Green buildings utilize energy and water efficiently and aim to reduce the negative impact on the environment by incorporating design elements that are eco-friendly. The building envelope is optimized for energy efficiency through such measures as improved insulation, high-performance windows, increased air tightness of the building envelope and efficient heating, ventilating, and air conditioning systems. Green or sustainable buildings are designed to reduce both operational as well as embodied energy and provide healthy indoor environmental quality through choice of materials, ventilation and day lighting.
The green buildings market is estimated to be valued at USD 565.33 Bn in 2024 and is expected to reach USD 1,060.50 Bn by 2031, growing at a compound annual growth rate (CAGR) of 9.4% from 2024 to 2031.
Key players operating in the green buildings market are AECOM, Bauder Limited, Alumasc Group Plc, Siemens AG, and Interface.
Key opportunities in the Green Buildings Market include growing awareness and investments towards energy efficient infrastructure, increasing adoption of renewable energy sources and green materials for construction. With rising environmental consciousness globally, the demand for green buildings is increasing across regions providing vast opportunities for market expansion.
Major companies in green buildings are exploring opportunities in developing countries of Asia Pacific and Latin America to leverage opportunities arising from rapid urbanization and infrastructure development in these regions. Governments in countries like India, China, Brazil etc. are providing incentives and formulating favorable policies to promote green construction.
Market Drivers
Stringent government regulations regarding energy efficiency in buildings have led to growth in demand for green building materials and technologies. Compliance with energy efficiency norms is crucial for obtaining construction permits and occupancy certificates in many countries. Green Building certifications like LEED also mandate use of green building methods and materials. Thus, the regulatory push is a major driver for market growth.
PEST Analysis
Political: Laws and regulations related to green building norms, incentives for green building construction, real estate development policies.
Economic: Incentives available from government for green projects, additional initial cost of green technologies, operating cost benefits of green buildings.
Social: Increasing awareness about environment and climate change, preference for sustainable lifestyles, health and wellbeing factors of occupants.
Technological: Advancements in renewable energy solutions, energy-efficient equipment and appliances, smart building automation systems, green building certification programs.
Geographical Regions of Concentration
Currently, the market in terms of value is highly concentrated in few regions globally. North America and Europe collectively account for more than 60% share of the total green buildings market. The United States is the largest country market followed by various countries in Western Europe like Germany, United Kingdom etc. This is owing to stringent norms regarding energy-efficiency, early adoption of green building practices as well as higher investments in these regions.
Fastest Growing Region
The Asia Pacific region is poised to witness the fastest growth in the green buildings market over the coming years. Factors such as rapid urbanisation, rising construction activities, increasing GDP along with government initiatives and incentives are driving the growth. Countries like China, India are putting strong impetus on sustainable infrastructure development which is expected to boost the green buildings market in Asia Pacific region immensely.
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Ravina Pandya, Content Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials, etc. (https://www.linkedin.com/in/ravina-pandya-1a3984191)
