Sustainability assessment is a multi-faceted, dynamic, and complex paradigm in the context of buildings with several social, economic and environmental interactions. Hence, the building sector lacks a robust sustainability evaluation and benchmarking mechanism. Consequently, a system thinking approach can solve these challenges due to its ability to evaluate complex systems. Therefore, this paper presents a methodological framework for sustainability benchmarking of buildings using the system dynamics modeling and simulation technique. The proposed methodology captures the dynamic trade-offs between the sustainability dimensions associated with a building while evaluating various policy scenarios for improvement. Further, through a series of system simulations, a benchmarking scale is developed to indicate the sustainability of the building as high, medium, and low levels based on the defined criteria. Results indicate the sustainability behavior of different buildings in comparison to achievable industry benchmarks for the building type evaluated while recommending measures for improvement to achieve better sustainability.