Europe Construction Market Share, Size, Analysis, Trends: By End Use: Residential, Healthcare, Hospitality, Others; By Residential Buildings and Single Units: Apartments/Flats, Detached Houses, Semi-Detached, Terraced Houses, Others; Regional Analysis; Competitive Landscape; Key Trends and Developments in the Market; 2024-2032

Europe Construction Market Outlook

The Europe construction market size attained a value of approximately USD 2,752.75 billion in 2023. The market is projected to grow at a CAGR of 4.9% in the forecast period of 2024-2032, reaching a value of around USD 4,233.96 billion by 2032.

Key Takeaways

Construction refers to the process of assembling buildings, infrastructures, and other structures, which can be public or private. The process of construction encompasses a series of technicalities, including planning, design, financing, and project execution. Some types of construction include residential building and renovation, commercial and industrial construction, as well as infrastructure construction.

Rising concerns about climate change and the environmental impact of construction activities are transforming the Europe construction market landscape. According to the European Environment Agency, the building sector is one of the key contributors to energy-related emissions in Europe, representing a total of 35% in 2021.

Due to this, various European construction companies are switching to sustainable and bio-based building materials to improve the energy efficiency of construction operations. Sustainable building materials are commonly derived from renewable resources, and meticulously crafted to minimise environmental impact across their life cycle. Such materials encompass recycled content, responsibly sourced wood, and alternative substances that require fewer resources and energy during the production process.

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Key Trends and Developments

Rising emphasis on sustainable construction, advancements in technologies for construction activities, and the rising government investments are propelling Europe construction market development

Europe Construction Market Trends

The increasing investments in infrastructure development by governments and the European Union are likely to be a major factor influencing the Europe construction market growth. Countries in the region regularly establish comprehensive policy frameworks to guide infrastructural development. These frameworks are often established individually or collectively through the European Union.

According to European construction industry statistics, in 2023, the European Commission announced its plan to invest EUR 6.2 billion in 107 selected transport infrastructure projects in EU grants from the Connecting Europe Facility, which can increase the Europe construction market value. More than 80% of the total funds allotted will be direct towards projects that are aimed at improving the sustainability and efficiency of key transportation networks, such as the railroads, inland waterways, and marine routes of the trans-European transport network (TEN-T).

Challenges in the European Construction Market

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Market Segmentation

Europe Construction Market Report and Forecast 2024-2032 offers a detailed analysis of the market based on the following segments:

Based on residential end use, the market is sub-segmented into private housing and other buildings and single units.

Residential sector helps in expansion of the market due to the rising demand for multi-family housing

According to the Europe construction market analysis, the residential sector is expected to develop substantially during the forecast period. There is an increasing demand for the development of multi-family housing construction due to rising urbanisation and the growing population of countries in Europe.

For instance, the Sackville Road Residential Community project encompasses the construction of six blocks of varying heights, ranging from 2 to 15 stories. These blocks are strategically designed to create a cohesive and integrated residential space that caters to diverse housing needs. The project, valued at USD 332 million, represents a significant investment in the construction of a residential community in Hove, the United Kingdom.

Meanwhile, as per the Europe construction market report, the healthcare sector, driven by factors such as government healthcare spending, demographic changes (like an ageing population), and the need for modern medical facilities, witnessed a noticeable increase on expanding and modernising healthcare infrastructure, especially after the COVID-19 pandemic. Moreover, the hospitality sector, encompassing hotels, resorts, and other leisure facilities, typically follows trends in tourism and business travel.

The table below shows key data and statistics for three sectors in the Europe construction market.

The development of apartments, flats, and detached houses aids the market growth

Construction of apartments/flats and detached houses play a crucial role in propelling the demand for construction in the European market. The construction of these different types of housing responds to the varied needs and preferences of residents, contributes to urban and suburban development, and stimulates economic activity in the construction sector. Moreover, the increasing focus on the renovation and reconstruction of buildings, as well as the integration of various technologies in construction activities has led to the segment’s growth.

According to Europe construction market estimates, in North Macedonia, 71.2% of the population lives in a detached house, whereas flats are more common in the Baltics and southern and central Europe, with Spain having the highest proportion of people living in flats at 65.7%. The United Kingdom, Ireland, the Netherlands, and Belgium are the only European countries where the most people live in an apartment or terraced house.

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Competitive Landscape

Construction companies in Europe are adopting sustainable construction methods to demonstrate their commitment to high environmental standards

Other key players in the Europe construction market include Hochtief AG, Eiffage S.A., STRABAG International GmbH, Balfour Beatty plc, Ferrovial S.A., and Acciona, S.A, among others.

Europe Construction Market Analysis by Region

Germany holds a substantial market share as the country has passed many housing policies to facilitate development of residential sector

Sustainable construction methods have gained substantial traction in the European construction industry, reflecting a commitment to environmental responsibility, resource efficiency, and the long-term well-being of communities. Green building certification systems such as Leadership in Energy and Environmental Design (LEED), Building Research Establishment Environmental Assessment Method (BREEAM), and the German Sustainable Building Council (DGNB) provide benchmarks for sustainable construction.

In terms of residential infrastructure development, Germany construction market holds a significant portion of the European construction market. Germany has enacted housing policies designed to foster and facilitate residential development. These initiatives include providing subsidies for energy-efficient construction, offering incentives for urban development, and establishing regulatory frameworks that champion sustainable housing practices.

On the other hand, United Kingdom and France have been increasingly focusing on civil infrastructure development. Some of the major ongoing projects include Hinkley Point C, the restoration of the Palace of Westminister, Grand Paris Express, and the Nantes New CHU Hospital Development, which can accelerate the Europe construction market growth.

Key Highlights of the Report

*At Expert Market Research, we strive to always give you current and accurate information. The numbers depicted in the description are indicative and may differ from the actual numbers in the final EMR report.