Increased urbanization is creating social and environmental challenges such as water shortages, power deficits, pollution and waste water and sewage problems. To combat these challenges, governments of emerging and developed economies are focusing on smart buildings to provide the best integrated solutions. This, according to recent smart building market research, also draws attention to some of the challenges facing construction of smart buildings, including lack of finances in developing countries.
The adoption of the public private partnership model is helping public companies that have easy access to finances lynch up with private players who are struggling to find funding for smart buildings, according to the report Global Smart Building Market 2015-2019. This public private partnership model ensures that private companies easily receive the construction permits associated with smart buildings and public players get an access to the advanced technology and expertise offered by private players. The report forecasts a steady growth for worldwide smart building industry at nearly 12 percent CAGR with rapid urbanization being one of the major market growth drivers.
A smart building connects building automation systems (BAS) with the normal operations of a building such as HVAC, lighting, water supply, and fire emergency. It monitors and controls the energy usage of the building and helps in saving and improving the energy efficiency of the building. The concept of smart building has gained popularity worldwide as home developers have started to realize that these buildings are economical in the long run. In the recent years, several technological advancements have enabled building operators to monitor the real-time activities of the buildings, which when combined with BAS helps in controlling the lighting and energy systems.
Energy demand is expected to increase by 40 percent between 2010 and 2040, which is likely to enhance the growth of the smart building market as it plays a vital role in contributing to energy saving. Smart buildings help tackle the energy crisis problems in developing and developed countries. With the increasing demand of energy management solutions implementation in building, major players are also investing a major portion of their revenue in the research and development of new and innovative products related to the market, according to Building Automation System (Physical Security, BEMS, Building Communication, Parking Management, Plumbing & Water Management, Elevators & Escalators Management), by Application & by Region – Global Forecast to 2020. Key government initiatives include the regulation of Commercial Building Initiatives (CBI) by the U.S. government to make commercial buildings completely energy independent by 2025.
According to this report, the smart building market is expected to grow from $7,260.0 million in 2015 to $36,398.7 million by 2020, at a CAGR of 38.0 percent from 2015 to 2020. Regionally, Europe holds the largest market size, whereas APAC is expected to be the fastest-growing region.