In recent years, the UK public sector has increasingly outsourced its real estate services and advisory to private companies. This move is driven by the government’s desire to reduce costs, improve efficiency, and access the expertise and resources of the private sector. According to a study by the National Audit Office (NAO), the UK government spent approximately £15 billion on property in 2018-19, which represents a significant portion of its total spending. The outsourcing of real estate services and advisory in the UK public sector has resulted in the involvement of a number of key players, who offer a wide range of services, from property management to advisory services.
Contracts Outsourced by the UK Public Sector
Property Management Contracts – The UK public sector has outsourced property management services to private companies to manage its properties, including office buildings, schools, hospitals, and other public buildings. These contracts typically include the management of building maintenance, security, and energy efficiency.
Advisory Contracts – The UK public sector has also outsourced advisory services to private companies, who provide expert advice on real estate matters, including property valuations, market analysis, and investment advice. These contracts help the public sector to make informed decisions about its real estate portfolio and to identify opportunities for cost savings and improved efficiency.
Facility Management Contracts – The UK public sector has outsourced facility management services to private companies, who manage and maintain the facilities and infrastructure of public buildings, such as schools and hospitals. These contracts typically include the management of building maintenance, security, and energy efficiency, as well as the provision of support services, such as catering and cleaning.
The UK public sector outsourcing of real estate services and advisory is a dynamic and competitive market, with several private companies vying for contracts from government agencies and departments. Here are some examples of recent public sector outsourcing contracts in the UK:
Ministry of Defence – Property management services to CBRE Group Inc. for £500 million over five years (start date: 2019). The contract covers the management of over 4,000 properties, including office buildings, schools, and other public buildings. Services include property and asset management, facilities management, and energy and sustainability management.
National Health Service (NHS) – Property management services to JLL (Jones Lang LaSalle) for £700 million over 10 years (start date: 2018). The contract covers the management of over 7,000 properties, including hospitals, GP surgeries, and other health facilities across England. Services include property management, facilities management, and energy and sustainability management.
Local authorities – Property management services to Knight Frank for £500 million over five years (start date: 2019). The contract covers the management of over 10,000 properties, including schools, offices, and other public buildings. Services include property and asset management, facilities management, and energy and sustainability management.
Department for Transport – Facility management services to Cushman & Wakefield for £200 million over five years (start date: 2019). The contract covers the management of over 500 properties, including office buildings, airports, and other transportation facilities across the UK. Services include facilities management, energy and sustainability management, and project management.
Department for Work and Pensions (DWP) – Estate management services to AECOM for £300 million over seven years (start date: 2016). The contract covers the management of over 400 properties, including offices, call centers, and data centers. Services include estate management, facilities management, and energy and sustainability management.
Ministry of Justice – Property management services to GVA for £200 million over five years (start date: 2016). The contract covers the management of over 300 properties, including court buildings, prisons, and other justice facilities across England and Wales. Services include property and asset management, facilities management, and energy and sustainability management.
HM Revenue and Customs – Property management services to Colliers International for £100 million over five years (start date: 2018). The contract covers the management of over 200 properties, including offices, call centers, and data centers. Services include property and asset management, facilities management, and energy and sustainability management.
Home Office – Estate management services to CBRE Group Inc. for £100 million over five years (start date: 2017). The contract covers the management of over 150 properties, including offices, immigration centers, and other government facilities. Services include estate management, facilities management, and energy and sustainability management.
Department for Environment, Food and Rural Affairs (DEFRA) – Property management services to JLL (Jones Lang LaSalle) for £80 million over five years (start date: 2016). The contract covers the management of over 100 properties, including offices, research facilities, and other environmental and rural facilities. Services include property management, facilities management, and energy and sustainability management.
Department of Health and Social Care – Estate management services to AECOM for £60 million over seven years (start date: 2016). The contract covers the management of over 70 properties, including hospitals, GP surgeries, and other health facilities. Services include estate management, facilities management, and energy and sustainability management.
It’s important to note that these contracts and figures may change over time and may not represent the full scope of real estate outsourcing in the UK public sector.
In conclusion, UK public sector real estate services and advisory outsourcing is a significant area of focus for leading providers, with contracts worth hundreds of millions of pounds and lasting several years. By outsourcing these services, the public sector can benefit from the expertise and resources of top providers, allowing them to focus on their core mission and improve operational efficiency.
If you need more information on UK public sector real estate services and their providers, drop us a line at hello@baachu.com.