Smart Buildings Market Scenario 2035

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Growing Urbanization and Technological Advancements Will Positively Impact the Global Smart Buildings Market at a CAGR of 18.66% During the Forecast Period 2025 to 2035

Market Research Future (MRFR) has published a cooked research report on the “Global Smart Buildings Market” that contains information from 2019 to 2035. The Smart Buildings Market is estimated to register a CAGR of 18.66% during the forecast period of 2025 to 2035.

MRFR recognizes the following companies as the key players in the Global Smart Buildings Market — Control4 Corporation, HCL Technologies Limited, Panasonic Corporation, Advantech Co. Ltd, Johnson Controls International PLC, Hitachi Ltd, Sony Corporation, IBM Corporation, Cisco Systems, Honeywell International Inc., Emerson Electric Co., Overkiz, ABB Group, Huawei Technologies Co. Ltd, and Siemens AG.

Smart Buildings Market Highlights

The Global Smart Buildings Market is accounted for to register a CAGR of 18.66% during the forecast period and is estimated to reach USD 850,717.08 billion by 2035, up from USD 129,525.68 billion in 2024.

The market growth is driven by advancements in IoT, artificial intelligence, and cloud computing, coupled with government support for energy-efficient infrastructure and the rising need for sustainable building practices. Smart buildings leverage intelligent systems and sensor-based technologies to optimize energy consumption, improve operational efficiency, and enhance occupant comfort.

The commercial segment remains dominant, contributing approximately 46.24% of total market revenue in 2022, owing to the growing adoption of building automation systems in offices, retail spaces, and hospitality sectors. North America holds the largest market share of 36.87%, supported by strong regulatory frameworks and early technological adoption.

A key driver of market expansion is the global shift toward sustainability and carbon neutrality. With buildings accounting for nearly 42% of global electricity consumption, the adoption of smart solutions such as energy management systems (EMS), IoT-enabled infrastructure, and predictive analytics has become crucial for reducing energy waste and operational costs.

For instance, leading players like Johnson Controls, Siemens, and Honeywell have expanded their smart building portfolios to integrate AI-based energy optimization, real-time monitoring, and predictive maintenance. ABB Group and Huawei Technologies have also introduced advanced IoT and connectivity platforms, enabling seamless integration of building systems.

Segment Analysis

The Global Smart Buildings Market has been segmented based on Solution Type, Technology, Application, Building Type, and Functionality Type.

Based on Solution Type, the market includes Building Automation Systems (HVAC, Lighting, Elevators), Energy Management Systems, Security and Access Control Systems, IoT-Enabled Infrastructure, and Communication Systems.

The Energy Management Systems (EMS) segment dominated in 2024 and is projected to be the fastest-growing. EMS optimizes energy flows using advanced analytics, reducing emissions and stabilizing power grids.

Based on Technology, the market includes Artificial Intelligence (AI), Internet of Things (IoT), Cloud Computing, Blockchain, AR/VR, and Others.

The IoT for Device Connectivity segment dominated in 2024, while AI for Predictive Maintenance is expected to grow at the fastest rate. IoT enables real-time automation, while AI enhances energy forecasting and operational decision-making.

Based on the Application, the market includes Energy Optimization and Management, Space Management, Safety and Security Enhancement, Predictive Maintenance and Analytics, and Environmental Monitoring.

Energy Optimization and Management led the market in 2024 and will remain the fastest-growing application due to increasing emphasis on sustainability and real-time data analytics.

Based on Building Type, the market includes Residential, Commercial, Industrial, and Institutional Buildings.

The Commercial Buildings segment dominated in 2024, driven by automation in offices, retail complexes, and hotels to enhance comfort and reduce costs.

Based on Functionality Type, the market includes Energy Management Solutions, Building Automation, Security and Access Control, IoT and Connectivity, Space and Occupancy Management, Comfort and Wellness Solutions, Data Analytics and Management, Smart Power Utilities, and Infrastructure Management Solutions.

The Energy Management Solutions segment led the global market in 2024 and is projected to maintain dominance, owing to growing demand for smart meters, battery storage, and IoT-integrated EV charging systems.

Regional Analysis

By Region, the Smart Buildings Market is segmented into North America, Europe, Asia-Pacific, South America, and Middle East & Africa.

North America dominated the global market in 2024, supported by early technology adoption, government incentives, and the implementation of green building standards. The U.S. remains a key hub for smart building technology innovation.

Europe is projected to be the fastest-growing region, with initiatives like the EU Green Deal and stringent carbon emission targets accelerating the integration of smart systems in commercial and residential infrastructure.

Asia-Pacific shows rapid growth due to urbanization, population expansion, and smart city projects in China, Japan, and India.

South America and Middle East & Africa are emerging markets, with rising investments in infrastructure modernization and sustainable energy solutions.

Key Findings of the Study

The Global Smart Buildings Market is expected to reach USD 850,717.08 billion by 2035, at a CAGR of 18.66% during the forecast period.

North America accounted for the largest market share, while Europe is projected to be the fastest-growing regional market.

Based on Solution Type, the Energy Management Systems segment dominated the market in 2024.

Based on Technology, IoT for Device Connectivity was the leading segment in 2024, while AI for Predictive Maintenance is the fastest-growing.

Control4 Corporation, HCL Technologies Limited, Panasonic Corporation, Advantech Co. Ltd, Johnson Controls International PLC, Hitachi Ltd, Sony Corporation, IBM Corporation, Cisco Systems, Honeywell International Inc., Emerson Electric Co., Overkiz, ABB Group, Huawei Technologies Co. Ltd, and Siemens AG are identified as the key market players.