The global smart building market is set to grow at an annual rate of 12.3% in the decade to 2032, increasing in value from $78.3bn to top $247.2bn, according to new research
Analysis by Allied Market Research said the growth will be driven by a number of factors, including government-backed smart infrastructure initiatives, the emergence of AI technologies and the growing application of IoT.
However, it added, security concerns associated with smart buildings and higher investment requirements are limiting the growth of this market.
Smart buildings are characterized by the use of completely integrated systems that communicate critical information and utilize this information to improve the efficiency of the buildings.
Smart buildings can help manage almost every aspect of building management using IoT sensors, higher floors and building automation, including HVAC, lighting, shading, security and even user-centric tasks like navigation and conference room scheduling.
Smart building solutions
Smart building solutions, which use IoT technology to enable efficient use of resources, are estimated to have gained the largest market share in 2022 and will likely grow at the fastest rate over the forecast period.
Solutions use a range of technology, such as sensors and actuators, to gather activity data on various aspects within the building, which helps analyze and utilize operation more efficiently.
Security and emergency management
The security & emergency management (SEM) segment dominated the smart building market share in 2022.
It is expected to have among the top market shares during the forecast period owing to the growth in digital disruption in people’s everyday lifestyles contributing to the growth in demand for smart infrastructure solutions, which in-turn strengthens the demand for real-time security and emergency management.
On the other hand, the workforce management segment is expected to witness the highest growth in the upcoming years, as the demand for green and sustainable building management solutions is aiding in the growth of the market.
Commercial dominates market, but residential on the rise
The commercial segment dominated the smart building market share in 2021 and is expected to continue this trend during the forecast period, owing to the rising need for efficient energy and resources management solutions in commercial buildings.
However, the residential segment is expected to witness the highest growth in the upcoming years, as rising standard of living and urbanization trends are fueling the demand for smart buildings.
Moreover, the smart infrastructure initiatives are being supported by government and local authorities, which is further empowering the growth of the segment and the market forecast in the coming few years.
Regional analysis
North America dominated the smart buildings market n 2021 and is expected to retain its position during the forecast period, owing to the presence of a highly developed ICT sector and high spending, aiding the growth of the smart building industry.
However, Asia-Pacific is expected to witness significant growth during the forecast period, owing to various government initiatives and digital transformation trends within the region, which is expected to fuel the smart building market trends in this region.
