Bringing Facilities Management In-House

facility maintenance


The build to rent sector in the UK has grown greatly in popularity since its introduction. There are over 152,000 BTR properties in the UK to date (including those in the planning pipeline), and it’s predicted that the market will be worth approximately £544 billion once it reaches full maturity.

These numbers are truly exciting for anyone who works in the BTR sector, as the potential for growth is staggering. However, these figures also bring to attention the current infancy of the BTR market in the UK. The sector is still growing here, and there are many ways BTR operators can improve the running of their developments to bring them up to speed with stronger global BTR markets, such as the one in the US where the total market is worth in excess of $2.9 trillion (as of 2018).

Traditional PRS outsourcing methods have issues and aren’t the most cost-effective way to run things. Introducing in-house facilities management provides a more stable long-term solution that can vastly improve the UK BTR sector as it continues to grow. By implementing Centralised Purchasing and a strong inhouse FM team, managers can reduce their costs and make their scheme a more profitable venture.

What’s the Norm in Traditional PRS Facilities Management?

Facility management

In UK managed PRS developments, outsourced maintenance teams can be built around multiple companies. These companies then have to coordinate their efforts to keep the building running in a way that works for them — even if it means outsourcing themselves to get tasks done.

These outsourced teams are charged with the responsibility of the building’s upkeep, but are likely to be on a ticket basis, meaning they’ll only be around when they’re required to be. Ultimately, this leaves PRS residence managers with the responsibility of keeping every aspect of the building safe whilst also finding a way to keep costs in budget.

This can result in the wrong solutions being implemented. Instead of taking a look at the bigger picture of why a problem has occurred, there’s the temptation to go with the most cost-effective or quickest fix.

Other facilities management companies have an open book policy, managing a building but not having any ownership. Because they don’t own the asset, their pricing strategy becomes a matter of making a marginal profit. The more you spend, the more profit the management company makes, which can quickly lead to expenditure getting out of control.

Another issue can stem from the fact that PRS facilities management companies might not be used to dealing with individual units. The people who live in traditional PRS units arrange their own solutions, which means the residence managers have no say in the service level agreements.

The private rental sector has been subjected to these operational methods for years. BTR and in-house facilities management can offer a better solution.

The Benefits of BTR In-House Facilities Management

In-house facility management and BTR in general brings with it a more pragmatic approach. Your in-house team isn’t looking to make a mark-up on products and services when an issue arises; they take ownership of the asset and look towards finding the best overall answer to the problem.

It’s a more strategic solution, and one that can be fit around work that’s already in motion, keeping things running as efficiently as possible.

While outsourcing focuses on the here and now aspect of problem solving, in-house facilities management takes a look at the bigger picture. If, for example, a CCTV camera is in need of constant repair, an outsourced company may decide to remove and replace the unit at a hefty cost. Your in-house team can take a more measured approach, and may discover the reason why the camera breaks is due to a faulty wire or a poor wifi connection to the server. It would be much cheaper and simpler in the long-run to replace the wire or boost the internet signal.

That’s not to say an in-house facilities management team will completely avoid capital expenditure. Their aim is to reduce operational costs, and a new technology or devices could use less energy, have longer warranties, or are easier to maintain. If it makes financial sense and meets the end goal, cap ex could be the best answer.

Choosing to go in-house also helps from a marketable point of view. You can find members that have similar values to your company, and they will soon become known and recognisable amongst residents. This will help strengthen your brand. Residents will know who to turn to if an issue crops up in the individual units as well as the communal area.

From our own data on maintenance, we know many of the issues residents have are based around their individual living spaces. Being able to solve the problem quickly not only reduces the amount of steps it takes to fix, it vastly improves customer service. This can lead to the resident being more likely to re-sign at the end of their tenancy agreement.

How Fjeld Can Help

As BTR grows in popularity, the UK market will shift towards the same operational style that’s been adopted in the US. It will become better managed and more cost-effective to operate. We already have an extensive background in the US BTR sector, and we would advise our clients to switch towards in-house facilities management sooner rather than later.

Identifying the best opportunities for operational savings can only come with knowledge and experience. We offer Centralised Purchasing consulting services to help speed up the process While operators can reduce costs by procuring in bulk (say, by purchasing thousands of washing machines for every asset owned by the company), we can take that even further by approaching suppliers to accommodate orders for several different BTR companies. This can save everyone huge sums, whether that’s by getting a significant reduction on price or getting free delivery.

Additionally, we’ll work with you to find ways in which you can earn ancillary income while saving money across other departments.

We’ve already helped numerous BTR operators in the UK, Europe and America. A good example is when we were approached by a client to reduce the expense ratio of a 950-bed purpose-built student accommodation property from 35% to the industry goal of 25%. Our facility management programme met this goal and went on to save them £400,000 per annum.

Intrigued by In-House Facility Management?

In-house facility management can save BTR operators a great deal of time and money. It’s about finding the right solution at the right price, and the skills and experience we have gained in the US make us perfectly placed to advise you. We can consult at a higher level based on the processes we’ve already successfully implemented instead of basing suggestions on data interpretations.

Our aim is to bring the UK BTR market up to the high standard we all know it can reach. There’s plenty of growth available in this sector, and an expert hand can help operators achieve this potential much sooner than forecasted. For more information on how we can help, make sure to get in touch.



About the Author: Dustin Fjeld

Dustin Fjeld
As founder member of Fjeld Consulting, Dustin has helped save clients thousands across a range of BTR, PBSA, PRS and Co-living portfolios.

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