The smart building market is expected to register a CAGR of over 23% over the forecast period (2020
Feb 20, 2020, 14:05 ET
NEW YORK, Feb. 20, 2020 /PRNewswire/ --
Market Overview
The smart building market is expected to register a CAGR of over 23% over the forecast period (2020 - 2025). Growing energy concerns, increasing government initiatives on smart infrastructure projects are driving the market's growth positively.
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- Energy costs are rapidly increasing, and environmental issues are a major concern today. There is increasing pressure to provide more energy-saving solution to save money. As energy conservation has become more important recently, demand for smart buildings has increased.
- Smart buildings solutions not only transform the buildings into energy-efficient and sustainable buildings but also automates the way buildings can be managed and controlled.
- Another reason for driving the market's growth is supportive industry standards and regulations. As governments across the globe take steps towards bolstering sustainability and energy efficiency regulations, more opportunities are available to the smart building market.
- For instance, the Canadian government is laying high emphasis on energy conservation through smart buildings, majorly, including offices and homes. Moreover, the United Kingdom also has kept considerable efforts in smart building solutions, primarily to reduce the carbon footprint from the building sector and reduce its energy consumption
- Besides the growth in individual smart buildings, the need for smart cities has also increased. Governments are realizing the benefits of incorporating IoT into their cities. As more smart infrastructure is added to cities, the smart building market is expected to grow. According to the Consumer Technology Associations, spending on smart cities is expected to grow to USD 34.35 billion by 2025 from USD 14.85 billion in 2015.
- Eco-friendly and green buildings have become increasingly common, and these buildings contain a variety of smart features. According to a recent survey of construction stakeholders in the United Kingdom, conducted by the International Trade Administration, United States, it is estimated that the country has witnessed a 14% gain in the number of companies willing to build 60% of their projects as green projects by the end of 2018.
- Moreover, increasing security concerns and the latest technological enhancement and reliability that is offered by the intelligent security systems is increasing its demand in the market.
Scope of the Report
A smart building is a building that automates its processes to control its infrastructure, lighting, security systems, heating, ventilation, air conditioning systems, and more. A smart building uses technology to make buildings more efficient, sustainable, safer, and reduce costs. The smart building solutions are part of the growing IoT and connected sensor ecosystem.
Key Market Trends
Growing Adoption in Commercial Application Boosting the Market's Growth
- The commercial segment comprises of office spaces, hotels, malls, hospitals, shopping complexes, and restaurants, among others. Today, commercial buildings are getting smarter. They include a growing variety of technologies that are part of the IoT phenomena. Across the globe, new buildings are being constructed with both wireless and wired IoT infrastructure that enables innovation.
- According to the United States Energy Information Administration, commercial buildings account for nearly 20% of United Stets energy consumption and 12% of greenhouse gas emissions in the country. By reducing waste and conserving energy, smart buildings create benefits for the global community at large.
- Additionally, According to the U.S. Department of Energy (DOE), HVAC, and lighting alone consume about 50% of energy use in the average commercial building. By incorporating smart building automation systems, lighting, and HVAC solutions can decrease energy costs between 30% and 50%. These solutions use predictive analytics and real-time data processing to make proactive decisions to enhance airflow, thermal comfort, and lighting while reducing the energy bill.
- Many commercial buildings have adopted smart building technologies. For instance, The Mirage in Las Vegas uses smart building technology to lower their energy costs through load-shedding. The Edge, a commercial office building in the Netherlands, boasts a smart LED lighting system, which has over 30,000 sensors connected to the building management system through the IoT. The Edge uses about 70% less electricity than an average commercial office building.
- Furthermore, According to a Dell and Intel study, 44% of office workers worldwide do not think their offices are smart enough. Smart workplace technology, which can include networked platforms, software, sensors, and IoT technology, can be used to enhance workplace security, comfort, productivity, energy efficiency, and much more.
Asia-Pacific is expected to Witness Highest Growth Rate
- Asia-Pacific is expected to witness the highest growth rate over the forecast period owing to supportive government initiatives, growing commercialization, and industrial development activities in countries such as India, China, South Korea, Singapore, and Australia.
- Smart buildings and digital construction are being witnessed as an economic engine for China. The Chinese government has set an environmental goal of 30% green buildings for new construction by 2020.
- In 2017, The government of India developed 'The Energy Conservation Building Code' (ECBC), which sets minimum energy performance standards for buildings and includes the building envelope, heating, ventilation, and air conditioning. Hence, the growing adoption of smart building solutions could help the country in saving energy.
- Additionally, the growing number of government initiatives for smart city projects is expected to boost the market's growth over the forecast period. For instance, According to a report released by the Minister of Urban and Housing Affairs, 148 projects have been completed until January 2018, under India's Smart Cities Mission.
- Moreover, According to Juniper research, eight Asian cities were listed among the top 20 spots in the recently released global smart city index 2017. Singapore, Seoul, Tokyo, Melbourne, Wuxi, Yinchuan, Bhubaneswar, and Hangzhou were listed among the best overall performers across four key areas of healthcare, mobility, safety, and productivity. The result has been a massive surge in spending on smart city technology.
- A survey by Honeywell India of 2,000 buildings across 10 Indian metros which evaluated building 'smartness' across the parameters of being green, safe and productive found that although the country's hotels and airports led the way with smart building technologies, the overall smartness of buildings in India is low.
- The study found that most buildings scored highest on green elements (45) while safety was lowest (21). India could save billions each year by adopting modern technologies in buildings that drive green, safe, and productive outcomes. This is anticipated to provide growth opportunities for smart building solutions and services.
- Government's strong commitment to tech-friendly legislation and a massive investment in its smart city infrastructure is driving smart building development in Singapore. The Capital Tower in Singapore is one of the first smart buildings in the city.
Competitive Landscape
The smart building market is fragmented currently with the presence of established global and domestic players across the globe. The market will be mainly driven by the addition of modern technologies and customizations to attract end-users. Vendors are concentrating primarily on offering innovative products and solutions that can optimize energy consumption and serve a high degree of automation in buildings.
- August 2019 - Honeywell International, Inc. a global vendor in smart building technology and services, introduced the next generation of Enterprise Building Integration (EBI), Command and Control Suite (CCS), and Digital Video Manager (DVM), a suite of solutions enabled by the Honeywell Forge for Buildings platform. This solutions drive facility efficiency, streamline complex functions, and deliver savings across an enterprise.
- July 2018 - Schneider Electric SE announced the next generation of EcoStruxure Building, the open innovation platform for buildings. EcoStruxure Building's open, end-to-end IP architecture enables quick connectivity of IoT devices for faster commissioning and changes and delivers for edge control and collaboration between building systems and third-party systems and devices.
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