Facility management is a cornerstone of the Gulf Corporation Council’s (GCC) rapidly expanding built environment ecosystem, particularly as Saudi Arabia and its neighbors implement ambitious national transformation programs. With more than US$1.5 trillion committed to non-oil infrastructure between 2024-35, giga-projects are redefining the scale and complexity of asset operation and maintenance.

International FM literature has extensively examined digital transformation, smart buildings and sustainability. However, limited research addresses the combined effects of digitalization, aggressive localization policies and giga-project scale in high-growth emerging markets such as Saudi Arabia. In particular, the interaction between smart technologies, long-term performance-based contracts and workforce nationalization remains underexplored.

This study adopts a systematic qualitative synthesis approach inspired by and aligned with the logic of PRISMA-ScR guidelines. Thirty high-quality sources published between 2019 and 2025 were selected according to the following inclusion criteria:

  • Primary geographic focus on Saudi Arabia and/or GCC states

  • Provision of empirical data, market forecasts, regulatory insights or giga-project technical specifications

  • Publication by reputable academic journals, leading consultancy firms or official government entities

InfoGraph-01-19 SmartFacilities-FarooqSources were identified via Scopus, Google Scholar and industry databases such as MEED Projects, MarkNtel Advisors and Mordor Intelligence. Reference snowballing was used to capture additional relevant material. Data triangulation was applied to validate key forecasts, regulatory milestones and technology trends across multiple independent sources.

The findings are organized thematically into market growth, integrated FM models, smart technologies, sustainability, workforce localization, regulatory developments and emerging risks, which together provide the basis for the discussion and recommendations.

Findings

Growth forecasts for FM in Saudi Arabia and the GCC

Across all major market studies, FM in Saudi Arabia and the GCC is projected to grow at above-global-average rates. Table 1 consolidates the most frequently cited market size estimates and compound annual growth rate (CAGR) ranges.

Region

Market Size 2024 (USD bn)

Forecast 2030–2035 (USD bn)

CAGR (percent)

Saudi Arabia

32–35

60–65 by 2032

7.2–13.1

GCC aggregate

78

135–150 by 2030–2033

6.8–10.5

Tourism and entertainment assets account for approximately 30 percent of new FM demand, followed by health care clusters (22 percent) and logistics hubs (MarkNtel Advisors, 2024b). These verticals are heavily represented within giga-project portfolios, reinforcing the strategic role of FM in enabling national diversification.

Transition to integrated FM models

FM procurement in the GCC has shifted decisively from fragmented, single-service contracts to integrated FM (IFM) and total facility management (TFM) structures. Public investment fund (PIF) entities and master developers increasingly favor IFM to achieve life cycle cost optimization, improved coordination across hard and soft services, and single-point accountability for service outcomes.

Tender documents for giga-projects now commonly require bidders to demonstrate capabilities in multi-service integration, digital service delivery and performance-based contract management, rather than purely labor-supply models.

Emergence of smart FM technologies

Smart FM capabilities are expanding rapidly, supported by IoT sensor networks, integrated building management systems, AI-driven fault detection and diagnostics (FDD), and building-level and district-level digital twins. NEOM’s technical specifications, for example, mandate digital twin integration and continuous data exchange for core assets.

Pilot deployments at King Abdullah Financial District report 30-45 percent reductions in unplanned downtime and improved asset reliability through AI-enabled FDD. Red Sea Global has also embedded smart FM technologies into its sustainable operations framework to support predictive maintenance, energy optimization and enhanced guest experience.

FMJ Extra-01-19 SmartFacilities-FarooqSustainability & the Saudi Green Initiative

Sustainability has moved from a voluntary corporate initiative to a regulatory and contractual requirement. Under the Saudi Green Initiative and related policy instruments, all new public buildings are required to achieve at least LEED Gold or Mostadam 3-Pearl certification by 2030, with FM providers contractually responsible for verified post-occupancy performance.

FM contracts now increasingly include key performance indicators (KPIs) for energy intensity, water consumption, waste diversion and carbon emissions. Circular-economy approaches, including greywater reuse and materials recovery in soft services, are gradually becoming standard practice.

