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INCREASING ROI THROUGH FM

Increasing ROI Through FM

June 2016

Dubai-based facility management consultant, chartered engineer and environmentalist Alan Millin, discusses the role of FM in improving the efficiency of buildings, communities and cities.

We design and build fantastic buildings with high-tech systems. We develop communities and cities and strive to make them smart. But there is something missing… We should be designing for the people who make up our communities rather than the personal gratification of architects, engineers and town planners.

Facilities have to support efficient operations for generations to come and we should be working to address this issue very early on in any project. The literature tells us that up to 92% of life-cycle operating costs of facilities are people related; there is clearly an opportunity for designers to make a significant impact here and real estate investors are in a position to demand that impact is made.

At the smart city level, it is easy to find references to successful “smart” initiatives in various cities around the world, all intended, of course, to improve the lives of city dwellers and visitors. We may consider it odd then that the literature, as recently as 2014, also reveals that there is no evidence to support claims that smart cities improve quality of life for citizens and that technology alone is not enough to create public value. Again, something is missing; the consideration of people?

THE TRUE ROLE OF FM

Facility management (FM) is an incredibly wide-ranging discipline that can help improve the efficiency of buildings, communities and cities by considering how people will use what has been, or is to be built. Unfortunately, FM is often not well understood by other disciplines. FM consultants are often seen as interfering busy-bodies by development project teams, and are challenged to clarify why they are needed. This is good though, as it gives the FM consultant an opportunity to explain the benefits of FM to all. Sadly though, the pro-FM arguments are too often dismissed, which is a pity when we consider that FM is often defined as the integration of people, place, process and technology. Notice how people come first in the list of integrated items.

If we are to move ever more toward sustainability it is important that FM be recognised as a contributory factor rather than a handicap. One path toward achieving this recognition is to integrate FM into green building rating systems and regulations. By doing so we could reap benefit at the facility, sub-community and master development levels. People and their needs would be considered from the outset.

SUPPORTING SUSTAINABILITY GOALS

FM-related credits could be built into green building systems that directly support sustainability. These could include rating system credits for FM design reviews, asset management planning, life-cycle costing, space planning etc. Each of these credits can easily be documented in terms of intent and requirements, allowing them to be integrated into existing green building rating systems such as the United States Green Building Council (USGBC)’s LEED rating systems.

One of the problems with most, if not all existing green building ratings systems, LEED included, is that the operational phase of buildings is largely overlooked or is considered as an add-on or after-thought. The inclusion of FM-related credits would go some way to mitigate this shortcoming. The intent of an FM design review credit may, for example, be to support achievement of the owner or master developer’s operational project requirements, shifting focus from what may end up as just a green building toward the development of a sustainable building. To earn the credit, project teams would have to show how the FM consultant’s comments have been addressed in the final design iteration.

To reap the potential benefits that FM offers we first need to establish the strategic benefits of FM within the green building communities. Even this apparently straightforward requirement might be difficult to achieve without a change of mindset by rating system designers. LEED, for instance, is now in its fourth incarnation yet, surprisingly, it gives little acknowledgement to FM. Indeed, an electronic search of the latest LEED Building Design and Construction reference guide for the term “facilities management” returns only seven hits. Of these, four are simply definitions while the other three appear with reference to water metering. Water meters will allow facility managers to monitor changes in water consumption and gather data, we are advised. Clearly then, LEED considers FM to be an operational, downstream function rather than a strategic, upstream, value-adding discipline.

INVESTORS NEED TO TAKE INITIATIVE

This offhand attitude toward FM by the USGBC may be considered strange when one considers that the US-based International Facility Management Association predates the USGBC’s LEED rating system by almost two decades. Why has the USGBC not embraced strategic FM when it can contribute so much to green buildings and sustainability? Much more lobbying and collaboration is needed if developers and owners are to receive enhanced returns from their real estate projects.

Investors can wait for FM industry bodies and green building councils to get together or they can accept that, as that hasn’t happened in the last couple of generations, it is unlikely to happen in the foreseeable future. They then need to drive the initiative themselves.

By demanding the inclusion of FM as a pre-condition to signing on to a project, investors will have created the environment for enhanced returns. This might sound like the banging together of a couple of very old, stubborn heads but, as the individual FM and green building industries have so far failed to come together effectively to deliver maximum value, it is high time that those who hold the purse strings start to call the shots.

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