
Study Period | 2020 - 2030 |
Base Year For Estimation | 2024 |
Forecast Data Period | 2025 - 2030 |
Market Size (2025) | USD 629.38 Billion |
Market Size (2030) | USD 740.31 Billion |
CAGR (2025 - 2030) | 3.30 % |
Market Concentration | Medium |
Major Players![]() *Disclaimer: Major Players sorted in no particular order |
Japan Construction Market Analysis
The Japan Construction Market size is estimated at USD 629.38 billion in 2025, and is expected to reach USD 740.31 billion by 2030, at a CAGR of 3.3% during the forecast period (2025-2030).
- The construction industry plays a crucial role in Japan's economy, significantly impacting both GDP and employment. In the last ten years, the sector has seen consistent growth, fueled by reconstruction efforts post the Great East Japan Earthquake, infrastructure projects tied to the Tokyo Olympics, and urban redevelopment initiatives. The market is set for further growth, bolstered by government investments in disaster resilience and sustainable infrastructure, alongside major undertakings like the Chuo Shinkansen (maglev bullet train) and the Osaka World Expo 2025.
- A notable trend in the sector is the heightened focus on sustainability and eco-friendly construction methods. The Japanese government is championing green building standards and energy-efficient designs, especially in commercial and institutional projects. Furthermore, Japan is prioritizing the creation of smart cities, utilizing public-private partnerships (PPP) to develop sustainable and tech-forward urban areas. There's also a significant push towards renewable energy infrastructure, aligning with Japan's carbon-neutral ambitions and plans to boost offshore wind capacity by 2030.
- However, the construction industry grapples with challenges, notably labor shortages stemming from an aging population and a dwindling workforce. This challenge is intensified by younger workers leaving the industry, leading to heightened competition for skilled labor. In response, construction firms are turning to digital solutions like Building Information Modelling (BIM), automation, and data analytics to boost productivity. The sector is also adapting to new regulations and decarbonization initiatives, prompting shifts in business operations.
- On the financial front, the Japanese construction market remains robust, with total investments hitting an estimated 68.8 trillion yen (USD 521.63 billion) in FY 2022, and a rise to 70.3 trillion yen (USD 533.01 billion) projected for FY 2023. Even with hurdles like escalating material costs and persistent labor shortages, the market anticipates a 1.7% growth in 2024, buoyed by heightened private investments in building projects and government spending for the 2025 Osaka World Expo. From 2025 to 2028, the market is forecasted to expand at an average annual rate of 1.1%, driven by ongoing investments in renewable energy, manufacturing, and commercial construction.
Japan Construction Market Trends
Government Initiatives Boosting Japan's Construction Market
Japan's construction market is significantly influenced by various government initiatives centered on infrastructure development, disaster resilience, sustainability, and urban modernization. A major focus of these initiatives is disaster prevention and national resilience. Over the next five years, the government has earmarked around JPY 15 trillion (USD 0.12 trillion) for earthquake mitigation and infrastructure upgrades, especially in disaster-prone regions. This move not only aims to strengthen the nation's defenses against earthquakes and other environmental threats but also boosts demand for construction services, particularly in seismic-resistant designs and infrastructure enhancements. Furthermore, in response to an aging population and labor shortages in the construction industry, the government is promoting advanced technologies like artificial intelligence (AI), machine learning, and Building Information Modeling (BIM) to enhance productivity and lessen dependence on manual labor.
Renewable energy and sustainability are also high on the government's agenda, with ambitions to boost offshore wind capacity and meet carbon-neutral targets. This green construction initiative is prominently seen in institutional and commercial projects, where eco-friendly designs and energy-efficient systems are becoming the norm. The government is championing green building standards across the construction landscape, especially in the evolution of smart cities that meld sustainable urban planning with advanced technology. These smart cities are driving investments in communication infrastructure, safety, and public transport, with an increasing reliance on public-private partnerships (PPP) for funding.
Beyond these overarching initiatives, the government is also rolling out programs to bolster the residential construction sector. To promote homeownership, the government offers mortgage assistance and incentives for families with children. In 2021 and 2022, additional funds were allocated for subsidies, particularly targeting families buying newly constructed homes in suburban areas, anticipating a surge in demand for single-family homes. These initiatives aim to make housing more accessible, countering the trend of rising property prices and invigorating the residential construction market.

Expansion in Commercial Construction
In the Japanese construction market, the commercial construction sector, especially office spaces and logistics facilities, stands out as a key segment. Post-pandemic, there's been a surge in demand for data centers, logistics infrastructure, and contemporary office buildings. This uptick is further bolstered by the Japanese government's efforts to rejuvenate tourism and a notable increase in foreign investments in commercial real estate.
Moreover, Japan's dedication to sustainability is urging developers to adopt green building technologies and energy-efficient systems in commercial projects, a move anticipated to further bolster growth in this sector.
Industrial construction, particularly in renewable energy projects and the manufacturing domain, is another significant growth aspect. Japan's ambition to lessen its dependence on foreign energy has paved the way for expanding solar and wind energy capacities, presenting vast construction opportunities, especially in renewable energy infrastructure. The government's endeavors to diversify energy sources and achieve energy independence are catalyzing substantial investments, marking a promising horizon for industrial construction.

