Market Research Shows Opportunities in Green Building

In 2005, green building was a small, burgeoning market, approximately 2% of both nonresidential (commercial and institutional) and residential construction, valued at a total $10 billion–$3 billion for nonresidential and $7 billion for nonresidential. Since that time, green building has expanded rapidly due to a number of factors such as growing public awareness of green practices, and heavy increase in government.

McGraw-Hill Construction’s Green Outlook

New York, NY – November 12, 2010 – The U.S. green building market is accelerating at a dramatic rate, says McGraw-Hill Construction’s Green Outlook 2011: Green Trends Driving Growth report. The value of green building construction starts was up 50% from 2008 to 2010— from $42 billion to $55 billion-$71 billion— and represents 25% of all new construction activity in 2010. According to projections, the green building market size is expected to reach $135 billion by 2015.

Green building is the bright spot in an otherwise tough economy, and in some sectors, that rate of growth has been remarkable. In nonresidential building, for example, the green building market share is even higher than the overall market. Today, a third of all new nonresidential construction is green— a $54 billion market opportunity. In five years, nonresidential green building activity is expected to triple, representing $120 billion to $145 billion in new construction (40%-48% of the nonresidential market) and $14 billion to $18 billion in major retrofit and renovation projects.

To break it down further, health care construction this year is expected to grow its green share to as much as 40% (valued at $8 billion-$9 billion in 2010)— phenomenal growth in just two years. Education (valued at $13 billion–$16 billion in 2010) and office green construction (valued at $7 billion–$8 billion in 2010) also remain strong sectors, showing high increases in market share, due in part to the fact that bigger projects are the most likely to “go green.” This year, the U.S. Green Building Council’s LEED specification is mentioned in 71% of all projects valued at over $50 million.

“It’s an amazing area of opportunity at time when the construction market is extremely challenged,” said Harvey M. Bernstein, vice president, Global Thought Leadership and Business Development, McGraw-Hill Construction. “In today’s economy, firms that specialize in green or serve this market are seeing a tremendous advantage— and they’re doing good at the same time. Green building leads to healthier places for us to live and work in, lower energy and water use, and better profitability.”

McGraw-Hill Construction research shows a 5X growth in market share for green buildings since 2005, and anticipates as much as 2X to 3X growth between 2008 and 2013. 

• Environmental Leader:  Environmental and Energy Management News

From 2010 to 2015, the total US green building market value is projected to increase from $71.1 billion to $173.5 billion, according to the latest issue of EL Insights. This represents a CAGR of 19.5% during this time period. In addition, commercial green building is projected to grow by 18.1% annually, according to new research revealed in EL Insights, from $35.6 billion to $81.8 billion. EL Insights also reveals that green building is a source of economic opportunity and has potential to create 2.5 million American jobs, which is about a 30% increase in jobs within the construction industry.

• National Renewable Energy Laboratory

According to the National Renewable Energy Laboratory, the lack of a skilled workforce is the largest nontechnical barrier to the advancement of renewable energy and energy efficiency technologies. There is a burgeoning demand for individuals familiar with green construction, green auto maintenance, and green manufacturing. Online courses and programs are growing at an alarming rate, and every type of training is now available to anyone, at home, and for a reasonable price.  In addition, most community colleges are offering some kind of green building program in their continuing education program or regular accreditation program.

• Zpryme Research and Consulting

Another recent study also indicates high growth in the green building sector. According to research from Zpryme, the combined commercial and residential green building markets should grow nearly 146 percent from 2009 to 2013, representing a $128.6 billion market by 2013. The study also reveals that the commercial/institutional market for green building could grow 137 percent from 2009 to 2013, from $26.5 billion to $63 billion.