Japan Commercial HVAC Market Size (2024 - 2029)

Japan Commercial HVAC Market Analysis

The Japan Commercial HVAC Market size is estimated at USD 3.22 billion in 2024, and is expected to reach USD 4.56 billion by 2029, growing at a CAGR of 7.16% during the forecast period (2024-2029).

• HVAC systems are necessary for creating comfortable indoor environments in commercial buildings. In office spaces, they regulate temperatures, provide ventilation, and boost employee productivity and well-being. Furthermore, they assist in reducing health risks related to poor humidity control.
• Increasing levels of pollution in Japan have led the country to focus on eco-friendly buildings, presenting various investment prospects for industry players aiming to grow their footprint in the Japanese market.
• According to the International Energy Agency (IEA), Japan has updated its building standards, mandating that all new buildings achieve zero-energy performance by 2030 and existing structures meet this criterion by 2050. These standards, aimed at enhancing energy efficiency in buildings, are projected to stimulate market demand.
• Moreover, the increasing number of data centers, warehouses, shopping centers, educational institutions, and other facilities in developing nations is fueling the demand for commercial HVAC systems. The country is experiencing a surge in investments in the construction of data centers. For instance, in April 2024, ST Telemedia Global Data Centres (STT GDC) revealed plans to begin construction on its second data center facility in Tokyo, STT Tokyo 2, in response to the growing need for critical digital infrastructure in the country. The data center campus is expected to offer a maximum of 70 MW of IT capacity, and the STT Tokyo 2 project is expected to generate up to 38 MW upon completion.
• Energy-efficient HVAC systems are increasingly attractive in the country because of the escalating energy costs, providing potential savings. Nevertheless, the substantial upfront expenses linked to installation could hinder widespread acceptance and market expansion.
• The commercial HVAC market in Japan is fragmented, with a large number of players occupying a small market share. Key market players operating in the commercial HVAC market are focusing on new product development, strategic partnerships, acquisition, and expansion to meet the growing demand from customers, further supporting market growth.
• For instance, in August 2023, Daikin Industries, Ltd announced plans to acquire land in Tsukubamirai City, Ibaraki Prefecture, Japan, with the intention of establishing a new manufacturing plant dedicated to air conditioners. This calculated decision is set to bolster the company's domestic production capacity and further its objective of strengthening its position within the Japanese market.
• Furthermore, the rising expansion of public buildings in the country will support market growth. For instance, in June 2024, Citi revealed the introduction of Citi Commercial Bank (CCB) in Japan. This initiative is a crucial component of Citi's plan to establish CCB in strategic growth markets within targeted clusters to facilitate significant expansion.
• Additionally, the commercial HVAC industry in Japan is significantly influenced by macroeconomic elements like governmental regulations and fresh endeavors aimed at promoting the use of energy-efficient equipment. For instance, Japan has set a target to reduce its greenhouse gas (GHG) emissions by 46% by 2030, with a further ambition to achieve a 50% reduction.

Japan Commercial HVAC Industry Segmentation

Heating, ventilation, and air conditioning (HVAC) is a technology that ensures indoor and vehicular comfort by regulating thermal conditions and maintaining acceptable indoor air quality.

The study tracks the revenue accrued through the sale of commercial HVAC equipment and services by various players in the Japanese market. The study also tracks the key market parameters, underlying growth influencers, and major vendors operating in the industry, which supports the market estimations and growth rates during the forecast period. The study further analyses the overall impact of COVID-19 and other macroeconomic factors on the market. The report’s scope encompasses market sizing and forecasts for the various market segments.

The Japanese commercial HVAC market is segmented by type of component (HVAC equipment [heating equipment, air conditioning/ventilation equipment, and HVAC services) and end-user industry (hospitality, commercial building, public building, and other end-user industries). The market sizes and forecasts are provided in terms of value (USD) for all the above segments.