NEW YORK, July 1, 2025 /PRNewswire/ -- According to a new comprehensive report from The Insight Partners, the global smart infrastructure market is observing significant growth owing to urbanization and smart cities development, and government policies and incentives.
The smart infrastructure market was valued at USD 845.3 billion in 2024 and is projected to reach US$ 2,745.9 billion by 2031; it is expected to register a CAGR of 18.3% during 2025-2031.
The report runs an in-depth analysis of market trends, key players, and future opportunities. In general, the smart infrastructure market comprises a vast array of offerings, focus areas, end user, and geography, which are expected to register strength during the coming years.
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Overview of Report Findings
- Market Dynamics and Insights: As global urbanization continues to accelerate, it is reshaping the demand landscape for infrastructure development and modernization. According to projections by the United Nations, nearly 68% of the world's population is expected to reside in urban areas by 2050, underscoring a significant demographic shift that places mounting pressure on existing urban systems and resources. A compelling example of this trend is China, where the urbanization rate has soared from just 11% in 1949 to an estimated 66% by 2023.
This transformation reflects both rapid industrialization and large-scale rural-to-urban migration. This surge in urban concentration is driving the urgent need for smarter, more efficient, and sustainable infrastructure solutions that can support dense populations, improve quality of life, and ensure resilience against environmental and operational challenges. Consequently, the smart infrastructure market is experiencing robust growth, fueled by rising investments in intelligent transportation systems, smart grids, automated water and waste management, and advanced urban planning technologies. These solutions, powered by IoT, AI, and big data analytics, are enabling cities to become more adaptive, connected, and resource-efficient, forming the backbone of the next generation of urban development. - Regional Insights: The Europe smart infrastructure market experienced significant momentum, driven by substantial public investment and a robust regulatory framework aimed at advancing sustainable and technologically integrated transport systems. A key development was the European Commission's selection of 134 transport projects to receive over €7 billion (US$ 7.6 billion) in EU grants through the Connecting Europe Facility (CEF), the EU's primary instrument for strategic infrastructure funding. This represented the largest funding allocation under the then-current CEF Transport programme, underscoring the EU's strong commitment to modernizing and decarbonizing its transport infrastructure.
Approximately 83% of the funding supported projects aligned with the EU's climate objectives, particularly those enhancing the sustainability and efficiency of the trans-European transport (TEN-T) network, including railways, inland waterways, and maritime corridors. Rail projects alone received nearly 80% of the €7 billion (US$ 7.6 billion), highlighting a strategic emphasis on low-emission, high-capacity modes of transport. These investments were further reinforced by the implementation of the revised TEN-T Regulation, which took effect on July 18, 2024. The updated regulation introduced stricter standards and timelines for infrastructure interoperability, digital integration, and automation across member states. Together, these actions fueled the growth of the smart infrastructure market in Europe, opening up new opportunities for technology providers, engineering firms, and urban mobility innovators engaged in developing next-generation infrastructure solutions. - Geographical Insights: North America is expected to dominate the smart infrastructure market with the highest market share in 2024.
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Market Segmentation
- In terms of offering, the smart infrastructure market is segmented into hardware, software, and services.
- Based on the focus area, the market is divided into smart transportation, smart buildings, smart utilities, smart healthcare, smart hospitality, smart agriculture, smart manufacturing, and others.
- In terms of end user, the smart infrastructure market is segmented into commercial, residential, and industrial.
- The smart infrastructure market is segmented into five major regions: North America, Europe, Asia Pacific, the Middle East and Africa, and South and Central America.
Competitive Strategy and Development
- Key Players: A few major companies operating in the smart infrastructure market include Schneider Electric, Siemens AG, Cisco Systems, Inc., Honeywell International Inc., Hitachi Ltd., IBM Corporation, ABB Group, Johnson Controls, Microsoft, and Huawei Technologies, among others.
- Trending Topics: Digital Twins for Infrastructure, AI and Machine Learning Integration, Infrastructure Resilience and Climate Adaptation, 5G and Edge Computing in Infrastructure, among others.
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Global Headlines on the Smart Infrastructure Market
- "Johnson Controls, the global leader for smart, healthy, safe, and sustainable buildings, released a new commissioned study conducted by Forrester Consulting quantifying the Total Economic Impact and benefits of its OpenBlue platform. In the study, Forrester found that a model organization representing a composite of interviewed customers from multiple industries deploying OpenBlue, including FM: Systems solutions, could achieve up to a 155% return on investment (ROI) over three years."
- "At RealComm, a major gathering of real estate technology leaders in Tampa, the Administrator of the U.S. General Services Administration (GSA) announced plans to invest $80 million from the Inflation Reduction Act (IRA), the largest climate investment in U.S. history, into smart building technologies that will help reduce emissions, increase efficiency and reduce costs, and enhance comfort across an estimated 560 federal buildings. The investments, impacting 49 states, the Commonwealth of Puerto Rico, U.S. Virgin Islands, and Washington, DC, will also help create jobs and accelerate progress toward achieving net-zero emissions in the federal building portfolio by 2045."
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Conclusion
Smart infrastructure refers to the integration of digital technologies-such as IoT, AI, sensors, and data analytics-into traditional infrastructure systems to enhance their efficiency, sustainability, connectivity, and resilience. This includes smart grids, intelligent transportation systems, automated water and waste management, and connected buildings. The growth of the smart infrastructure market is driven by rapid urbanization, rising demand for sustainable and energy-efficient solutions, government investments in smart city projects, advances in digital and communication technologies, and the urgent need to modernize aging infrastructure to withstand climate and operational challenges.
The report from The Insight Partners, therefore, provides several stakeholders-including technology and hardware providers, software & service providers, government & regulatory bodies, and end users-with valuable insights into how to successfully navigate this evolving market landscape and unlock new opportunities.
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