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Facilities Management Outsourcing – Health and Education Sector Report - UK 2018-2022

Published: 15/01/2018 / Number of Pages: 74 / Price: £845.00

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Introduction and Overview

The 5th edition of AMA Research's 'Facilities Management Outsourcing - Health and Education Sector Report - UK 2018-2022' offers a unique review of the market for outsourced management and delivery of non-core services with a specific focus on the Health and Education sectors.

Key issues analysed include:

  • Specific analysis of FM Outsourcing market within Health & Education - sector sizes & trends, key market influences, government expenditure plans & PFI/PPP, penetration of FM outsourcing, forecasts and potential opportunities.
  • Review of market structure and leading providers - changing supply structure, diversification of service provision and company profiles for the leading contractors within Health and Education sectors.
  • Overview of the broader UK FM outsourcing market - size, recent trends and key market influences, forecasts and future prospects.

Key areas of insight include:

  • Market size of FM Health & Education from 2012 to 2017 - with forecasts through to 2022.
  • Review of key FM contractors - including leading players, market position and major contracts.
  • Mix of in-house, single, bundled TFM service provision in the education and health sectors over the medium term.
  • FM market mix in Health and Education - recent growth rates and changing market mix.
  • Service mix - building & engineering maintenance, cleaning, catering and others.

Some of the companies included:

Amey Group, Apleona HSG, Aramark, Arcadis, Babcock International Group, BAM Facilities Management, Bellrock, Bouygues Energies & Services, Carillion, CBRE Group, City Facilities Management, Compass Group, Emcor UK, Engie UK, Eric Wright Group, Gardiner & Theobald, G4S Facilities Management, Integral UK, Interserve, ISS UK, Kier Group, Mitie, Serco Group, Servest, Skanska Facilities Services, Sodexo Group, The Capita Group, The OCS Group UK, Turner Facilities Management, Vinci Facilities, Mace Macro, Mears Group, Morgan Sindall Property Services, Parkwood Group, Pinnacle PSG, Robertson Facilities Management, Ryhurst, VolkerFitzpatrick.


FM Outsourcing within Health & Education

  • Overview of the overall FM Market - market definition in terms of sectors -total market size 2012-22 for bundled FM services - Review of FM Outsourcing market within Health & Education - estimates of market size from 2012-2017, with forecasts for 2018 to 2022.
  • Key market influences - capital expenditure programmes, increasing market maturity in the healthcare sector, construction output and developments within the PFI/PPP sector. Future opportunities and threats - e.g. Government encouragement of more collaborative arrangements and partnerships.
  • Penetration of Outsourcing in the Health and Education sectors - level of maturity, services outsourced, trend to TFM and bundled services.

Health Sector

  • The changing NHS estate: PFI/PPP, ongoing rationalization, establishment of NHS Property Services and Strategic Estates Partnerships (SEPs).
  • Service provision mix - in-house, singe, bundled, TFM contracts; mix share of services provided through outsourcing - cleaning, catering, building maintenance, portering, laundry etc.
  • End users of Bundled/TFM services - acute, mental health, primary care/GPs etc - mix of service provision within sectors - recent trends, future prospects.
  • Trends in private healthcare, dental groups, care homes - leading players by sector.

Education Sector

  • Review of major capital expenditure programmes: PFI/PPP, Priority Schools Building Programme (1 & 2), capital expenditure in higher education.
  • Service provision mix - in-house, singe, bundled, TFM contracts; and mix of services provided through outsourcing - cleaning, catering, building & engineering maintenance, grounds maintenance etc.
  • Facilities services costs - by sector. Service costs by education sector (primary, secondary) for cleaning, catering, building maintenance and ground maintenance, etc-
  • Estimation of the mix of end users and the services required in each sector.

Contractors Review

  • Key trends -recent acquisitions & mergers, divestments & disposals, market entrants, business failures, impact of market maturity, expansion and diversification of service provision, market polarisation.
  • Review of origins of FM companies and the supply structure.
  • Market shares and company profiles for leading FM providers to the Health and Education sectors covering over 40 major providers and niche specialists - includes overview of market shares, company size, growth trends, areas of specialization, sector strengths and major contracts.

Report Summary

Over the last few years, the potential for facilities management (FM) outsourcing within the healthcare and education industries has been limited, largely due to factors such as political and economic uncertainty, as well as cuts in many public-sector budgets and closure of facilities in both industries. Growth within the market for outsourced integrated services and TFM in health and education has therefore been on the modest side. In 2017, the market value was estimated to be 2% lower than in the previous year.

Market growth has been hampered by a decline in the number of large-scale projects undertaken - within the education sector, for example, the cancellation of the Building Schools for the Future (BSF) programme in 2010 had a serious impact upon demand for outsourced FM services. Although healthcare and education represent two of the largest Government departments in terms of PFI/PF2 activity at present, the number of schemes being signed off on a year-by-year basis is also declining due in part to the difficulty in obtaining finance from both private and public sources.

