Government Buildings Market Report 2025

The government buildings market size has grown steadily in recent years. It will grow from $53.95 billion in 2024 to $55.07 billion in 2025 at a compound annual growth rate (CAGR) of 2.1%. The growth in the historic period can be attributed to government infrastructure investments, population growth and urbanization, policy changes and regulatory requirements, modernization and upgrading, security and safety concerns.

The government buildings market size is expected to see steady growth in the next few years. It will grow to $61.01 billion in 2029 at a compound annual growth rate (CAGR) of 2.6%. The growth in the forecast period can be attributed to sustainable and green building practices, smart infrastructure integration, public-private partnerships (PPPs), changing work dynamics, demographic shifts and community services. Major trends in the forecast period include accessibility and inclusivity, renovation and retrofitting of existing structures, digital transformation in government services, collaboration and co-working spaces, incorporation of biophilic design.

The rising government expenditure is anticipated to stimulate growth in the government buildings market in the future. Government expenditure refers to the funds allocated by the government for various goods and services. Government buildings, including hospitals and schools, are part of this expenditure, contributing to the development of essential infrastructure. In August 2024, the Office for National Statistics, a UK-based government department, reported that the central government's total expenditure in July 2024 amounted to £107.4 billion, which is £3.5 billion higher than in July 2023. This increase of £3.5 billion reflects the overall rise in spending. Consequently, the growing government expenditure is propelling the expansion of the government buildings market.

The growth of the government buildings market is further expected to benefit from the rising trend of urbanization. Urbanization, characterized by the transformation of rural areas into urbanized regions due to economic development, is anticipated to drive investments in the construction, renovation, and modernization of government buildings. The World Bank Group reported in April 2023 that more than half of the global population currently resides in urban areas, with projections indicating a surge to 6 billion urban residents by 2045. This uptick in urbanization is identified as a significant factor propelling the growth of the government buildings market.

Major companies in the government buildings market are concentrating on developing innovative solutions, such as net-zero buildings, to decrease energy consumption, reduce carbon emissions, and achieve sustainability objectives. Net Zero Buildings are designed to generate as much energy as they consume over the course of a year. For example, in July 2024, Mahindra Group, an automobile manufacturing company based in India, collaborated with Johnson Controls, an Ireland-based firm, to launch the Net Zero Buildings Initiative aimed at decarbonizing commercial, urban residential, and public buildings in India. This initiative intends to offer a comprehensive, cost-free toolkit and training for building owners and facility managers to facilitate their transition to net-zero practices. Starting in March 2024, the initiative will feature workshops to equip stakeholders with essential knowledge and resources. By partnering with government entities and industry associations, the initiative aims to enhance the visibility of building data for climate progress, addressing the substantial emissions and energy consumption linked to the building sector in India.

Sustainability and green building practices have become a significant and growing trend in the government building market. These practices involve the design, construction, and operation of structures in an environmentally responsible way to minimize resource consumption, reduce environmental impact, and promote long-term ecological balance. Governments are increasingly prioritizing environmentally friendly construction by incorporating energy-efficient designs, renewable energy sources, and eco-friendly materials into their building projects. For instance, in November 2023, the Biden administration in the U.S. announced a $2 billion investment in 150 federal building projects across 39 states that utilize materials designed to minimize carbon emissions. The General Services Administration will prioritize the procurement of asphalt, concrete, glass, and steel that are produced and disposed of with lower associated greenhouse gas emissions. This initiative is part of the administration's broader efforts to combat environmental change through government purchasing power.

In October 2022, Pike Construction Services, a U.S.-based construction company specializing in construction management and development services, acquired Charles A. Gaetano Construction Corporation and C2C Construction Solutions, LLC for an undisclosed amount. This acquisition is expected to enhance Pike's position in Utica, the Central New York region, and the entire Northeast, while increasing the value provided to its current and potential clients. Charles A. Gaetano Construction Corporation and C2C Construction Solutions, LLC are U.S.-based providers of construction services, including those for government buildings.

Major companies operating in the government buildings market include China State Construction Engineering Co. Ltd., Shanghai Construction Group Co. Ltd., Clark Construction Group LLC, The Whiting-Turner Contracting Company, Turner Construction Company, Balfour Beatty plc, Greenland Holding Corp. Ltd., Obayashi Corporation, Daiwa HouseIndustry Co. Ltd., HOCHTIEF Aktiengesellschaft, Vinci S.A., Bouygues SA, Kajima U.S.A. Inc., Bechtel Corporation, Skanska AB, Fluor Corporation, STO Building Group, Jacobs Solutions Inc., WSP Global Inc., Alfa Tech Ltd., AECOM Technology Corporation, DPR Construction, PCL Construction Enterprises Inc., Brasfield & Gorrie LLC, JE Dunn Construction, McCarthy Holdings Inc., Hensel Phelps Construction Co., Suffolk Construction Company Inc., Summit Contracting Group Inc., McShane Construction Ltd., Ajax Building Co., HITT Contracting Inc., Harkins Builders Inc., Kiewit Corporation.

Asia-Pacific was the largest region in the government buildings market in 2024. The regions covered in the government buildings market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the government buildings market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Government buildings are structures that serve as the collective housing for various government offices, facilitating the administration of legal and civic affairs within an organized community.

The primary types of government buildings are institutional buildings and commercial buildings. Institutional buildings encompass structures used in industries such as healthcare, education, recreation, or public works. These buildings may include non-residential smart buildings and traditional buildings. They cater to diverse end-users, including both private and public entities.

The government buildings market research report is one of a series of new reports that provides government buildings market statistics, including government buildings industry global market size, regional shares, competitors with a government buildings market share, detailed government buildings market segments, market trends, and opportunities, and any further data you may need to thrive in the government buildings industry. This government buildings market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The government buildings market includes revenues earned by entities by constructing government buildings such as municipal administration buildings, maintenance facilities, office buildings, government parking facilities, parks and recreation facilities. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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