FM newsroom – fm sentiment index. According to LEO, the Hungarian National Association of Facilities Management and Building Operations Service, the facilities management sentiment index showed cautious optimism with slight uncertainty in the fourth quarter of 2024.
The Facilities Management Sentiment Index prepared by the National Association of Facilities Management and Building Management Service Providers (LEO) settled at 51.00 points for the fourth quarter of 2024. This value indicates a slight increase compared to the previous quarter; however, as FMBusiness reports, the industry remains cautious about the future.
No major changes are expected
The 51.00 point, with its value above the neutral 50 points, suggests optimism, but according to the expectations of the professional community, no major changes are forecasted in the coming period. The end-of-year seasonal effects (accidental orders, spending of remaining budgets) maintain the positive mood, but macroeconomic challenges are still felt.
“We expect stagnation by the end of the year; a drastic change is unlikely. The 2024 US presidential election will further complicate the current economic situation. The possible effects of the election may become significant from 2025,” – Fmbusiness quotes the survey.
Economic slowdown and cost reduction: challenges remain
A significant number of respondents are concerned about the slowdown in industrial production, which will also impact the facilities management sector in the short term. The decline in production is expected to lead to cost-cutting measures, where the first victim is often the cost of operating real estate.
Key challenges
- Labour shortage – 60% of respondents named the lack of skilled labour as one of the main obstacles to growth.
- Inflation and wage pressure – Rising wage demands due to high inflation continue to put pressure on the FM industry’s margin generation capacity.
- ESG regulations – New, stricter environmental and certification requirements increase administrative burdens but may also offer new business opportunities.
Most companies focus on the last months of the year when the number of one-off orders traditionally spikes. However, respondents warn: “Quality is not the primary concern, but price”, which could be risky in terms of competitiveness in the long term.
Key expectations for the fourth quarter
- Revenue growth: expected to increase by 1.73%.
- EBITDA growth: expected to increase by 2.27% according to management’s forecast.
- Headcount: the workforce could increase by 1.73%.
- Outstandings decrease: slight decline of 1.07%.
2024 is a special year, as the LEO Sentiment Index is now in its 10th year. The index results show that the sector is able to face challenges, even as uncertainty increases.
Summary: stability, but not complacency, characterizes facilities operators
The LVHI value of 51.00 points reflects stability, but the sector is aware of the challenges ahead. The US presidential election, labour shortages, ESG requirements and the economic slowdown are all factors that will determine the outlook for the coming period.
The experts said, “Strong seasonality keeps the index in positive territory, but the impact of increasing uncertainty and cost reductions cannot be ignored.”
