Green Buildings Market Trends

Growth Drivers

• Regulatory frameworks and policy incentives: It is evident that government regulation is still the most influential driver of the green building market. Legislations like the EU Energy Performance of Buildings Directive (EPBD) and the U.S. Building Performance Standards (BPS) require mandatory renovations and energy efficiency upgrades by 2030. In April 2024, the World Green Building Council released the European Manifesto for a Sustainable Built Environment, which presents the policy objectives to decrease energy consumption and the use of fossil fuels. Backed by 24 national councils, the program focuses on employment, economic stability and sustainability, and green cities. Such frameworks are not only reshaping the public domain but are also creating new possibilities for the private sector to explore.

• Integration of renewable energy systems in building design: One of the emerging trends in green building is the incorporation of renewable energy sources into the building’s systems. In July 2024, Kingspan Group and LONGi Green Energy Technology partnered to integrate solar solutions into building materials. This synergy contributes to the creation of net-zero infrastructure by integrating photovoltaic technology with the building skin. The alliance is a shift toward the use of integrated elements that produce energy, decrease expenses, and improve design. It demonstrates the increasing importance of energy generation systems as a component of sustainable architecture.

• Corporate climate commitments and innovation in materials: Businesses are sourcing products with low lifecycle emissions and materials for the construction of low-carbon products. In January 2025, Interface launched a carbon-negative Nora rubber flooring sample that aims to have a carbon footprint that is lower than the amount of carbon it captures. This innovation provides answers to the problem of carbon offsets and attempts to directly capture carbon through material science with the goal of achieving new industry standards. These trends are revolutionizing the value proposition of commercial interiors and contributing to a larger trend toward performance-based sustainability in construction materials.

Challenges

• Lifecycle data availability and standardization: One of the key challenges to the growth of the sustainable green building market is the lack of consistency when it comes to lifecycle carbon tracking and emissions data, even with the advancements in sustainable building design. This is attributed to the fact that there is no clear set of metrics and reporting tools that can be used to benchmark the environmental performance of buildings and building materials. This also hampers the ability to have a proper evaluation of the lifecycle impacts of buildings, thus resulting in poor decision-making regarding design and construction.

• Infrastructure readiness and adoption in emerging markets: Due to the lack of well-developed infrastructures and the limited availability of green materials, many emerging economies struggle to implement sustainable construction technologies at a large scale. This can entail challenges such as inadequate energy and water resources, insufficient human resources, and insufficient supportive regulations. However, one of the main challenges of using green building materials and technologies in these markets is the high upfront cost. Therefore, the level of green building uptake remains low in most developing nations compared to developed countries.