Workforce localization & skills gaps

Labor-market reforms under the Nitaqat program have significantly raised localization quotas for FM-related contracts, reaching up to 70 percent for certain categories by 2025. While this supports national employment and skills objectives, it has also created acute shortages of certified MEP technicians, HVAC specialists and mid-level supervisors.

Leading FM providers are responding through partnerships with the Technical and Vocational Training Corporation (TVTC), the establishment of FM academies and the roll-out of accelerated certification pathways with IFMA, RICS and other international bodies. Nevertheless, the pace of capacity-building risks lagging behind demand from giga-projects.

Regulatory & contractual developments

The regulatory landscape for FM in Saudi Arabia has evolved rapidly. Key milestones include:

  • Mandatory FM licensing introduced by the Saudi Authority for Accredited Valuers in 2024

  • Inclusion of FM KPIs within the National Center for Performance Measurement scorecards for government entities

  • Adoption of 10-25-year performance-based contracts, often featuring gain-share/pain-share mechanisms to align FM providers’ incentives with asset performance and sustainability outcomes

These developments collectively professionalize the sector and increase transparency in FM procurement and delivery.

Emerging risk landscape

The shift toward highly connected, data-rich FM introduces new strategic risks. Table 2 summarizes the main risk categories identified across the reviewed literature.

Table 2. Strategic risk categories for FM (2025–2035)

Risk Category

Description

Severity

Cybersecurity

Vulnerabilities in IoT-enabled and connected building systems

High

Supply Chain

Concentration risk related to specific OEMs for critical spares

Medium–High

Workforce

Localization-driven gaps in technical and supervisory skills

High

Regulatory Fragmentation

Divergent FM-related standards and regulations across GCC states

Medium

Cybersecurity risks are particularly salient given the integration of operational technology (OT) and information technology (IT) environments in smart buildings, prompting the need for robust national and organizational controls.

Discussion

The findings confirm that FM in Saudi Arabia and the GCC is undergoing a structural transformation rather than incremental change. The combination of Vision 2030 targets, giga-project delivery models and rapid digitalization positions FM as a strategic national capability, not merely a cost center.

This study’s contribution lies in highlighting how three forces intersect in the Saudi/GCC context:

  1. Smart technologies (IoT, AI, digital twins)

  2. Localization & workforce reforms

  3. Large-scale, long-term giga-project commitments

While global literature on smart FM tends to focus on technology deployment in mature markets, the Saudi and GCC context is distinctive because the build-out of new cities and districts is occurring in parallel with aggressive nationalization and sustainability goals. This creates both opportunities — for leapfrogging legacy systems — and risks, particularly around skills shortages and cybersecurity.

To fully realize the promise of smart FM, policymakers and industry leaders must adopt an ecosystem perspective: aligning education, regulation, procurement and technology standards. Failure to do so could lead to fragmented implementations, underperformance of high-profile assets, and erosion of investor and public confidence.

Conclusion & recommendations

By 2035, the hard-soft-smart service trichotomy in FM is likely to dissolve into a single integrated and intelligent ecosystem. Smart FM will underpin asset resilience, sustainability performance and user experience across Saudi Arabia and the GCC.

Based on the evidence synthesized, four priority actions are recommended:

1. Mandate digital twin handover at practical completion

Require that all major new assets be delivered with fully operational digital twins and clearly defined data standards to support life cycle FM.

2. Embed ESG-linked KPIs in long-term performance contracts

Align FM contracts with energy, water, waste and carbon targets, incorporating gain-share/pain-share mechanisms that reward verified improvements.

3. Establish structured apprenticeship & certification pipelines

Expand TVTC-industry partnerships and adopt globally recognized FM certifications to close technical skills gaps while meeting localization targets.

4. Pursue GCC-wide regulatory harmonization for FM

Develop regional guidelines or frameworks to reduce regulatory fragmentation, facilitate cross-border FM operations and support economies of scale.

Smart FM is poised to become a cornerstone of sustainable urbanization and economic diversification across the region. Proactive coordination between policymakers, developers and FM providers will determine the extent to which this potential is realized.