Report Overview

Growing investments in smart cities projects, countrywide urban redevelopment projects across Ukraine and Türkiye, an increasing demand for energy-efficient systems, and the growing adoption of 5G technology could boost the growth of Europe smart building market during the forecast period between 2023 and 2029.

Europe Smart Building Market - Industry Trends & Forecast Report, 2029

Europe smart building market size was estimated at USD 4.15 billion in 2022. During the forecast period between 2023 and 2029. Europe Smart building market size is projected to grow at a CAGR of 16.65% reaching a value of USD 12.12 billion by 2029. The increased demand for better building (and building premises) usage as well as improved resource management in urban areas is driving the rapid adoption of smart buildings in many different regions. The market for smart buildings is expanding due to the rising demand for public safety and security. It is projected that during the forecast period, the advent of artificial intelligence in smart buildings and the growth of the IoT market and its use in smart buildings would present some chances for the market's growth.

Europe Smart Building Market- Overview

A smart building is a structure that controls building functions such as heating, ventilation, air conditioning, lighting, security, and other systems using IoT and automated technologies. A smart building collects and manages data using sensors, actuators, and microchips following an organization's functions and services (or household). Such smart infrastructure solutions help building owners, operators, and facility managers improve asset dependability and performance, reduce energy consumption, improve space utilization, and reduce the environmental impact of buildings.

Growth Drivers

Growing Demand for Efficient Resource Utilization

Businesses (or inhabitants) may benefit from having access to efficient resource management capabilities due to smart building management technologies. For instance, the automated scheduling and monitoring tools made possible by networked sensors enable better resource management, including better water and power management. IoT-capable devices can offer automated control over a variety of operational areas, including inventory management, delivery tracking, fuel management, and replacement part management. For instance, tracking the location of supplies and equipment inside the facility can be done using RFID tags and a sensor network. These use cases of smart building technologies provide significant growth opportunities for Europe smart building market.

Focus on Reducing Energy Cost and Encouraging Sustainability

For commercial buildings, preserving sustainability and reducing carbon footprint can be difficult. Non-residential buildings use 40% more energy on average than residential buildings, according to a research study. Also, commercial buildings waste more than 30% of the energy. These issues are bringing attention to the need for smarter building management solutions, which provides growth prospects for the development of smart building solutions. Many countries have strict regulations for building contractors to guarantee that structures employ appropriate energy-saving techniques and have efficient resource management systems in place. Such laws encourage the expansion of the market for smart buildings.

Nationwide Urban Redevelopment Projects in Türkiye and Ukraine

Major companies in Europe smart building market are expected to gain from significant opportunities provided by the massive infrastructure redevelopment projects in earthquake-hit Türkiye and war-ravaged Ukraine.

On February 06, 2023, a 7.8-magnitude of earthquake hit Türkiye and Syria, killing tens and thousands of people and severely damaging infrastructure in cities and villages across its fault line. The President of Türkiye announced that the government would engage in a comprehensive construction program to rebuild cities with safety and sustainability. Analysts estimated that the urban redevelopment & recovery across Türkiye post the massive earthquakes would provide growth opportunities for the construction and related industries in total investment of more than USD 250 billion.

Russia’s war in Ukraine has been continuing for more than a year now. Consequently, infrastructure across Ukraine has been severely damaged. In September 2022, Ukraine government, the European Commission, and the World Bank, along with their partners estimated the cost of Ukraine’s reconstruction and recovery would be about USD 350 billion. As the war continues, the cost is anticipated to escalate.

Redevelopment and recovery projects in Türkiye and Ukraine with massive investments are expected to provide lucrative growth opportunities for construction and supplementary industries. It, in turn, is projected to aid the growth of Europe smart building market during the forecast period between 2023 and 2029 and beyond.

Restraints

Rising Energy Prices and Environmental Issues

Energy prices are rising rapidly, and environmental issues are a major concern today. To save money, there is increasing pressure to provide more energy-saving solutions. As energy conservation has become more important in recent years, so has the demand for smart buildings. To save money, commercial building owners and managers prioritize energy consumption reduction. According to the US Energy Information Administration, commercial and residential buildings consume nearly 40% of the country's energy.

