Delivery:

  • Single
  • Bundled
  • Integrated

Integrated services held a sizable market share during 2018-2021, owing to their lower total contract costs and the ability to access several services under a single contract. Also, the country's expanding development in a number of industries, including business, retail, healthcare, and hospitality, has been a key element in the expansion of integrated services in the market.

Moreover, the bundled services represented a substantial share of the Malaysia Facility Management market. Multiple property management services, including soft, physical, and administrative, are incorporated in bundled services. These services are mainly used by industries like commercial, retail, healthcare, hospitality, etc. since they lower the cost of individual services and streamline communication, which also enables better building management on a limited budget. With the growing investments and construction in these sectors, the requirement for facility management services is also gaining traction in the country.

Based on the Operating Model:

  • In-house
  • Outsourced

Outsourced services have witnessed considerable growth in the Malaysia Facility Management market during 2018-22. The improved management of assets & other services, such as security, cleaning, catering, etc., across various end-user sectors has been the main driver pushing the demand for outsourced services in the country. These services assign work to the employees on a contractual basis, thus implementing outsourced facility management services improves operations' reliability & efficiency while also allowing management to focus on the company's crucial strengths & risky goals.

Besides, the In-house Facility Management market experienced a nominal share in the country, attributed to the high monitoring costs, limited service portfolio, low customer satisfaction, lack of management effort, and poor service quality. In addition, the overburden of activities results in the overlapping of roles due to the limited number of employees in the in-house operating model leading to inefficiencies in maintaining the organization better.

Based on the End Users:

  • Commercial
  • Residential
  • Government
  • Retail
  • Education
  • Healthcare
  • Hospitality

During the historical period, the Commercial sector held a considerable share of the Malaysia Facility Management market. The market growth imputes to the growing number of commercial projects, such as the Bayan Lepas railroad project, among others in the country. According to PDC (Penang Development Corporation), Bayan Lepas has become a major attraction for investors, to launch different ventures in the city.

Hence, with the burgeoning investments in the expansion of commercial units across the country, owing to the ease of availability of migrant labor, low energy costs & labor costs are the prominent reasons that would enhance the growth of the market in the forthcoming years.

Recent Developments by Leading Companies

  • 2022: AWC Berhad announced a tender to support facility management service for Kanser Negara Institute, which has been accepted by the Ministry of Health. The contract is worth USD43 million, contributing positively to the earnings of the AWC Group over the 5 years.

Market Dynamics:

Key Driver: Growing Financial/Banking Sector & Strong Institutional Sector  

Malaysia’s educational sector has been noticing a surge in growth in recent years, intending to enhance its economy as the 2020 vision of Malaysia supported the development of the nation towards a fully industrialized country through the education sector. Further, to accomplish this vision, in 2020, the Malaysian Investment Development Authority (MIDA) invested in private higher secondary educational institutions in Malaysia to construct new universities & schools. The country’s main vision is to close the gap in skill set among the students & nurture them to industry-ready talents that can thrive in the world of IR4.0 technologies.

Hence, such development helps the country to improve the quality of infrastructure spending by providing high-quality technical assistance such as energy management, building management, etc. Further, the plan encouraged the development of infrastructure facilities, improving water sanitation services, efficient energy management, production, etc., which led to elevated demand for facility management services in the forthcoming years.

Possible Restraint: Lack of Skilled Labor in Malaysia to Hinder the Market

The lack of a skilled workforce in Malaysia has constrained the growth of the facility management services in the country, owing to the technical skills required for upgrading & maintaining large systems such as HAVC systems & other hard services. Furthermore, the emergence of smart HVAC systems such as AI-enabled systems involving the use of sensors & smart thermostats, owing to the technological evolutions & development in the industry.

However, these services required specialized technicians and a skilled & certified workforce in the country. As a result, the lack of skilled workforce in facility management companies to provide proper services impedes market development in the coming years.

Growth Opportunity:  Malaysia Renewable Energy Targets to Escalate Market Growth in the Coming Years

The growing number of renewable energy targets in the country is to reduce its greenhouse gas emission intensity of GDP by up to 45% by 2030 by implementing clean, sustainable, and renewable energy (RE). This would surge demand for facility management services in the coming years. Further, Malaysia Renewable Energy Strategy 2025 aims to produce renewable and clean energy sources to meet the country’s environmental goals is supporting energy sector start-ups.

Moreover, the government's plan to support the decarbonization of the electricity sector in Malaysia through the 2035 milestone and rising investment in clean & renewable energy sources has been supporting the establishment of new energy start-ups in the country, which are further expected to create an opportunity for FM services in the forecast years.

