Report

Turkey Construction Market Analysis

The Turkey construction market was valued at USD 173.56 billion in 2025 and estimated to grow from USD 183.02 billion in 2026 to reach USD 238.63 billion by 2031, at a CAGR of 5.45% during the forecast period (2026-2031). Multiple tailwinds interact to sustain this trajectory: a USD 46.2 billion public-investment program, record-scale post-earthquake reconstruction, and a widening pipeline of public-private partnerships that already total 270 completed projects worth USD 204 billion. Sector leaders also capitalize on Turkey's Belt and Road positioning, giving the Turkey construction market unique access to trans-Eurasian trade flows and concessional finance. New seismic codes introduced in 2025 add compliance costs yet simultaneously spur demand for retrofit engineering, while green-cement mandates and ESG-linked loans accelerate uptake of low-carbon building solutions. Further momentum comes from industrial free-zone expansion that compresses permitting time by up to 40%, and a digital-construction push that channels prefabrication to offset skilled-labor shortages.

Turkey Construction Market Trends and Insights



Growing Industrial Free-Zone Expansion

Industrial free-zones intensify Turkey's manufacturing appeal by bundling tax incentives, streamlined permits, and logistics connectivity, all of which expand the Turkey construction market. The Ceyhan Energy Specialized Industrial Zone anchors hydrocarbons processing and trims the nation's USD 60 billion intermediate-goods import bill. Accelerated approvals that cut development cycles by up to 40% stimulate a continuous flow of factory, warehouse, and utility projects. Foreign investors co-locate suppliers inside zones, magnifying spillover construction demand along the value chain. These clusters dovetail with the 2024-2028 International Direct Investment Strategy, which prioritizes green transformation and supply-chain diversification, ensuring sustained project inflows over the medium term.

Surge in Green-Certified Projects & ESG Financing

Turkey's 2053 net-zero pledge pushes developers to seek ESG-linked loans that lower borrowing costs in exchange for certified energy performance. The World Bank's USD 3.2 billion climate framework funds decarbonization measures, while a new Building Sector Decarbonization Roadmap sets zero-carbon standards for all public projects. Cement and steel suppliers confront the EU Carbon Border Adjustment Mechanism, giving rise to green-hydrogen installations targeting 2 GW electrolyzer capacity by 2030. Concurrently, public tenders now require reduced-clinker cement beginning January 2025, channeling R&D toward alternative binders. These converging forces embed sustainability as a core selection criterion across the Turkey construction market.

Volatile Lira Driving Material-Import Inflation

Turkey sources nearly 40% of its construction inputs abroad, making projects sensitive to currency swings. Lira depreciation amplifies steel, aluminum, and mechanical-equipment costs, compressing margins on fixed-price contracts. Hedging and escalation clauses offer partial relief yet can erode competitiveness in public tenders. Elevated inflation forecast at 43% for 2024 adds further strain by lifting domestic logistics and labor expenses. Some contractors localize supply or invest in domestic plants, but these capital-intensive moves dilute balance-sheet flexibility in the near term.

Other drivers and restraints analyzed in the detailed report include:

Rising Urban-Renewal & Earthquake-Resilient DemandGovernment Mega-Infrastructure Spending PipelineTight Monetary Policy Dampening Housing Demand

For complete list of drivers and restraints, kindly check the Table Of Contents.

Segment Analysis

Infrastructure construction accounted for 31.05% of Turkey construction market size in 2025, whereas residential commanded a larger 61.10% share. Yet infrastructure is projected to be the fastest-growing with a 6.92% CAGR through 2031, powered by highway extensions, high-speed rail lines, and energy corridors. Government outlays of USD 16.3 billion for transport alone in the 2025 investment program validate sustained work pipelines. Contractors active in road, rail, and bridge packages gain from multi-year contracts that shield workflows against cyclical housing soft patches.

Rapid scale-up of energy infrastructure adds further depth. The Akkuyu nuclear project's four 1,200 MW reactors, slated for phased commissioning in 2025, anchor a multi-billion-dollar construction scope. Renewable expansion complements baseload capacity, with utility-scale solar parks and wind clusters embedding smart-grid interfaces. Logistics construction inside industrial free-zones rounds out the opportunity set, while commercial offices in Istanbul gradually pivot toward green-certified retrofits anchored by LEED and BREEAM protocols. Together, these sub-sectors inject diversified volume, reinforcing the upward trajectory of the Turkey construction market.

New-build projects held 76.35% of Turkey construction market share in 2025, but renovation is forecast to post a 5.96% CAGR to 2031, mirroring mandated seismic upgrades. The Turkish Building Earthquake Code of 2018 and the 2025 enforcement directive make retrofit compliance obligatory for structures erected before 2000. Istanbul's 'Yar?s? Bizden' program alone has catalyzed 106,000 funding applications that translate into USD 69 million in committed works. Shorter permitting cycles for retrofit approvals are now down to six months, accelerating cash conversion for contractors specializing in structural reinforcement.

Retrofit complexity, encompassing base isolation, carbon-fiber wrapping, and HVAC re-specification, commands higher margins than standard shell-and-core construction. World Bank-co-financed energy-efficiency upgrades piggyback on seismic scopes, bundling insulation, glazing, and rooftop solar into single contracts. Although material input inflation challenges cost control, renovation timescales are typically shorter than ground-up builds, limiting exposure to exchange-rate volatility. As a result, renovation forms a counter-cyclical buffer, stabilizing the Turkey construction market during housing-credit slowdowns.

The Turkey Construction Market Report is Segmented by Sector (Residential, Commercial and Infrastructure), by Construction Type (New Construction and Renovation), by Construction Method (Conventional On-Site, and More), by Investment Source (Public and Private), and by Region (Istanbul, Ankara, Izmir and the Rest of Turkey). The Market Forecasts are Provided in Terms of Value (USD).

List of Companies Covered in this Report:

Ronesans Holding (Renaissance Construction) Limak ?nsaat ENKA ?nsaat ve Sanayi A.S. TAV Construction Alarko Contracting Group Polimeks ?nsaat Cengiz ?nsaat Sanayi ve Ticaret A.S. Yap? Merkezi ?nsaat Kolin ?nsaat Nurol Construction & Trading Co. Mapa ?nsaat Tekfen ?nsaat Kalyon ?nsaat ?CTAS ?nsaat Ant Yap? Gap ?nsaat STFA Construction Group Onur Taahhut Gama ?nsaat Ronesans Endustri Tesisleri

Additional Benefits:

The market estimate (ME) sheet in Excel format
3 months of analyst support