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Real estate maintenance requires smart solutions in an increasingly competitive environment

With growing market activity, success is achieved by those real estate maintenance companies that provide complex services and have the shortest outsourcing chain. The age of a worker in this sector is just a number – the desire of a person is way more important.

What is the current situation in real estate maintenance compared to the rest of the market?

Mikk Sillamaa (MS): Today is a very busy period in the field of property maintenance, and partnership relations with property owners are closer than ever before. The property owner wants to have a partner who takes care of his problems and takes the initiative. Due to high energy prices, various energy efficiency projects play an important role in helping to save energy. In addition, today more attention is paid to other current costs. Market participants that have not previously invested in personnel and technology to ensure the transparency of services and efficiency of managing them, today are unable to meet the expectations of property owners. This means that some companies cannot keep up with increased market expectations. We can observe the growing activity of the market in terms of the number of requests received.

What are the biggest challenges in the real estate maintenance sector in the winter and spring of 2023?  

Mikk Sillamaa: The biggest challenge facing property maintenance companies is to incorporate increased entry prices into the cost of their services. This may not be easy given the general economic environment where property owners are facing rising Euribor rates and energy prices. Prices in the real estate management sector are most affected by rising wage pressure. Unfortunately, our sector has stagnated for years, many professionals have left, and because our field generally is not well promoted, there are not enough new professionals, which in turn deepens the wage pressure. As rising wage pressure cannot be factored into service prices, smarter and more efficient management is required. Here, various software solutions come to the rescue, helping to control and plan work processes. At our company, we have put all workflow management on the Saago platform, which analytics allows finding smarter decisions.

Where is the property maintenance heading in the long term?

Mikk Sillamaa: The development of the real estate service sector is greatly influenced by the client. It is nice to see customers becoming more professional and knowledgeable over time. This, in turn, forces service providers to work harder and develop their services. At the moment, the real estate service market is moving steadily towards providing a full service – where real estate owners delegate all their real estate-related responsibilities to a single partner. This saves clients time and allows them to focus on their core business. In addition, I see the success of companies that provide complex services themselves and whose outsourcing chain is as short as possible. This provides customers with flexibility and synergy between the services provided.

How has the service changed in the face of competition in the situation on the real estate market?

Mikk Sillamaa: There are enough good companies on the market, and this forces the participants to work hard and develop their services. Companies with many public sector contracts are having a tough time due to strong growth in input costs. These contracts have price adjustment limits that do not support the provision of sustainable services and may lead to early termination of the contract by the customer. I hope and believe that this will change the current pricing policy of market participants and the time of overly low prices will come to an end. In the private sector, the price of services also plays an important role, of course, but this is not the only criterion for choosing a partner. Success comes from businesses that have previously built their capabilities with people and invested in software solutions to manage their services smarter. It is clear that some companies do not participate in private sector procurements simply because they cannot meet the expectations of clients.

Does real estate require migrant labour? If so, what kind of foreign labour force do you expect?

Mikk Sillamaa: Estonia has reached a point in its development when foreign labour is a part of the economy as a whole and no sector can do without it. The Stell Training and Competence Centre has created conditions and a program that allow foreign workers to better integrate into our labour market.

Does the age of an employee matter?

Mikk Sillamaa: At Stell, we treat all employees equally: age, gender and skin colour do not matter for us. In 2018, we became one of the first companies to receive the Austame erinevusi diversity label. For us, the age of employees is just a number. Thanks to the specifics of the industry, we can find affordable work for almost every person of working age.

For the full article learn more: https://www.kinnisvarauudised.ee/uudised/2023/03/03/kinnisvarahoolduses-jaab-toojoust-puudu

Photo: Marko Mumm