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Frequently Asked Questions

A. The Malaysia Facility Management Market is projected to grow at a CAGR of around 5.67% during 2023-2028.

A. Hard Facility Management would be the most dominant service in the Malaysia Facility Management Market during 2023-28

A. The growing financial/banking sector & strong institutional sector is expected to drive Malaysia Facility Management Market during 2023-28.

A. JLL Facility Management, AWC Berhad, Sepadu Group, Harta Maintenance Sdn Bhd, Zelan AM Services Sdn Bhd, PMC Facilities & Real Estate, CBRE, RPH Global Property Management, KLCC Property Holdings Berhad (KLCCP), MST Facilities Sdn Bhd, are the top players in Malaysia Facility Management Market during 2023-2028.

  1. Market Segmentation
  2. Introduction
    1. Product Definition
    2. Research Process
    3. Assumptions
  3. Executive Summary
  4. Macroeconomic Outlook
  5. Malaysia Facility Management Market Porters Five Forces Analysis
  6. Malaysia Facility Management Market Supply Chain Analysis
  7. Malaysia Facility Management Market Trends & Insights
  8. Malaysia Facility Management Market Dynamics
    1. Drivers
    2. Challenges
  9. Malaysia Facility Management Market Growth Opportunities & Hotspots
  10. Malaysia Facility Management Market Policy & Regulations
  11. Malaysia Facility Management Market Outlook, 2018-2028F
    1. Market Size & Outlook
      1. By Revenues (USD Million)
    2. Market Share & Outlook
      1. By Type
        1. Hard Services
        2. Soft Services
        3. Risk Services
        4. Administrative Services  
      2. By Operating Model
        1. In-House
        2. Outsourced
      3. By Service Delivery
        1. Single
        2. Integrated
        3. Bundled
      4. By End Users
        1. Commercial
        2. Residential
        3. Government
        4. Retail
        5. Education
        6. Healthcare
        7. Hospitality
        8. Others (Oil & Gas, Mining, etc.)
      5. By Enterprise Size
        1. Large
        2. Mid-Size
        3. Small
      6. By Region
        1. North
        2. South
        3. East
        4. Central
        5. Sarawak
        6. Sabah
      7. By Company
        1. Market Share
        2. Competition Characteristics
  12. Malaysia Hard Facility Management Market Outlook, 2018-2028F
    1. Market Size & Outlook
      1. By Revenues
    2. Market Share & Outlook
      1. By Type
        1. District Cooling
        2. Building Management
        3. Plumbing Apparatus, Pumps, Sanitary units, etc.
        4. Electrical Installation
        5. Energy Management
        6. Air Conditioning System
        7. Roads & Street Lighting System
        8. Others
      2. By Operating Model
      3. By Service Delivery
      4. By End User
      5. By Enterprise Size
      6. By Region
  13. Malaysia Soft Facility Management Market Outlook, 2018-2028F
    1. Market Size & Outlook
      1. By Revenues
    2. Market Share & Outlook
      1. By Type
        1. Cleaning Services
        2. Catering
        3. Pest Control
        4. Landscaping
        5. Others
      2. By Operating Model
      3. By Service Delivery
      4. By End User
      5. By Enterprise Size
      6. By Region
  14. Malaysia Risk Facility Management Market Outlook, 2018-2028F
    1. Market Size & Outlook
      1. By Revenues
    2. Market Share & Outlook
      1. By Type
        1. Insurance Management
        2. Security
        3. Disaster Management
        4. Reserve/Sinking Fund
        5. Others
      2. By Operating Model
      3. By Service Delivery
      4. By End User
      5. By Enterprise Size
      6. By Region
  15. Malaysia Administrative Facility Management Market Outlook, 2018-2028F
    1. Market Size & Outlook
      1. By Revenues
    2. Market Share & Outlook
      1. By Type
        1. Mail Management
        2. Front Office Management
        3. Space Planning & Management
        4. Inventory Management
        5. Others
      2. By Operating Model
      3. By Service Delivery
      4. By End User
      5. By Enterprise Size
      6. By Region
  16. Malaysia Facility Management Market Key Strategic Imperatives for Growth & Success
  17. Competitive Benchmarking
    1. Competition Matrix
      1. Product Portfolio
      2. Target Markets
      3. Target End Users
      4. Research & Development
      5. Strategic Alliances
    2. Company Profiles (Business Description, Product Offering, Strategic Alliances or Partnerships, etc.)
      1.    JLL Facility Management
      2. AWC Berhad
      3. Sepadu Group
      4. Harta Maintenance Sdn Bhd
      5. Zelan AM Services Sdn Bhd
      6. PMC Facilities & Real Estate
      7. CBRE
      8. RPH Global Property Management
      9. KLCC Property Holdings Berhad (KLCCP)
      10. MST Facilities Sdn Bhd
      11. Others
  18. Disclaimer
Malaysia Facility Management Market Segmetation