Benchmark International

The architectural services industry comprises various companies that design and plan buildings and structures spanning residential, institutional, leisure, commercial, and industrial spaces. Key areas of expertise include knowledge of design, construction, zoning, building codes, and building materials.

The global architectural services market surged to $359.98 billion in 2022. It forecasts a compound annual growth rate (CAGR) of 4.8% through 2030. Much of this growth can be attributed to the high demand for services due to increasing construction activities worldwide due to rapid urbanization in developing countries and government focus on affordable housing. This demand for construction services expects to drive the demand for architectural services, boosting the market's growth.

Another factor driving the market is the increasing demand for green buildings. Sustainable construction offers various benefits and business opportunities. The market benefits from a greater need for basic bioclimatic design and conceptual engineering construction.

Technology’s role in architecture is driving the market and helping to reduce costs and turnaround times in terms of hours and days. Increasing use of 3D printing in architecture is a growing market factor, as it delivers the most direct way to translate on-screen visuals into tangible touch-and-feel representation. It also allows for projects to be designed in shorter periods. In addition, the technology is used to create 3D-printed living accommodations, with 3D printing seen as the future of homebuilding. The first 3D-printed office in the world was created in Dubai, United Arab Emirates. Known as the Office of the Future, it was built in 2016 using 3D-printed concrete elements. It is approximately 2,000 square feet and was printed using a 20-foot-tall 3D printer in China. 

Artificial Intelligence (AI), Virtual Reality (VR), and Augmented Reality (AR) are technologies that are also playing a significant role in the design of buildings, helping architects to showcase complex designs to clients with high precision while also saving time and money. As a result, these technologies are helping to drive market growth. 

More homes are built with automation, so creating smart homes designed with automation is a top priority. Automated systems help maintain security, temperature control, and lighting, which reduces energy costs and impacts the environment. 

Architectural services such as schematic designs, space planning, and interior design enable firms to attract more clients and improve client experiences. Additionally, market growth will benefit as more major industry players focus on enhancing their businesses and customer bases through strategic partnerships.

By Service Type 

The architectural services market is segmented into:

• Architectural advisory services
• Construction and project management
• Engineering
• Interior design
• Urban planning 
• Space planning
• Schematic design

Architectural firms are using these services to improve consumer attraction and customer experiences.

The construction and project management segment held the highest market share of 35.4% in 2022 and forecasts to grow at a CAGR of 7.64% through 2030. As construction activity increases, these services are in higher demand (project lifecycle management, cost control, scheduling, and risk management).

Urban planning forecasts significant market growth through 2030, registering a CAGR of 6.4%. This is primarily due to more government initiatives regarding urban development. Also, the increasing number of residential projects, and the growing demand for intelligent solutions to manage and deliver efficient plans, are expected to drive growth in this segment.

The demand for architectural advisory and interior design services is expected to increase alongside growing environmental concerns and company initiatives to create green buildings.

By End-User

The architectural services market is segmented by end-user into:

• Industrial
• Residential
• Healthcare
• Hospitality 
• Education
• Government
• Retail
• Other

In 2022, the industrial segment accounted for the largest revenue share of more than 45%. It forecasts to grow at a CAGR of 7.2% through 2030 due to rapid industrialization, increased company acquisitions, and the construction of new factories. 

The residential segment is the second-highest-growing segment, with a share of 25.1% in 2021. The growth of urban populations is pushing the real estate sector to find sustainable solutions for residential structures resulting from factors such as higher employment rates and increases in disposable income. Additionally, architects are expected to need more services, such as urban planning and project management, to manage intelligent city projects better.

Architectural services are also widely used in healthcare to upgrade existing medical spaces to offer better healthcare facilities, more seamless treatment of patients, improved patient outcomes, and increased patient satisfaction. As a result, services such as construction, project management, and interior design expects to be in high demand.

The hospitality sector also multiplies as tourism increases in developed and developing countries. This leads to the building of new hotels, resorts, and restaurants in popular tourist locations.

By Region

The Asia-Pacific region dominated the market and accounted for the largest revenue share of more than 36% in 2022. The area expects to grow steadily in the coming years due to rapid urbanization, growing populations, government focus on smart cities, and increasing residential and industrial construction projects. China dominated the market with the presence of major manufacturers and their growing efforts to create new production plants. It also expects to be the fastest-growing market for 3D printing in construction. 

Europe also accounted for a significant market revenue share thanks to the growing construction sector in IT alongside rising investments and new infrastructure development projects. Furthermore, a bounce-back in construction services following the suspension of activities due to the COVID-19 pandemic expects to further drive the architectural service market over the forecast period in the region.

The United Kingdom already boasts a rich architectural history balanced with newer contemporary designs. Over the next decade, the population of London expects to increase by 1 million people, and it anticipates that approximately 40,320 new homes will be required each of those ten years, driving significant growth in the architectural services market.

In the United States, architectural movements are rising due to high levels of development activity and unique market demand driving the multifamily property market. 

M&A

The architectural services market needs to be more cohesive, with competing entities focusing on innovative design strategies and customized services. Mergers and acquisitions are being utilized to diversify product portfolios and help to gain market share. New entrants backed by venture capital (VC) firms are also entering the architectural services market, offering more innovative designs and advanced solutions. This is also leading to increased competition in the market. Major industry players focus on acquiring significant market shares through strategic acquisitions that improve logistics, supply chains, and real estate prospects. 

Americas: Sam Smoot at +1 (813) 898 2350 / Smoot@BenchmarkIntl.com

Europe: Michael Lawrie at +44 (0) 161 359 4400 / Lawrie@BenchmarkIntl.com

Africa: Anthony McCardle at +27 21 300 2055 / McCardle@BenchmarkIntl.com 

ABOUT BENCHMARK INTERNATIONAL:

Benchmark International is a global M&A firm that provides business owners with creative, value-maximizing solutions for growing and exiting their businesses. Benchmark International has handled over $10 billion in transaction value across various industries from offices across the world. With decades of M&A experience, Benchmark International’s transaction teams have assisted business owners with achieving their objectives and ensuring the continued growth of their businesses. The firm has also been named the Investment Banking Firm of the Year by The M&A Advisor and the Global M&A Network as well as the #1 Sell-side Exclusive M&A Advisor in the World by Pitchbook’s Global League Tables.

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