Global smart building technology spending is forecast to grow from $6.3 billion in 2014 to $17.4 billion in 2019, registering a compound annual growth rate (CAGR) of 22.6 percent, according to a new report from IDC Energy Insights. The most aggressive adoption will be in Asia/Pacific, North America, and Western Europe.

After several years of slower-than-expected growth, the smart building technology market is expected to grow rapidly as there is increasingly broad market awareness of the business values generated by deploying smart building solutions. Smart buildings enable facility optimization through the convergence of information technology and building automation. Building owners and key decision makers are increasingly aware of the business value of these solutions. In fact, the 2015 IDC MarketScape on Smart Building solutions (forthcoming) shows that over 90 percent of firms will increase their investment in smart building technologies once the methodology for valuing those investments becomes more widely accepted and standardized.

Key findings from the report include:

• Although the overall pace of adoption is slightly lower than predicted last year, more competitive pricing and technology advances will result in a higher level (and more ‘smarter’ buildings) in the years ahead.

• Despite the aggressive growth of the smart buildings market (a global CAGR of 22.6 percent), adoption still represents a small share of the total addressable market. The continued development of case studies and best practices by early adopters will promote awareness and support longer-term expectations for market expansion.

• In 2015 and beyond, adoption is anticipated to recover as the economic recovery takes hold and as energy costs remain a large and variable component of building operation.

“While the ‘Internet of Things’ is a topic of much speculation in the consumer market, smart building technology has steadily been increasing its footprint and impact among commercial buildings. Smart building solutions are valuable technologies for deploying energy management strategies that generate operational efficiencies, cost containment, and sustainability benefits that appeal to key stakeholders in building management,” said Jill Feblowitz, vice president, IDC Energy Insights.