India's green building market to reach $85 bn by FY32: Equirus Capital

Sustainable real estate gains momentum as certified green buildings attract higher demand, stronger returns, and premium valuations across major Indian cities

India’s green building market is expected to expand at a compound annual growth rate (CAGR) of 10.5 per cent through FY32, reaching an estimated $85 billion, driven by surging demand for certified spaces from investors and tenants amid tightening supply, according to data from Mumbai-based investment bank Equirus Capital.

 

Over the past five and a half years, the supply of certified green spaces entering the market was nearly three times that of non-certified properties. During the same period, absorption in certified buildings was about 1.75 times higher, underscoring occupiers’ growing preference for sustainable spaces. Between 2020 and the first half of 2025, leasing activity in certified buildings exceeded new supply by around 6 per cent, intensifying competition for green assets.

 

Equirus Capital highlighted several benefits of certified green buildings, noting that they deliver stronger financial returns, lower operating costs, and enhanced brand and occupier value across markets.

 

In Bengaluru, IGBC Platinum-certified luxury residences commanded a 12 per cent resale premium over comparable conventional projects. A LEED ((Leadership in Energy and Environmental Design) Gold-certified office complex in Gurugram recorded 18 per cent higher rental values and 10 per cent lower vacancy rates than peers. In Mysuru, one of Asia’s largest LEED Platinum-certified campuses cut operational costs by ~6 crore annually, boosting long-term asset valuation. Globally, green offices in the US command 8-10 per cent higher rents, according to the World Green Building Council (2023), while Singapore’s BCA Green Mark-certified properties trade 15 per cent faster.

 

Developers such as Brigade Group, DLF, and Ajmera Realty, among others, are placing greater emphasis on sustainable construction and green certifications. Brigade Gateway Residences, for instance, features a large rooftop solar plant and holds LEED certification. DLF’s The Crest in Gurugram, a LEED Platinum-certified project, incorporates energy-efficient systems and rainwater harvesting. In Mumbai, Ajmera Treon and Ajmera Aeon have both earned IGBC (Indian Green Building Council) certification, reflecting the growing commitment to environmentally responsible real estate.

 

On the global front, India has retained the third spot for LEED. At COP26 summit, Prime Minister Narendra Modi announced India’s goal to achieve net zero emissions by 2070. This long-term climate goal is underpinned by interim targets, including a 50 per cent reduction in carbon emissions and meeting half of the country’s energy demand through non-fossil fuel sources by 2030.