Enjoy complimentary customisation on priority with our Enterprise License!
The smart buildings market size is forecast to increase by USD 64.84 billion at a CAGR of 10.61% between 2023 and 2028. The market's growth trajectory is shaped by various factors. Firstly, there's a mounting demand for building automation systems aimed at optimizing business outcomes. Secondly, there's an increasing emphasis on safety and security, driving the need for advanced systems in these domains. Lastly, the imperative to conserve energy is gaining prominence, propelling the adoption of energy-efficient solutions. These factors collectively underscore the evolving landscape of building management, where automation, safety, and sustainability are pivotal. As businesses prioritize efficiency, safety, and sustainability, the market for building automation systems continues to expand, catering to diverse industry needs and challenges. Our market report examines historical data from 2018-2022, besides analyzing the current and forecasted market scenario.
Furthermore, stringent government regulations on reducing energy consumption and the presence of many global vendors are the major factors driving the market in the region. The increasing use of smart grid solutions in the US as part of the overhaul of the national electricity network is also driving the growth of the smart buildings market in the region. Additionally, ABB Ltd. company offers smart buildings through building solutions such as well being, efficiency, cost transparency, sustainability, connectivity, etc. Also, Advantech Co. Ltd. company offers smart buildings such as Wzzard, WISE 6610, WISE DeviceOn, WP EnSaaS, and Helicon.
Market Forecast 2023-2027
To learn more about this report, Request Free Sample
The market is experiencing rapid growth fueled by the demand for energy-efficient systems and PoE solutions. Smart Buildings solutions and services integrate technologies to optimize energy usage and reduce greenhouse gas emissions. Advancements like 5G technology enable real-time monitoring and control of Commercial buildings, enhancing energy management and security & emergency management. With Building infrastructure management solutions and Business Information Modeling (BIM), the Commercial Real Estate (CRE) sector adopts Artificial Intelligence (AI) and Virtual Reality (VR) for improved operations. Home automation and Waste management solutions further contribute to sustainable and intelligent building practices. Our researchers studied the market research and growth data for years, with 2023 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.
The rapid evolution has been driven significantly by the pressing need for enhanced safety and security systems. With escalating concerns over safety threats, including physical security breaches, natural disasters, and health emergencies, the demand for intelligent building solutions has surged. Smart buildings offer a comprehensive array of advanced security features that far surpass traditional systems. These include the real-time monitoring of access points, surveillance cameras equipped with AI-driven analytics for threat detection, and integrated alarm systems that can alert occupants and emergency responders swiftly.
Furthermore, government regulations and industry standards that mandate the implementation of robust safety and security measures in buildings have further propelled the adoption of such solutions. In addition to compliance requirements, organizations are increasingly recognizing the tangible benefits of investing in smart security systems, including improved operational efficiency, reduced insurance premiums, and enhanced brand reputation. Therefore, the growing need for enhanced safety and security systems will drive market growth during the forecast period.
An individual automated system generates information via smart sensors and actuators and integrates the processed information with building management control systems. BIoT is the new concept of making the building intelligent to take insights from the information and react automatically. The cloud infrastructure connects the sensors and actuators to exchange information among themselves and improve the working conditions. This technology enables the expansion of automated systems by simply connecting more devices to existing infrastructure.
Moreover, BIoT allows the integration of handheld devices such as mobile phones and tablets with building control to handle the process remotely. Further, market players are making continuous efforts to integrate smart buildings with cyber security and connected technology. Analytical tools such as big data that can handle and process data up to zettabytes tend to increase the market for IoT-integrated systems. Thus, the increasing adoption of BIoT will boost the growth of the market during the forecast period.
The implementation of building automation software is much more complex than traditional systems, such as lighting, safety, and security in a building. As the amount and complexity of infrastructure increase, the integration of software that performs different functions poses a challenge. Any gap in this integration exposes the software to various physical as well as cyber threats. Further, in a smart building, building automation software provides an interface for all the hardware, and any attempts to hack into one system in the network can compromise other systems, which could lead to the entire network crashing.
Besides, a networked system also involves risks associated with unauthorized access to sensitive data, which can compromise the integrity and privacy of the entire building network. The exploitation of any loophole in the network can have a serious impact on the data center of the interlinked system. As the data center processes and stores a high volume of complex information, the potential risk of cyber-attacks can result in a meltdown of the entire building network, leading to a lag in building operations. Thus, the growing adoption of building automation software increases the risk of security breaches, which may hinder market growth during the forecast period.
The market is driven by energy-efficient systems and PoE solutions, offering solutions aim at reducing greenhouse gas emissions by optimizing energy usage through innovations like 5G technology. In Commercial buildings, Energy management and Security & emergency management are prioritized. Integration of Artificial Intelligence (AI), Virtual Reality (VR), and Internet of Things (IoT) enables advanced functionalities like home automation and Waste management solutions. PoE solutions, intelligent glass, smart thermostats, and smart elevators are all examples of Internet of Things (IoT) technologies that are transforming various aspects of infrastructure and building management.
