Report

The Denmark Facility Management Market is expected to register a CAGR of greater than 1.4% during the forecast period.

Key Highlights
- Facility management (FM) consists of multiple disciplines to influence the efficiency and productivity of organizations. The new management system standard constitutes a benchmark for developing and driving effective strategic, tactical, and operational FM principles across Denmark.
- Facility Management Services across Denmark tend to be mature. With infrastructure development projects rising across the country for economic growth, allied FM services are also required. Hence, a Facility Management Standard that sets apart the industry by adapting global best practices and policies offers a win-win situation for FM organizations and customers in this country.
- Services in the FM industry have been commoditized to a great extent. Also, end users are very price sensitive, and contracts are thus aimed at shorter terms. A real estate over-supply has been creating pressure on rent yields, thus leading the customers to cut costs on FM services.
- As the construction industry gathers the benefits of digital transformation, a long-term approach to innovation has defined sectoral growth over the forecast period. Building infrastructure management and allied technological tools have been gaining momentum across construction, with multiple projects lined up for completion in the country.
- The Denmark government has been attempting to tighten many regulations on commercial activities in recent years. These laws are in place to protect both service providers and clients. The government has been tightening rules to close corporate restriction loopholes.
- The outbreak of COVID-19 had a mixed business impact on facilities management firms, as the restrictions on the movement of people resulted in a decline in project work and a reduced level of activity across many customer sites. Major players in the market, such as Mitie, CBRE Group, and others, were adversely affected due to the lockdown. After the pandemic, the market is growing rapidly with increasing emphasis on green building practices.


Denmark Facility Management Market Trends

Single Facility Management to Have a Significant Share


- Working with a single facility management service provider primarily delegates task management to separate entities. It also entails having a different service provider for each service the organization requires, such as one for cleaning, one for reception, and one for vending machines. Using specialized service providers has several advantages.
- It allows customers to concentrate on their core business, while single-service providers provide effective customer services and help operational efficiency. Experts handling task management would result in much higher efficiency and service quality. It would also free company employees to focus on the most important business areas while saving resources for non-core activities. According to Statistics Denmark, the private sector employs the maximum number of people in Denmark. In Denmark, approximately two million people were working in private enterprises as of the third quarter of 2022.
- Outsourced FM has been successfully used in various sectors, including the public sector, retail, professional services, healthcare, technology, logistics, manufacturing, and education. The areas that FM services look after vary widely, primarily depending on its type, the size of the company, and the sector in which it operates. Some organizations would only require a single service solution provider. Such demand is driving the single FM in the country.
- When businesses choose a single service provider, they outsource their day-to-day operations to a specialist provider. They can be assured of superior service quality and efficiency by hiring specialists. Using several service providers is a time-consuming activity that necessitates the management of multiple vendors and associated hazards. It helps create significant opportunities for the market vendors to expand single FM services in the country.
- In Denmark, FM vendors have been largely concentrating on improving their service offerings and establishing themselves as a single-point option for end-to-end FM services. Single service provision is relatively straightforward; a purchasing organization procures a single FM service from a supplier under a single service contract.


Commercial End-user Sector is Expected to Hold Major Share


- The commercial sector is one of the prominent segments that contributes a good share of facility management in Denmark.
- Denmark accounts for most of the development projects undertaken in the country's commercial sector. However, under the project Denmark Forward, the Danish government has proposed a new plan to spend around DKK 160 billion (~USD 23.056 billion) on infrastructure.
- The investments from the Danish government across a range of infrastructure and related commercial projects are also increasing the demand for facility management services in the commercial sector. According to the IMF, Denmark's government spending to gross domestic product ratio is expected to fall by 0.7 percentage points between 2022 and 2027. This general drop only occurs for a while, most notably in 2025 and 2026. In 2027, the ratio is expected to be 49.83 per cent.
- Moreover, the commercial sector covers office buildings occupied by business services, such as corporate offices of manufacturers, IT and telecommunication, finance and insurance, property, and other service providers. The rise in the IT sector across Denmark would allow more expansion in the commercial sector along with facility management services.
- Telecom players are focused on 5G deployments in Denmark, creating significant opportunities for the region's facilities management sector. For instance, in Feb 2022, Telenor Denmark announced that it plans to upgrade another 1400 masts to 5G throughout 2022, commence the deployment of a 5G standalone network, and shut down its 3G network and interconnect its masts and core network through fiber.


Denmark Facility Management Industry Overview

The Denmark Facility Management is moderately fragmented, with the presence of several players of different sizes. This market is expected to experience several mergers, acquisitions, collaborations, and partnerships as companies continue to invest in strategically offsetting the present slowdowns they are experiencing.

In June 2022, the University of Southern Denmark (SDU) consultancy firm K-Jacobsen, Signal Architects, and ISS collaborated with tech companies Ubiqisense and Enabled Robotics for an interdisciplinary innovation project, FacilityCobot. The project aims to develop a unique mobile robot that integrates a smart building sensor system with a human-robot interface and relieves cleaning staff from repetitive or physically exhausting tasks. Integrating the mentioned technologies would allow the robot to work efficiently with cleaning staff, especially in large open-space areas like canteens and offices.

In April 2022, CBRE announced a collaboration with Microsoft Corporation to deliver a considerably upgraded and unique portfolio of technology capabilities to major retailers and other firms with similar, distributed-site footprints. CBRE's existing fmPilot integrated retail facilities management solution would be transformed due to this partnership. The improved platform would significantly improve client outcomes, allowing them to establish greater communication between assets and technicians, increase operational performance, and realize material cost reductions.

Additional Benefits:

- The market estimate (ME) sheet in Excel format
- 3 months of analyst support