Australia Green Building Market Assessment, By Product Type [Exterior Products, Interior Products, Building Systems, Construction Materials, Others], By Building Type [Residential, Commercial, Industrial, Institutional, Public Infrastructure], By Applicat

Australia green building market is projected to witness a CAGR of 9.78% during the forecast period 2025-2032, growing from USD 8.21 billion in 2024 to USD 17.36 billion in 2032. The Australian green building sector has experienced historic growth over the last decade with greater concern for minimizing climate change, energy efficiency, and environmental sustainability. Green buildings, which are specifically designed to minimize environmental impacts through efficient use of energy, water, and material usage, have now become the norm for the Australian building sector. It is complemented by sound government policy, industry certification, and standards such as the Green Star rating system of Australia's Green Building Council (GBCA). The programs force developers, builders, and architects to green up, resulting in a green residential, commercial, and public building boom in Australia.

Australia's push to reduce carbon emissions and become net-zero compliant has also pushed the adoption of green building practices. Green building practices, smart technologies, and innovative design solutions have propelled the nation to the top ranks of sustainable development globally. The demand for healthier and energy-efficient residences has also grown, with consumers and companies embracing the long-term benefits of green buildings.

For instance, in December 2024, Australian Green Building Council (GBCA) received the outcome of Adelaide's Energy and Climate Change Ministerial Council meeting with gratitude as a significant move toward affordable, sustainable, and just energy future. The release of the new Home Energy Ratings Disclosure Framework (Version 2), and its comprehensive cost-benefit analysis, is a breakthrough in national energy disclosure consistency. The GBCA strongly supports the initiative as it is completely in compliance with policy direction in all Building Counts reports, and with a vision to present an energy-efficient and sustainable built environment.

Accelerating Australia’s Green Building Market Through Innovation and Policy Support

Driving Australia's green building sector is a combination of innovative technologies and policies. The sector is expanding rapidly due to government policies that promote environmentally friendly buildings and raise consumers' and developers' environmental awareness. Policies offering rebates and incentives for applying green products and energy-efficient technologies also drive expansion. Apart from that, utilizing smart building technology and alternative sources of energy like solar panels has become more popular because it causes less greenhouse gas emission and maximizes energy efficiency.

The emphasis on green building products, including recycled steel and low-carbon concrete, is also central to pushing the market. Consumer demand for healthier and greener living environments is also a powerful driver, prompting developers to include green approaches in residential, commercial, and public infrastructure developments1. Furthermore, Australia's leadership in green building is matched by robust certification schemes, which verify that buildings meet high levels of sustainability. This commitment to sustainability helps the environment and has business advantages through increased occupant health and productivity.

For instance, in July 2024, the Australian Green Building Council launched Green Star Performance v2, a major revamp of its sustainability rating system. Designed to respond to evolving global expectations, the new system sets higher standards for energy efficiency, resource consumption, and environmentally friendly building practices. The update captures environmental gains to ensure buildings are part of a more sustainable future. Green Star Performance v2 will encourage innovation and accountability in the building industry to move Australia toward more sustainable development.

Technological Advancements in Construction Drives the Australia Green Building Market Growth

Technological innovation in the construction sector leads the Australian green building sector primarily. These encompass the discovery and application of green products, green systems for optimum utilization of energy, and innovative green building designs with no environmental impact. The use of green materials such as recycled concrete, low-carbon cement, and wood products sustainably harvested minimizes waste and emissions to maximize environmental sustainability and cost-effectiveness through minimized maintenance and operating expenses. Further, the use of new technologies such as solar panels, green roofs, and smart building systems maximize energy efficiency and minimize carbon footprints to maximize building performance and indoor health.

Today's building design strives to optimize natural light, ventilation, and green space to make the occupants healthier and more productive. Building designs also prefer the possibility of biodiversity as well as reducing the urban heat island effect. Stricter building energy codes, as well as green building incentives like Green Star, also push builders to be greener and hence encourage greener buildings in the market to consumers and investors. Increasing investor focus on Environmental, Social, and Governance (ESG) issues also calls for green buildings as they are long-term value assets sustainability.

For instance, in July 2023, the South Australian Government, Hallett Group, and Korean companies Elecseed and Korea Hydro and Nuclear Power (KHNP) executed a Statement of Cooperation with the objective of easing the progress of a green cement processing plant project in Port Augusta, South Australia. The project is an exhibition of the spirit of collaboration towards green building technology and environmental cost savings in the green building sector, demonstrating the emphasis on innovation and sustainability in the Australian building sector.