Japan Construction Industry Overview
The market is fragmented and expected to grow during the forecast period due to the increase in government initiatives and commercial construction in the country. The market provides chances for small and medium-sized businesses due to the rising government spending in the industry. During the forecast period, the Japanese construction market has the potential for expansion, which may increase market competitiveness.
The key players in the Japanese construction market are Obayashi Corp., Mitsubishi Heavy Industries Ltd, Nippon Concrete Industries, Takada Corporation, The Zenitaka Corp., Sumitomo Mitsui Construction Co. Ltd, and Toshiba Corp.
Japan Construction Market Leaders
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Obayashi Corp.
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Mitsubishi Heavy Industries Ltd
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Nippon Concrete Industries
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Takada Corporation,
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The Zenitaka Corp.
- *Disclaimer: Major Players sorted in no particular order

Japan Construction Market News
- October 2024: Obayashi Corporation has introduced a significant architectural endeavor in 3D printing with the launch of 3dpod, marking Japan's inaugural 3D-printed building to achieve earthquake-proof status, ministerial certification, and a building permit. Led by Co Capitanio and Akito Masumura, this cutting-edge construction technique minimizes labor requirements, shortens construction timelines, and optimizes material usage, effectively tackling the issue of skilled labor shortages in remote regions. The 3dpod was crafted to adhere to Japan's stringent seismic building regulations, eschewing traditional reinforcement methods and utilizing 3D printing for all above-ground structural components. The pod features compact, multi-layered walls that integrate load-bearing structures with insulation, equipment routing, and systems for radiant heating and cooling, ensuring it matches the habitability of conventional buildings. Having garnered the esteemed 2024 International Architecture Award, this trailblazing project also functions as a public demonstration facility, assessing the durability, structural soundness, and environmental efficiency of 3D printing technology. This venture highlights the transformative potential of 3D printing in construction, especially in regions prone to earthquakes, in light of Japan's historically stringent building standards.
- October 2024: Mitsubishi Power, a subsidiary of Mitsubishi Heavy Industries (MHI), has successfully completed a 50-megawatt (MW) woody biomass-fired power plant located in Hyuga, Miyazaki Prefecture. Developed by a consortium spearheaded by MHI, the plant was delivered on schedule as part of a comprehensive turnkey solution encompassing engineering, procurement, and construction (EPC). Operated by Hyuga Biomass Power Co., Ltd., the Hyuga Biomass Power Plant is equipped with state-of-the-art technology, including a steam turbine, circulating fluidized bed (CFB) boiler, and generator, all aimed at enhancing biomass power generation efficiency while minimizing environmental impact. The plant's special purpose company (SPC) is a joint venture among Osaka Gas, ITOCHU Corporation, Tokyo Century Corporation, and Tokyo Energy & Systems Inc. MHI provided the primary power generation equipment, while its affiliate, Mitsubishi Heavy Industries Power Environmental Solutions, contributed air quality control systems. Looking ahead, MHI Group is committed to advancing renewable energy solutions, including biomass power, to mitigate environmental impacts and support the global energy transition.
- May 2024: Toshiba Electronic Devices & Storage Corporation celebrated the inauguration of its new 300-millimeter wafer fabrication facility for power semiconductors in Kawasaki, Japan. The facility, located at Kaga Toshiba Electronics Corporation in Ishikawa Prefecture, also includes a newly constructed office building. This development is a key achievement in Phase 1 of Toshiba's extensive multi-year investment initiative. With the installation of equipment currently in progress, Toshiba is gearing up to kick off mass production in the latter half of fiscal year 2024. Once the facility is fully operational, it will bolster Toshiba's production capacity for power semiconductors, such as MOSFETs and IGBTs, to 2.5 times its capacity in fiscal 2021. Built with a seismic isolation structure for enhanced earthquake resilience, the facility operates entirely on renewable energy sources, including solar panels, aligning with Toshiba’s Business Continuity Plan (BCP). Furthermore, the integration of artificial intelligence (AI) aims to elevate both product quality and production efficiency. Toshiba is also looking forward to securing a grant from Japan’s Ministry of Economy, Trade, and Industry, which would partially subsidize its investment in manufacturing equipment. With the rising demand for power semiconductors driven by the electrification of vehicles and the automation of industrial machinery, Toshiba's bolstered semiconductor production capabilities play a pivotal role in the global push towards carbon neutrality.
Japan Construction Industry Segmentation
Construction refers to building commercial, institutional, or residential infrastructures like bridges, buildings, roads, and other structures. The different materials used in modern-day construction include clay, stone, timber, brick, concrete, metals, and plastics, among others.
Japan's construction market is segmented by sector (residential, commercial, industrial, infrastructure (transportation), and energy and utilities).
The report offers the market sizes and forecasts in value (USD) for all the above segments. The report also covers the impact of COVID-19 on the market.
By Sector | Residential |
Commercial | |
Industrial | |
Infrastruture (Transportation) | |
Energy and Utilities |
Japan Construction Market Research Faqs
How big is the Japan Construction Market?
The Japan Construction Market size is expected to reach USD 629.38 billion in 2025 and grow at a CAGR of 3.30% to reach USD 740.31 billion by 2030.
What is the current Japan Construction Market size?
In 2025, the Japan Construction Market size is expected to reach USD 629.38 billion.
Who are the key players in Japan Construction Market?
Obayashi Corp., Mitsubishi Heavy Industries Ltd, Nippon Concrete Industries, Takada Corporation, and The Zenitaka Corp. are the major companies operating in the Japan Construction Market.
What years does this Japan Construction Market cover, and what was the market size in 2024?
In 2024, the Japan Construction Market size was estimated at USD 608.61 billion. The report covers the Japan Construction Market historical market size for years: 2020, 2021, 2022, 2023 and 2024. The report also forecasts the Japan Construction Market size for years: 2025, 2026, 2027, 2028, 2029 and 2030.
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Japan Construction Industry Report
Statistics for the 2025 Japan Construction market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Japan Construction analysis includes a market forecast outlook for 2025 to 2030 and historical overview. Get a sample of this industry analysis as a free report PDF download.