Facility management

What it means

Facility management is managing and providing support services for buildings and their users, such as maintenance, energy, cleaning, security, reception, parking and catering. The aim is a building that runs reliably so people can work in it without worries.

There is technical facility management, which looks after the building and its equipment, and infrastructural facility management, covering services for people such as cleaning, security or reception. Space planning, moves and lease management also fall under it.

Companies often outsource it so they can focus on their core business. An outside provider brings experience, equipment and staff and, for larger buildings, may be cheaper than an in-house maintenance and services team.

How it works in practice

The contract with the provider should set out the scope of services, quality and response times in an SLA, for example how many hours to fix a heating failure, along with how performance is measured and penalised. Regular reporting on work done and costs also helps.

In the accounts, routine facility management services are booked as repairs and maintenance or services. For larger works, check whether they amount to a technical improvement that is capitalised into the building's value and depreciated.

When renting premises, the lease agreement sets out which services the landlord provides, which the tenant provides and how costs are allocated. Energy savings, for example based on an energy audit, are among the most common goals of modern facility management.

What to watch out for

With outsourcing, think about security and outside workers' access to premises and data. Cleaning or security staff often have access to keys and sensitive areas, so the provider should be vetted and clear rules set.

A cheap offer may hide poor quality or illegal work by subcontractors. The client may be liable for illegal employment at the provider, so it is wise to ask for proof of proper employment and to check subcontractors.