How is India's Green Building Market Set to Grow Over 10% Annually to $85 Billion by FY32?
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Synopsis
India's green building sector is on the brink of a significant transformation, with a projected growth rate of 10.5% annually, potentially reaching $85 billion by FY32. This surge is driven by increasing demand for certified spaces, offering notable financial benefits and sustainability advantages.
Key Takeaways
- India's green building market is growing rapidly, projected at 10.5% CAGR until FY32.
- Market opportunity expected to reach $85 billion.
- Certified spaces have a 3x higher supply than non-certified.
- Green buildings yield superior financial returns and lower operating costs.
- India ranks third globally in LEED certifications.
New Delhi, Oct 27 (NationPress) India’s green building market is set to experience a remarkable growth trajectory, achieving an annual compound growth rate of 10.5% until FY 32, ultimately reaching a market size of $85 billion, according to a recent report.
The surge in certified spaces is fueled by rising demand from investors and tenants amidst increasing absorption rates and limited supply, as highlighted by Equirus Capital.
The analysis reveals that over the last 5.5 years, the certified supply in the market has outstripped non-certified supply by threefold, with absorption rates approximately 1.75 times higher, indicating a strong preference among occupiers.
From 2020 to the first half of 2025, leasing activity in certified spaces surpassed new certified supply by 6%, further intensifying competition for these eco-friendly spaces.
India continues to hold the third position globally in LEED certifications for green buildings.
According to Equirus Capital, certified buildings yield superior financial returns, reduced operational costs, and an enhanced brand value across various markets. Green-certified properties command a 7-14% premium in sale prices and rental rates, while also demonstrating 30-50% lower energy consumption and 20-30% less water usage.
The report highlights significant financial advantages stemming from certification, noting that IGBC Platinum-certified luxury residences in Bengaluru attained a 12% resale premium compared to conventional counterparts.
In a similar vein, a LEED Gold office complex in Gurugram reported a remarkable 18% increase in rental values and a 10% reduction in vacancy rates compared to similar properties.
Additionally, one of the largest LEED Platinum-certified campuses in Asia achieved annual operational cost savings of Rs 6 crore, thereby enhancing its long-term valuation in Mysuru.
The report also references international examples, noting that Green offices in the US attract 8-10% higher rents, while Singapore's BCA Green Mark-certified assets sell 15% faster.
Point of View
I believe that the growth of India's green building market reflects a broader commitment to sustainability and responsible investment. This trend not only enhances our real estate landscape but also positions India as a leader in global environmental initiatives. Our nation's shift towards certified green buildings reinforces the importance of sustainability in driving economic growth, and it is crucial for stakeholders to recognize and embrace this shift.
NationPress
28/10/2025
Frequently Asked Questions
What is the projected growth rate of India's green building market?
India's green building market is projected to grow at a compound annual growth rate of 10.5% until FY32.
What is the expected market size of the green building sector by FY32?
The green building market in India is expected to reach an opportunity size of $85 billion by FY32.
How does certified space differ from non-certified space?
Certified spaces in the green building market have shown a higher demand, with absorption rates approximately 1.75 times greater than non-certified spaces.
What financial benefits do green-certified buildings offer?
Green-certified buildings typically have a 7-14% higher sale price and rental premium, along with reduced operational costs.
How does India rank in global LEED certifications?
India holds the third position worldwide in LEED certifications for green buildings.
