They're both grammatically correct because there's no grammatical problem with either.
It's a subtle distinction. The difference is about what time the words refer to.
"...will have increased" refers to the indicated point in time.
"... will increase" refers to the future in general, so in this case, the period leading up to the indicated point.
I expect in this case the writer means to make a point about the indicated point in time, so "will have increased" would help focus that a bit.
On the other hand, if the writer (say, outside this sentence) is instead focusing on describing other things about the increase in books, and the renovation's completion is just an incidental point of reference, the writer might prefer "will increase".