No way in

The construction boom has grown without restraint for several years, as shown by the properties which have to be managed. But no new players are appearing on the FM market. Has the cake already been divided with newcomers resigned to eating the crumbs?

Interest in the construction and development sector continues unabated. New investors and developers, foreign companies and those from other industries are appearing almost daily. Openings of new buildings take place almost every day, cornerstones are being laid and ribbons cut. But having said that, it must be noted that the last facility management company claiming to hold a significant property portfolio started operations on the Polish market more than 2 years ago.

Competing

in two leagues

Izabela Mucha, a property manager at Cushman & Wakefield, and also a board member of the Polish Federation of Property Managers Associations, claims that: “It is said that two kinds of companies offering FM services and dealing in FM management are currently active on the Polish market. The first perform specific services such as cleaning, security, technical maintenance, catering etc, while the second type supervises and streamlines the quality of services in the owner’s name.”

In sports terms it could be said that two leagues have appeared in the FM industry:

– A world league of ‘global players’ – teams which can be counted on the fingers of one hand, with this group having remained unchanged for many years,

– A league of ‘small local teams’ – either managing one property and employing the services of subcontractors mainly chosen by a property’s developer or owner, or geared to performing highly specialized services in several buildings.

According to Bartłomiej Śliwiński, a real estate management lecturer at Warsaw University and Foundation Facility Management member: “This is the situation the whole world over. To win a position in the FM and PM industry means years of building a reputation and a prolonged process of convincing people about a company’s professional skills.”

No dark horses

to bet on

The largest property portfolios and the most lucrative contracts – in other words, the tastiest pieces of the cake – have been divided among a few ‘tycoons’, with the names of the same companies appearing infrequently in releases about new contracts signed. Why does their position seem so safe?

In the opinion of Izabela Mucha of Cushman & Wakefield: “Not every company is ready to supply such comprehensive management services. I feel that FM management, which is still not fully appreciated, is one of the most complex professions on the market, since it focuses on a huge range of services.” (see table)

Maciej Skórski, Sodexho Polska’s development director, adds that: “Customers tend to trust a larger services renderer, more experienced and with credible references, since the choice of the supplier of FM services is a strategic decision for each board which will shape company results for many years to come. That is why the greatest successes are achieved by FM companies which possess a wide offer shaped to a customer’s requirements and profile with cooperation founded on partnership relations.”

Therefore, gaining promotion for a small company from the second to the first FM league is no easy task, since it requires substantial expense and long-lasting evolution. But why are no new western corporations with appropriate means and know-how appearing in Poland, well adapted to combat on the Polish national market?

Bartłomiej Śliwiński of Warsaw University thinks many FM players feel East European markets are not yet sufficiently attractive “due to the relatively lower level of customer awareness of rendered services and the very low prices offered. ‘Majors’ prefer markets where properties are treated as a strategic reserve with the principal competition factors being quality, security and rapid reaction linked with specialist know-how.”

Long-term contracts between the largest investors and management firms are also a formal or informal open secret. FM specialists are brought into the picture at the property design stage to offer advice and opinions on specific technical solutions, and to assume manager duties once the investment is concluded. This is good since the FM company can get to know all the ins and outs of the investment. But it is also quite improper since other companies have no opportunity to win the contract so foreign firms refrain from doing business in Poland.

Young wolves look

for prey

A mere 2-3 years ago companies were complaining about the lack of educated facility managers, forcing them to educate their own people, introducing them to the trade themselves. It should be remembered that the first Polish academic FM handbook was published as late as 2006. Luckily, colleges have sensed a boom situation and are almost in step with market requirements.

Paula Stojanow, team leader of Hays personnel recruitment agency’s construction and property division, claims that: “Despite this, the facility managers labour market is an employees’ market, as is the entire investment industry. They can pick and choose offers and try to dictate conditions to employers. As we see it, the greatest demand for such specialists is in the shopping property segment, with offices next, followed by other industrial buildings.”

Since the principal players are reaping an increased crop of contracts, they have to employ a rising number of workers and are able to make use of almost any number of freshly graduated, chartered managers.”

Education ad nauseam

So what is happening to the FM boom? Any kind of prognosis only makes you shiver, since all previous forecasts predicting that prosperity is merely a short step around the corner, just flopped. The experts are unanimous – further education is what is required by those who are looking for these services. That may sound frivolous since FM is a concept which has been known in Poland for more than 10 years.

Izabela Mucha claims that: “Those who believe prophets hope a boom is in the offing, while those who do not are convinced the prophecies should be amended a little, changing certain longstanding habits, rules and principles which guide service renderers. And this is easier said than done. Globalisation, technical progress and global competition are forcing companies to expand, the functioning of which is becoming increasingly complex. The expectations of their workers are rising, as well as the costs of space and maintenance costs. This is the reason why the awareness is increasing that buildings, equipment and conveniences are an essential part of a company’s resources and constitute a substantial portion of current expenses.”

Bartłomiej Śliwiński concurs with this picutre: “The factor which determines the growth of that market for global players is the transformation in perceiving a resource which a property is, noting the impact of FM on organisational efficiency. The trouble is that the transformation is proceeding much too slowly in Poland, hence the absence of the forecast boom”.

Tomasz Cudowski