Nigeria Facility Management Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Nigeria Facility Management Market is expected to grow by registering a CAGR of 5.4% during the forecast period (2022-2027). The growing urbanization in the country is driving the demand for facility management services for proper maintenance of properties, especially commercial and industrial properties.

Key Highlights

• The increasing rate of urbanization in the country is driving the growth of the construction industry as the demand for both commercial and residential properties is increasing. For instance, in September 2021, Edo State government and Persianas Nigeria Limited signed an agreement for the development and construction of a shopping center in Benin City, the state capital.
• Increasing investment by the government to develop their public infrastructure is also supporting the growth of the construction sector in the country. For instance, in March 2022, the construction activity of a USD 537 million new consulate building, at Eko Atlantic City in Lagos was flagged off by the U.S. Embassy in Nigeria.
• Additionally, the country has also been witnessing increased investment in data center infrastructure owing to the rising demand for cloud solutions. For instance, in April 2022, Kasi Cloud Ltd. broke ground for the construction of a new data center in Lagos, Nigeria. The company has acquired approximately 4 hectares of land and is planning to invest around USD 250 million in the project.
• However, lack of awareness and skilled workforce along with the volatile economic condition are among some of the major factors holding back the growth of the studied market.
• Significant impact of COVID-19 has been observed in the country. The widespread lockdown along with decline in crude oil prices, which is a major source of revenue for the Nigerian government, stalled the construction activities. Additionally, the disruptions to supply chain and disruption in import activities of construction equipment and material further supported this cause. However, with the condition moving towards normalcy, the market is expected to gain traction, which in turn will drive the demand for facility management services.

Key Market Trends

Oil and Gas Sector to be a Major Demand Driver

• When compared to the African market, the oil and gas sector in Nigeria is among the largest. According to Nigerian National Petroleum Corporation (NNPC), the maximum crude oil production capacity of the country is about 2.5 million barrels per day.
• As several aspects of the petroleum industry, ranging from the exploration of the possible location of the reservoir up until decommissioning is subjected to several uncertainties and are affected by financial, operation and maintenance, government law, construction, and political and regulatory factors the role of facility management becomes even more crucial.
• To ensure the effective operation of the oil exploration sites and other related industries, the demand for facility management services is increasing in Nigeria. For instance, in November 2021, Seplat Petroleum Development Company, an independent oil, and gas company in Nigeria rolled out tenders for the Provision of Facility Maintenance Services for Sapele West Field Logistics Base (FLB).
• Such trends are encouraging more and more vendors to include services that can cater to the demand of this sector. For instance, Petrogap, a Nigerian company offers a comprehensive portfolio of facility management services for oil and gas sector which include integrated service package for Heat Exchangers & Subsea Control Systems, and Gas Turbines, as well as services such as maintenance, repairs and operation of platforms, drill sites, and processing plants.

Growth of ICT Sector to Drive the Demand for Facility Management Services

• Currently, the ICT sector in Nigeria is among the fastest-growing sectors in Nigeria and has emerged to be among the leading contributors to the country's GDP. For instance, according to the National Bureau of Statistics, in the first half of 2021, the ICT sector contributed NGN 5.5 trillion to the real GDP of the country.
• The presence of several tech companies such as IBM, Accenture, and Google is driving the demand for office spaces in the country, which is a major consumer for facility management services.
• Additionally, the growing consumption of digital solutions is encouraging new players to enter the market and is also supporting the growth of the local vendors operating in the ICT sector. For instance, in May 2021, Nigerian fintech startup Mono announced that it has closed over USD 2 million in seed investment to power the internet economy in Africa.
• In its drive to diversify the economy from oil and gas, the Nigerian Government recognizes ICT as the enabler for developing other critical sectors including healthcare, education, agriculture, and manufacturing and is encouraging partnerships between foreign investors and local ICT companies. Such trends are expected to lead to the creation of business environment that is more supportive to the growth of the facility management market in the country.

Competitive Landscape

The facility management in Nigeria is moderately competitive and is expected to grow in competition during the forecast period as the increasing awareness and demand are encouraging new players to enter the market. Some of the major players operating in the market include Total Facilities Management Limited, Greenkey Facility Management Services, Global PFI Limited, and Solid Rock Facility Management Company Limited.

• April 2022 - The Federal Executive Council (FEC) approved NGN 35 billion for various projects in the aviation sector. To maintain the nation's new international building terminals in Port Harcourt and Abuja, about NGN 5.6 billion of the money was approved.
• August 2021 - Global Property and Facilities International Limited (GPFI), a facility management company offering its services in Nigeria, secured contracts to provide integrated Facilities Management services for Heritage Mall, RIVTAF homes’ Golf Estate Port Harcourt, Ibadan, and Reckit Benkiser in Lagos.

Additional Benefits:

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

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