Residential Buildings are Expected to Hold the Largest Market Share

The Australian green buildings sector will see enormous growth in the coming times, and residential structures will take the lead in the market. The growth is being driven by increased demand for environmentally friendly housing structures, particularly multi-unit housing plans. Government policies, increased energy needs, and utilization of sustainability certificates like Green Star aid the growth. The residential market is supported by measures that encourage occupant health and wellbeing, in accordance with broader societal pressures towards healthier and more energy-efficient living. Market demand, client preference, and environmental considerations are the primary drivers, more so in Australia than abroad. The increasing importance of ESG investments and the increasing value of green real estate assets also underpin the potential of the market.

For instance, in October 2024, the Green Building Council of Australia made a statement regarding the release of the Green Star Buildings Apartments Pathway. The pathway offers apartment-based requirements and credits to promote further sustainability in apartment-type multi-unit residential buildings. It provides a pathway to more sustainable, more efficient apartments with unit-level certification for the first time. The route assists developers in realizing growing expectations of sustainability and assures customers and tenants of high-performance levels.

Western Australia Holds the Largest Australia Green Building Market Size

Western Australia (WA) possesses the largest share of Australia's green building industry, driven by its pursuit of green conservation and sustainable development. WA has seen a green building boom, which has been helped by government policy, proactive environmental management policy, and rising demand for energy-efficient buildings. WA's pursuit to reduce carbon emissions and promote the use of renewable energy has led it to become a leader in green building. The Australian Green Building Council (GBCA) has been at the forefront of driving certification of a diverse array of projects under the Green Star rating system, pushing WA's green building sector forward.

Western Australia's Perth is a hub of green building design nowadays, with solar power, recycled water, and sustainable materials that grace commercial and residential buildings. The technology of green buildings has also gained momentum in the state's mining industry in the form of environmentally conscious buildings to lessen its footprint on nature.

Development Western Australia secured its third 6 Star Green Star Communities for the Subi East precinct, following Alkimos Beach and Montario Quarter. The 35-hectare revival will deliver 2,700 dwellings, ranking sustainability above 33 rival factors. Householders will save on power bills, enjoy substantial public space, reduce urban heat, and amplify community identity by virtue of such factors as referencing sustainability, aboriginality, and footy history. This is a triumph for development in western Australia since it leads the way in the delivery of first-world sustainable metropolitan development, and other states trail behind.

Future Market Scenario (2025-2032F)

The Australian green construction sector is also predicted to grow aggressively with a focus on tough government regulations and a big emphasis on going net-zero by the year 2050. There is increasing worry regarding climate change and energy-efficient building demands that will force the demand for green-certified buildings.

Adoption of highly advanced technologies such as smart building systems, renewable energy integration, and energy-efficient materials will be the key driver of the market. Innovation in new construction methods and green design will also enhance the use of green buildings.

Residential and commercial properties will witness a flow of green buildings. Organizations are placing great emphasis on sustainability to achieve ESG objectives, and residential property owners are placing emphasis on energy-saving and green residential products.

Government incentives to green building companies, including tax credits, grants, and green building rating systems like Green Star and NABERS, will continue to attract investors and builders to embrace more environmentally friendly ways of building. This will create the conditions necessary to drive the market for green building to expand in Australia.

Key Players Landscape and Outlook

Australian green building sector is growing strongly with the boost from rising environmental awareness, regulation, and demand for green building practices. The market leaders in this sector are Saint-Gobain Solar Gard Australia Pty. Ltd., Knauf Insulation Pty. Ltd., and Schneider Electric Buildings Australia Pty. Ltd. are all enthusiastically embracing green building practices in their projects. These companies are adopting new technologies, energy-efficient products, and alternative energy sources to achieve sustainability and Green Star ratings by the Green Building Council of Australia (GBCA). Besides that, multinational corporations like Saint-Gobain are widening their bases in their home markets, so competition and innovation become even greater.

The future is bright, and the green building sector has room to grow incrementally with growing demand for green infrastructure and net-zero buildings. Government support in terms of the National Construction Code (NCC) and Trajectory for Low Energy Buildings also favors green adoption. However, high upfront costs and the need for specialized labor are drawbacks.

In February 2024, Saint-Gobain announced to acquire of CSR Limited, an Australian construction industry record deal. Australia's leading building products group, CSR brings diversity to Saint-Gobain's operations through its famous brands and brand presence around the world. The acquisition is a part of Saint-Gobain's ""Grow & Impact"" strategy for a sustainable building solutions future and reinforces its leadership in the Asia-Pacific, propelling growth and innovation in green building materials.