The healthcare and education sectors have experienced a gradual trend towards bundled service and TFM contracts, largely at the expense of single-service varieties. That said, single service contracts remain prevalent within certain market sectors, e.g. catering in primary and secondary schools. The growing adoption of bundled and TFM contracts has had a positive effect upon market value, since these tend to be higher priced.

The outlook for the FM outsourcing market within healthcare and education is considered moderately positive over the short to medium term. Although growth within both sectors is likely to depend upon the prevailing political and economic situation, Government encouragement of greater private sector involvement is expected to continue.


List of Contents

Contents Listing

  1. 1. INTRODUCTION 6
  2. 1.1 BACKGROUND 6
  3. 1.2 SOURCES OF INFORMATION 6
  4. 2. SUMMARY AND MARKET PROSPECTS 8
  5. 2.1 EXECUTIVE SUMMARY 8
  6. 2.2 MARKET PROSPECTS 9
  7. 3. ECONOMIC ENVIRONMENT 11
  8. 3.1 GDP 11
  9. 3.2 INFLATION & INTEREST RATES 12
  10. 3.3 UNEMPLOYMENT 13
  11. 3.4 HOUSEHOLD CONSUMPTION 13
  12. 3.5 HOUSING & CONSTRUCTION 14
  13. 3.6 STERLING 15
  14. 3.7 POPULATION PROFILE 15
  15. 3.8 CONCLUSIONS 16
  16. 4. FM IN THE HEALTH & EDUCATION SECTORS 17
  17. 4.1 FACILITIES MANAGEMENT OUTSOURCING MARKET 17
  18. 4.1.1 Definition 17
  19. 4.1.2 FM Market Size and Trends 17
  20. 4.2 HEALTH & EDUCATION FM MARKET DEFINITION 20
  21. 4.3 HEALTH & EDUCATION FM MARKET SIZE AND TRENDS 21
  22. 4.4 HEALTH & EDUCATION FM MARKET MIX 23
  23. 4.5 KEY MARKET INFLUENCES 24
  24. 4.5.1 Healthcare and Education Construction Output 24
  25. 4.5.2 Public Private Partnerships 27
  26. 4.5.3 Legislation 29
  27. 5. FM IN THE HEALTH SECTOR 33
  28. 5.1 HEALTHCARE FM MARKET SIZE AND TRENDS 33
  29. 5.2 SERVICES AND SERVICE PROVISION 37
  30. 5.3 END USERS 39
  31. 5.3.1 Acute Trusts 40
  32. 5.3.2 Clinical Commissioning Groups 42
  33. 5.3.3 Mental Health Trusts 43
  34. 5.3.4 Others 44
  35. 5.3.5 Private Sector 45
  36. 6. FM IN THE EDUCATION SECTOR 52
  37. 6.1 EDUCATION FM MARKET SIZE AND TRENDS 52
  38. 6.2 SERVICES AND SERVICE PROVISION 54
  39. 6.3 END USERS 55
  40. 6.3.1 Primary Education 56
  41. 6.3.2 Secondary Education 56
  42. 6.3.3 Tertiary Education 57
  43. 7. CONTRACTORS REVIEW 58
  44. 7.1 ORIGINS AND SUPPLY STRUCTURE 58
  45. 7.2 MARKET SHARES 59
  46. 7.3 COMPANY PROFILES 60
  47. 7.3.1 Leading Contractors in Health and Education 60
  48. 7.3.2 Other Leading Companies in the FM Market 67

