Green buildings are the newest tactic being adopted by governments globally to help combat harmful emissions. According to new research from Technavio, the global green building materials market is expected to top $260 billion by 2019, growing at a CAGR of 13.21% over the next four years.
Green building materials by region
In 2014, Europe accounted for the highest share of the global green building materials market, followed by North America and the APAC region.
However, the APAC is expected to witness high growth in this area, especially in countries like India, Singapore, Malaysia, and Indonesia. Government initiatives, the participation of building owners, and rising urban populations are all expected to trigger demand for green construction (and materials) during the forecast period.
Technavio analysts have broken down the market into these key geographies in order to provide an overview of how countries in North America, Europe and the APAC region are approaching green building.
Green building: North America
The green building materials market in North America is driven by large-scale investment in green building construction in the region, which in turn is propelling the demand for green building materials on the continent.
According to the US Green Building Council, as of July 2015, there are 53,908 LEED certified and registered green building projects in the US, and it is estimated that an investment of more than $800 billion will be made by building owners in the US between 2015 and 2023 to update existing infrastructure to comply with green certifications. This will specifically encourage demand from the roofing and insulation segments in the country. All told, over 35% of non-residential buildings will be built using green building materials in the next two years and the American green building market will see a CAGR of 12.55% from 2014-2019.
Green building: Europe
In 2014, Europe accounted for the highest share of the global green building materials market, with an overall market value of $58.85 billion. This is primarily driven by large-scale initiatives by European governments to retrofit buildings to comply with green building standards. The green building materials market in Europe is expected to grow at a CAGR of 13.01% from 2014-2019.
In January 2015, Europe’s Green Building Council, a non-profit organization launched an ambitious two-year project to renovate existing buildings in 13 countries. The total project cost is estimated to be around $2 billion and will be funded by the EU’s Horizon 2020 program.
Additionally, large-scale investment is being put towards development of commercial green building in countries like Turkey, the UK, and France, which will drive the market in the next five years. For instance, in January 2015, the Turkish Ministry of Environment and Urbanization signed a contract with a construction firm for the development of the first green and energy-efficient public building.
Green building: APAC
The green building materials market in the APAC region was valued at $29.43 billion in 2014. The market is still in its nascent stage, but the influx of new government regulations in green building construction will drive growth over the next five years.
Additionally, rising penetration of green building construction in countries like Singapore, India Indonesia, Malaysia, and China is expected to further propel the demand for green building materials.
According to BCA, in Singapore, as of 2014 there were 2,155 green building construction projects on the go. In the same year, the India Green Building Council announced its plan to construct 10 billion square feet of environmentally friendly space in the country by the end of 2022.
This kind of initiative by the state authorities across these countries will drive aggressive growth in the green building materials market through the forecast period.