Drivers include emphasis on energy efficiency, government initiatives, rising adoption of IoT
The global smart building market is forecast to grow from $5.73 billion in 2016 to $24.73 billion by 2021, increasing at a compound annual growth rate (CAGR) of 34 percent from 2016 to 2021, according to a report published by MarketsandMarkets.
The major drivers for upsurge in demand for smart building technology solutions include emphasis on energy efficient buildings and reducing CO2 emission, growing initiatives by government authorities for the development of smart building projects, rising need for integrated security and safety systems, and rising adoption of IoT platforms within the building automation technology.
Evolving cloud-based IoT platforms and environmental concerns and green building initiatives offer major opportunities for smart building solution providers
Buildings consume a lot of energy. According to the International Energy Agency, almost around 40% of the world’s energy is consumed by buildings. The growing consumption can be attributed to the increasing number of electrical appliances; increasing use of energy is raising the amount of energy wastage and CO2 emission, which leads to an urgent need for sustainable and efficient usage of energy. The market size of building energy management systems is the highest and is expected to grow at a significant rate across the globe. Moreover, growing demographics and hyper-urbanization is also pushing the market to adopt building energy management systems.
System integration and deployment services segment is expected to grow at the highest CAGR during the forecast period
The market for services would witness a major increase because of the rise in the adoption of smart building automation software, which is propelled by the increasing demand for system integration, consulting, support and maintenance, and managed service that support the implementation of smart solutions across the various building types.
Europe is expected to hold the largest market share in the smart building market
As per the geographic analysis, Europe is likely to benefit from its technological advancements and a large number of smart city initiatives being undertaken in the region, which are already underway. The adoption of smart building solutions across Europe is estimated to rise at a significant rate due to the regulatory push, amended policy framework, operational efficiencies, cost containment, and sustainability benefits and the changing business dynamics. This which would eventually increase the penetration of system integration and deployment services in this region.