Tables & Charts

  1. CHART 1: UK FM OUTSOURCING MARKET SIZE AND FORECASTS - HEALTH AND EDUCATION 2013 - 2022 (£BN) 8
  2. TABLE 2: GDP DATA - 2015-2017 - KEY CONSTITUENT ELEMENTS 11
  3. CHART 3: INTEREST RATES AND INFLATION (CPI) FROM 2000-2021 13
  4. CHART 4: PDI & SAVINGS RATIO AT CURRENT PRICES 2000-2021 14
  5. TABLE 5: EXCHANGE RATE FLUCTUATIONS 2013-2019 - STERLING TO THE DOLLAR, AND THE EURO, SPOT RATES 15
  6. CHART 6: UK BUNDLED FM OUTSOURCING MARKET AT CURRENT PRICES 2013-2022 (£ MILLION) 18
  7. TABLE 7: UK EDUCATION AND HEALTHCARE BUNDLED FM OUTSOURCING MARKET SIZE AND FORECASTS 2013-2022 (£M) 21
  8. CHART 8: HEALTHCARE AND EDUCATION FM MARKET MIX BY VALUE 2017 (%) 23
  9. TABLE 9: CONSTRUCTION NEW WORK OUTPUT 2012 - 2017 (£M CURRENT PRICES) - HEALTH AND EDUCATION 24
  10. CHART 10: NEW WORK OUTPUT FORECASTS 2017-2021 (£BN) AT CURRENT PRICES - HEALTH & EDUCATION 25
  11. TABLE 11: CURRENT PFI/PF2 PROJECTS ACROSS GOVERNMENT BY DEPARTMENT 2016 27
  12. CHART 12: NUMBER AND COMBINED CAPITAL VALUE OF PFI PROJECTS SIGNED ANNUALLY 2005 TO MARCH 2014 28
  13. TABLE 13: PROJECTED SERVICE PAYMENTS UNDER PFI/PF2 CONTRACTS - 2010/2011 TO 2020/2021 29
  14. TABLE 14: UK HEALTHCARE MARKET SIZE AND FORECASTS FOR BUNDLED FM OUTSOURCING 2013-2022 (CURRENT PRICES) 33
  15. TABLE 15: SIZE OF NHS ESTATE BY FUNCTION (SQ. M.) 2013-14 TO 2016-17 (GIFA, OCCUPIED/UNUSED, ETC) 34
  16. TABLE 16: ESTIMATED SERVICE MIX IN OUTSOURCED FM IN THE HEALTH SECTOR (CLEANING, BLDG & ENG, CATERING ETC) 2016/17 37
  17. CHART 17: SERVICE PROVISION MIX (IN HOUSE, BUNDLED, SINGLE ETC) BY VALUE 2016/17 (%) 38
  18. CHART 18: END USERS OF BUNDLED & TFM OUTSOURCING (ACUTE, MENTAL HEALTH, GPS ETC) MIX BY VALUE 2016/17 (%) 39
  19. TABLE 19: NHS TRUSTS PROFILE IN ENGLAND, 2015/2016 - 2016/2017 (NUMBER OF SITES) 40
  20. CHART 20: ACUTE TRUSTS - MIX OF SITES BY VOLUME (SUPPORT, GENERAL ACUTE, TREATMENT CENTRES, SPECIALIST, ETC) 2016/17 41
  21. CHART 21: ACUTE TRUSTS - MIX OF SERVICE PROVISION BY VALUE (IN HOUSE, SINGLE SERVICE, BUNDLED, TFM) 2016/17 41
  22. CHART 22: PRIMARY CARE - MIX OF SITES BY VOLUME (GPS, HOSPITALS, NURSING ETC) 2016/17 42
  23. CHART 23: GPS - MIX OF SERVICE PROVISION BY VALUE (IN HOUSE, SINGLE SERVICE, BUNDLED, TFM) 2016/17 43
  24. CHART 24: MENTAL HEALTH & LEARNING - MIX OF SITES BY VOLUME (TREATMENT CENTRES, GP, HOSPITALS, SUPPORT) 2016/17 43
  25. CHART 25: MENTAL HEALTH & LEARNING TRUSTS - MIX OF SERVICE PROVISION BY VALUE (IN HOUSE, SINGLE SERVICE, BUNDLED, TFM) 2016/17 44
  26. CHART 26: 'OTHER' TRUSTS - MIX OF SERVICE PROVISION BY VALUE (IN HOUSE, SINGLE SERVICE, BUNDLED, TFM) 2016/17 45
  27. CHART 27: PRIVATE ACUTE HEALTHCARE MARKET SIZE - % BY SECTOR (ACUTE HOSPITALS, NHS COMMISSIONING, MENTAL HEALTH) - (£BN) 2015-16 46
  28. TABLE 28: LEADING UK PRIVATE HOSPITAL PROVIDERS 2016/2017 - MARKET SHARES, NO. OF ACUTE HOSPITALS, BEDS 48
  29. TABLE 29: MAJOR DENTAL COMPANIES IN THE UK BY NUMBER OF PRACTICES IN 2012 AND 2017 49
  30. TABLE 30: LEADING 10 PRIVATE PROVIDERS OF LONG-TERM CARE - NUMBER OF HOMES - 2016/2017 51
  31. TABLE 31: UK EDUCATION BUNDLED FM OUTSOURCING MARKET 2013-2022 (£M) 52
  32. TABLE 32: FM SERVICE MIX IN EDUCATION (CATERING, BUILDING & MAINTENANCE, CLEANING, GROUNDS MAINTENANCE ETC) BY VALUE 2016/2017 54
  33. CHART 33: FACILITIES SERVICES COSTS IN EDUCATION (SECONDARY, PRIMARY, TERTIARY ETC) BY VALUE 2016/17 55
  34. CHART 34: FACILITIES SERVICES COSTS WITHIN PRIMARY SCHOOLS BY VALUE (CATERING, CLERICAL, BMI, CLEANING, GROUNDS ETC) 2015/16 56
  35. CHART 35: FACILITIES SERVICES COSTS WITHIN SECONDARY SCHOOLS BY VALUE (CATERING, CLERICAL, BMI, CLEANING, GROUNDS ETC) 2015/16 57
  36. TABLE 36: TOP 20 FM SUPPORT SERVICES COMPANIES IN THE UK 60

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