China Smart Building Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The China Smart Building Market is expected to grow at a CAGR of 7.8% over the forecast period (2022 - 2027). The consumer's propensity to adopt security solutions is rising due to the pandemic scenario and the uncertainty of returning to normal life. The aspect of a 'smart building' is looking more practical in the 'new normal' post-COVID-19 in the country. It is not about efficiency or smart usages like smart options of switching on a luminaire or an HVAC, but the practical reality of ensuring fewer instances of touching, if not doing away altogether, off switches to switch on any appliance.

Key Highlights

• A smart building automates its processes to control its infrastructure, lighting, security systems, heating, ventilation, and air conditioning systems. A smart building uses technology and assimilates it with the basic building infrastructure and other structural and equipment components to make buildings increasingly efficient, safer, sustainable, and reduce costs. The studied smart building solutions are part of the growing IoT and connected sensor ecosystem.
• Solutions, such as the Infrastructure Management System, Building Energy Management System, and Intelligent Security System, are currently being adapted for smart buildings. BEMS is an integrated and computerized system for monitoring and controlling energy-related building services, plants, and equipment such as HVAC systems and lighting.
• The adoption of smart technologies in the country could be accelerated by incentivizing the process and by setting up benchmarks. Smart technologies often incentivized through prescriptive utility energy efficiency programs include advanced occupancy and vacancy controls that work with lighting and HVAC systems, daylighting controls, smart power strips, smart plugs, and BMS.
• Moreover, the spike in energy consumption can be controlled by benchmarking. Property owners, facility operators, managers, and designers could use bench marketing to facilitate energy accounting, comparing a facility's energy use to similar facilities to assess opportunities for improvement and quantify/verify energy savings. Smart energy solutions have been adopted to meet the desired benchmark and reduce energy consumption.
• Moreover, the Chinese government frequently promotes smart city cooperation under its Digital Silk Road Initiative, a significant component of the Belt and Road Initiative (BRI). In ASEAN, cooperation is enhanced through the ASEAN-China Strategic Partnership Vision 2030, where China has pledged to support ASEAN's technology transformation initiatives, including the ASEAN ICT Master Plan 2020 and the ASEAN Smart City Network.
• Furthermore, recovery from COVID-19 further forces regional organizations to reimagine their operations for the next normal. Organizations across industries are adapting to emphasize digitalization and automation across their operations. Such changes are expected to impact the requirements for workforce skills and capabilities significantly. This will require two changes across the workforce: upskilling, in which staff gain new skills to help in their current roles, and reskilling, in which staff needs capabilities to take on different or entirely new functions.

Key Market Trends

Infrastructure Management System is Expected to Hold a Significant Market Share

• Smart buildings use sensors, actuators, and microchips to collect and manage data according to a business' functions and services. Infrastructure management systems help owners, operators, and facility managers improve asset reliability and performance, reducing energy use, optimizing space used, and minimizing the environmental impact of buildings. The rising adoption of IoT-enabled infrastructure management systems and raising awareness of space utilization are expected to drive the market's growth in the country.
• The infrastructure management systems scenario is evolving with the arrival of sensors, analytics, and cloud technologies focused on reducing the costs of BMS while at the same time transforming the market dynamics of application manufacturers, systems integrators, and solution providers.
• The current IoT platforms for buildings and infrastructures enable a connection between the building's equipment, which is distributed by devices and sensors that use a wide variety of protocols, which transfer the data they generate to services and applications in the Cloud to be analyzed subsequently by Business Intelligence (BI) systems, analytics, and dashboards. The infrastructure for collecting data of sensors and devices filters and securitizes the information through intermediate protocols and forwards it to a cloud or the data center in the building itself.
• Further, the developers of IoT systems and infrastructure management systems for office buildings and shopping centers in the studied region have realized that integrating environmental control platforms into the architectural infrastructure leads to improved efficiency and significant cost savings. The development of sensor technology and analytics has aided the deployment of internet-based connectivity systems and the demand for smart buildings for large and small structures.
• With IoT sensors monitoring occupancy and reacting accordingly, a connected smart building can automatically respond to occupancy changes by turning off lights and adjusting HVAC systems to reduce consumption, accurately controlling how and where a building should manage its energy.

Residential is Expected to Hold a Significant Market Share

• A smart building creates value by providing an innovative approach compared to non-smart buildings. For instance, Smart sensors can monitor homes for leaks and are used in some communities to help monitor vacant homes. These sensors can communicate in various ways, including cell service, Wi-Fi, 6lowpan, ZigBee, and LoRa. Smart sensors that detect and can prevent dangerous situations from arising in residential.
• The market vendors are actively introducing new solutions. For instance, in January 2020, ADT announced a home security platform. Blue by ADT is the advanced product offering, individual home security parts that clients can install and design with proficient checking and capacity choices.
• Additionally, in August 2020, Google and ADT formed a long-term partnership to create the next generation of smart security solutions. The partnership will combine Google's hardware and services and ADT's DIY and professionally installed smart home security solutions to innovate the residential security industry.
• In December 2020, Guangzhou-based real estate developer Seedland Group released an innovative over-the-air or OTA smart community in Beijing. The system uses OTA, a new cloud-based download technology, to provide services, updates, and information to community members, creating greater convenience and offering a wider range of services.

Competitive Landscape

The China Smart Building Market is significantly competitive owing to multiple vendors providing Smart Building to the domestic and international markets. The market appears to be moderately fragmented, with the significant vendors adopting strategies for mergers and acquisitions and strategic partnerships, among others, to expand their reach and stay competitive. Some major players in the market are Johnson Controls, Siemens Building Technologies, Honeywell International, Schneider Electric, and Hitachi Ltd, among others. Some of the recent developments in the market are:

• May 2021 - Honeywell launched a cloud-based solution for building owners and managers that simplifies and combines operational and business data to support better decision-making, drive greater efficiencies, and achieve sustainability goals.
• February 2021 - Huawei Data Communication Product Line announced the Intelligent cloud network solution Five Ones’ new capabilities, including one hop to the cloud, one network-wide connection, one-click fast scheduling, one fiber for multiple purposes, and one-stop integrated security.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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