Impact of COVID-19 on Europe Smart Building Market

To control the spread of COVID-19, governments around the world imposed countrywide lockdowns. Manufacturing operations were impacted by the lockdown restrictions, with facilities either completely shutting down or operating at reduced capacity to ensure social distancing and employee safety. Most industries came to a halt as a result of raw material and labor shortages, supply chain disruptions, and international trade restrictions. Many businesses, including smart buildings, were affected by the pandemic. The pandemic had a significant impact on building technologies operations and business activities; however, most segments of this industry recovered in the first quarter of 2021.

Europe Smart Building Market

Segmental Coverage

Europe Smart Building Market - By Type

Europe smart building market is divided into Solutions (Safety & Security Management, Access Control Systems, Video Surveillance Systems, and Fire & Life Safety Systems), Energy Management (HVAC Control System, Lighting Management System, Others (Data Management, Asset Performance Optimization, and Application Platform), Building Infrastructure Management (Parking Management System, Water Management System, and others (Elevators & Escalators Management and Waste Management)), Services (Consulting, Implementation, and Support & Maintenance). According to solution type, the security & emergency management (SEM) segment dominated Europe smart building market share and is expected to maintain this trend during the forecast period. This is due to the growth in the demand for smart infrastructure solutions, which in turn is fueling the demand for real-time security & emergency management. However, the market for green and sustainable building management systems could grow at a faster rate in the coming years, favoring the energy management category. The smart energy market segment is also expected to be driven by several government measures that boost the use of smart energy technologies.

Europe Smart Building Market - By Building Type

Based on building type, Europe smart building market is divided into Residential, Commercial, and Industrial segments. The commercial sector is expected to hold the highest market share for smart buildings worldwide. The increasing focus on intelligent buildings by stakeholders including developers and owners of commercial real estate (CRE) to lower operating costs is responsible for the segment's growth. Governments are closely examining CRE to considerably increase investment and enhance building practices that save energy. However, it is expected that throughout the forecast period, the residential category will increase at the fastest rate. Growth in this market is expected to be fueled by rising demand for smart home lighting, HVAC monitoring, smart door locking systems, and smart meters.

Europe Smart Building Market - By Country

Geographically, the Europe smart building market covers Germany, UK, Italy, France, Spain, Netherlands, and Rest of Europe. Germany dominates the market share. Because of the presence of a highly developed ICT sector and high spending, the smart building market is expected to grow. However, the UK is expected to grow significantly during the forecast period as a result of various government initiatives and digital transformation trends in the region, which will fuel the smart building market analysis in this region.

Competitive Landscape

Competition in Europe smart building market is intense. Major companies in the market include ABB Ltd., Cisco Systems Inc., Emerson Electric Co., Hitachi, Ltd., Honeywell International Inc., Johnson Controls, Legrand, Schneider Electric SE, Siemens, IBM Corporation, and Telit. The key strategies used by these market leaders are new product launches, mergers & acquisitions, and alliances. To grow their market share, these companies are also focusing on investing in innovations, collaborations, and expansions.

Recent Developments

• In December 2020 - GEZE, an innovation and building services engineering company, launched ActiveStop door damper to help owners and tenants easily retrofit themselves. The solution is an alternative to standard door stoppers. It is said to ensure that the opened door does not accidentally crash or slam into walls and furniture.

Scope of the Report

By Component

• • Solutions

    1. Safety & Security Management

    2. Access Control System

    3. Video Surveillance System

    4. Fire And Life Safety System

• • • Energy Management

• • 1. HVAC Control System

    2. Lighting Management System

    3. Others (Data Management, Asset Performance Optimization, Application Platform)

• • • Building Infrastructure Management

• • 1. Parking Management System

    2. Water Management System

    3. Others (Elevators & Escalators Management, Waste Management)

  • Services

    1. Consulting

    2. Implementation

    3. Support & Maintenance

By Building Type

• • Residential

  • Commercial

  • Industrial

By Country

• • Germany

  • UK

  • Italy

  • France

  • Spain

  • The Netherlands

  • Rest of Europe