The BMS segment will account for a major share of the market's growth during the forecast period.? BMS are also known as BAS, and they are installed to integrate all the standalone control and monitoring systems at one point for seamless control of all systems. BMS consists of software, servers, sensors, and other major components such as HVAC, lighting, and emergency control systems, and monitor all devices together. Increasing industrial development, commercialization, and awareness of effective utilization of energy and building optimization will drive the adoption of BMS in these regions.
Customized Report as per your requirements!
The BMS segment was valued at USD 26.73 billion in 2018. Further, as the need to connect different control systems will become eminent, BMS is anticipated to experience high adoption in the commercial sector, high-end residential buildings, and the services sector during the forecast period. Rapid strides in technology innovation will further propel the adoption of BMS as the systems can deploy IoT, analytics, and cloud computing for effective monitoring, controlling, and operating building facilities during the forecast period. Thus, the above-mentioned factors will boost the growth of the segment of the market during the forecast period.
Software plays an important role in smart buildings through integrated building management systems. In such management systems, the software helps in collecting all the information generated by different subsystems, processors, storage devices, cameras, and sensors. The information collected is then processed and used to analyze and arrive at the best course of action, which is then circulated to the appropriate sub-system or device for further corrective or preventive action. Increasing commercialization in growing economies has led to growth in new buildings, and rising energy consumption has created an urge to save energy. Governments worldwide are largely focusing on converting new construction to balance the trade-off. Therefore, the software market is predicted to show high growth during the forecast period.
For more insights on the market share of various regions Download Sample PDF now!
APAC is estimated to contribute 31% to the growth by 2028. Technavio's analysts have provided extensive insight into market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. The US and Canada are the major markets in the region. Rapid industrial and commercial growth in Brazil, Colombia, Mexico, and other countries are anticipated to deploy more smart solutions during the forecast period. In addition, governments in the region are making efforts to reduce emissions and increase energy efficiency in federal buildings.
Additionally, in North America, a considerable number of vendors offer smart building solutions, including Honeywell International Inc., Cisco Systems Inc., Johnson Controls International Plc, and Raytheon Co. With several vendors based in the US, the competition within the market is growing, which is further driving innovation. The US accounts for the largest market share, comprising most of the smart buildings market in the region. Thus, the above-mentioned factors will boost the growth of the regional market during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including:
Cisco Systems Inc., Delta Electronics Inc., Emerson Electric Co., Honeywell International Inc., International Business Machines Corp., Johnson Controls, L and T Technology Services Ltd., Legrand SA, Panasonic Holdings Corp., Robert Bosch GmbH, RTX Corp., Schneider Electric SE, Siemens AG, Smarteh d.o.o., Snap One LLC, Softdel System Pte. Ltd., Switch Automation, and Verdigris Technologies Inc.
Technavio market forecast the an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The market analysis and report forecasts market growth analysis by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
The market is witnessing a surge in adoption driven by PoE solutions and IoT-enabled devices for building maintenance and energy savings. Lighting control systems and automated building controls enhance efficiency, while GSMA and 5G networks bolster connectivity for IoT devices. However, concerns over cyber-attacks persist, urging the integration of robust security measures like Closed-Circuit Televisions (CCTVs) and secure power supplies. Smart connected devices and energy management systems (EMS) optimize safety & security management and energy management alongside heating, ventilation, and air conditioning (HVAC) systems, shaping the future of sustainable and intelligent buildings.
Additionally, in the realm of smart buildings, PoE solution and building Internet of Things (BIoT) integrations are revolutionizing infrastructure, yet the looming threat of cyber-attack demands stringent security measures. Elevating safety, passenger lifts are equipped with Internet-of-Things (IoT) technology and monitored through Connect Box systems. Addressing environmental concerns, smart buildings combat greenhouse effects through energy-efficient practices. Original equipment manufacturers (OEMs) play a pivotal role in providing innovative solutions for both the safety & security management segment and the energy management segment, driving advancements in sustainable and intelligent building technologies.
Market Scope |
|
Report Coverage |
Details |
Page number |
187 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 10.61% |
Market Growth 2024-2028 |
USD 64.84 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
9.32 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
APAC at 31% |
Key countries |
US, China, Japan, France, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
ABB Ltd., Advantech Co. Ltd., BuildingLogiX, Cisco Systems Inc., Delta Electronics Inc., Emerson Electric Co., Honeywell International Inc., International Business Machines Corp., Johnson Controls, L and T Technology Services Ltd., Legrand SA, Panasonic Holdings Corp., Robert Bosch GmbH, RTX Corp., Schneider Electric SE, Siemens AG, Smarteh d.o.o., Snap One LLC, Softdel System Pte. Ltd., Switch Automation, and Verdigris Technologies Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Component
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Get lifetime access to our
Technavio Insights
Cookie Policy
The Site uses cookies to record users' preferences in relation to the functionality of accessibility. We, our Affiliates, and our Vendors may store and access cookies on a device, and process personal data including unique identifiers sent by a device, to personalise content, tailor, and report on advertising and to analyse our traffic. By clicking “I’m fine with this”, you are allowing the use of these cookies. Please refer to the help guide of your browser for further information on cookies, including how to disable them. Review our Privacy & Cookie Notice.