Modular & Prefabricated Construction Market Size By Type (Permanent, Relocatable), By Material (Steel, Wood, Concrete), By Application (Single Family Residential, Multi-Family Residential, Office, Hospitality, Retail, Healthcare), Industry Analysis Report, Regional Outlook, Growth Potential, Price Trend, Competitive Market Share & Forecast, 2020 – 2026

Industry Trends

Modular & Prefabricated Construction Market size was over USD 129 billion in 2019 and will grow at a CAGR of 7.1% from 2020 to 2026. The modular construction market is expected to witness significant growth in the forecast period owing to increasing industrialization, urbanization, and rapid population growth in developing economies. The modular process of building revolutionizes the entire construction industry. They are more efficient and can be completed 30-50% faster than traditional construction methods.
 

Additionally, prefabricated construction will have ample opportunities to grow due to rising consumer preferences for green buildings and sustainable construction process.
 

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Construction is one of the most dynamic sectors crucial for long-term development. As per Oxford Economics, global construction is anticipated to grow to USD 15.5 trillion by 2030, mainly driven by India, the U.S., and China. Strong development of residential & commercial structures in developed countries due to the rising demand for residential dwellings and commercial spaces will fuel the market growth.
 

Modular construction yields time saving by facilitating simultaneous work both onsite and offsite and helping in better co-ordination. It also reduces efforts in onsite scaffolding and helps in avoiding weather impacts.
 

Prefabricated construction proves to be effective in minimizing project schedule & cost, improves productivity, and helps achieving economies of scale, since traditional onsite construction is both expensive and labor intensive. Modular construction is ideal in repetitive design elements. It proves to be effective in scheduling in sectors such as education institutions, hospitality, hospital complex, etc., where project timelines are strict. Therefore, modularization emerges as a vital construction alternative to plants and building owners.
 

Modular construction is anticipated to gain more popularity among developed nations due to their eco-friendliness, cost benefits, and energy-saving characteristics. Moreover, the modular & prefabricated construction market is witnessing increased attention and investment due to new technology adoption by market players. Changing consumer perceptions owing to employment of improved materials in construction for enhanced visual appeal of prefab buildings will support the market demand.
 

The lack of awareness is still prevailing in emerging economies, posing threats to the market. In addition, limited number of providers and increased logistics requirements and transportation are some of the primary challenges faced by owners. In many markets, modular construction is still expensive and needs constructive efforts to build efficient solutions for market penetration.
 

Furthermore, elevating COVID-19 crisis has created a new set of challenges for industry workers. COVID-19 has shrunken the economic output of top G7 countries around the world, and the construction industry is adversely affected. The coronavirus infection has reshaped consumer’s spending capacities. Supply chain disruptions and demand erosion will decrease the product demand.
 

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Rising adoption of permanent prefabricated construction will propel the industry growth

The permanent prefabricated construction market size valued at USD 82.75 billion in 2019 and is likely to witness 7.2% growth rate through 2026. Over 60% of modular construction is permanent, which utilizes offsite lean manufacturing to develop multistory building solutions. Permanent Modular Construction (PMC) uses prefabricated modules that are manufactured offsite and assembled on-site.
 

This type of construction is generally employed in stand-alone or site-built projects that deliver high-quality control and low wastage. Increasing need for office spaces in developed & developing economies is driving the modular & prefabricated construction market growth.
 

Superior properties of concrete material will escalate prefab construction demand

The concrete material segment accounted more than USD 13.67 billion revenue in 2019 and is poised to register growth rate of around 8.4% during 2020-2026. Concrete and modified concrete are used in a large percentage owing to their ability to give strength and stability to structures. Concrete modules can be molded into any shape and size.
 

Modular buildings are constructed to meet same building codes as onsite structures. They offer several benefits such as customization, easy installation, economic benefits, etc. Advancements in concrete technology and introduction of smart concrete in modular construction will create lucrative growth opportunities in the market.
 

Multi-family residential application will accommodate substantial modular & prefabricated construction market share

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Multi-family residential application will constitute nearly 45% of the global consumption in 2026 led by large-scale government-funded affordable housing schemes and soaring demand for housing in the rapidly growing economies of India, Indonesia, Malaysia, etc.
 

With rising density in urban cities, people are looking for quick and affordable housing; therefore, builders are seeking offsite construction to meet supply gap in the housing market, as modularization offers efficient alternative to multifamily structures. Factory-built process substantially reduces construction waste and offers faster delivery and reduced maintenance.
 

Europe to be among the leading regional markets

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The Europe modular & prefabricated construction market revenue is predicted to cross USD 70.4 billion by 2026. One of the major goals of the Europe construction industry is to promote green energy and encourage “smart infrastructure”. The policy aims to include substantial investment in technology and foster innovation in the construction industry.
 

Countries, such as Germany, Poland, the UK, Finland, and Sweden, will witness a modest growth rate through 2026 impelled by high product penetration, green building initiatives, reviving remodeling industry, and rapid upgrades in infrastructure projects. The UK government, in order to resolve housing issues, has committed to deliver 300,000 homes every year by 2020.
 

Sweden appears to be the leading country in adoption of prefabricated construction, with over 75% housing structures built offsite in factories, as people are focusing more on turnkey solutions. Increasing acceptance of 3D reinforced concrete modules will accelerate the construction rate of modular housing.
 

Acquisitions, low cost production, and geographical expansion are key strategies

Industry innovation and research are crucial factors for sustainable growth and survival in a competitive environment. Many product manufacturers try to secure funding for R&D activities. For instance, in July 2020, Totally Modular, a firm based in the UK, secured USD 2.2 million in funding from the UK Research and Innovation (UKRI). The market is moderately fragmented with companies focusing more on optimizing raw material procurement, supply chain, and logistics.
 

Major players involved in the modular & prefabricated construction market are ACS Group, Sekisui House Ltd., Laing O’Rourke, Skanska AB, Taisei Corporation, Katerra, Dubox, Kleusberg GmbH, Riko group, Algeco, Bouygues Construction, Red Sea Housing Services, Kiewit Corporation, Guerdon Modular Buildings, Hickory Group, Lendlease Corporation, Larsen & Toubro Limited, and Berkley Homes among others.
 

The market research report on modular & prefabricated construction includes in-depth coverage of the industry with estimates & forecast in terms of volume in square foot and revenue in USD million from 2016 to 2026, for the following segments:
 

Market, By Type

• Permanent
• Relocatable

Market, By Material

• Steel
• Wood
• Concrete
• Others (Aluminum, Polyurethane, Glass fiber etc.)

Market, By Application

• Steel Single Family Residential
• Multi-Family Residential
• Office
• Hospitality
• Retail
• Healthcare
• Others

The above information is provided on a regional and country basis for the following:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Spain
  • Italy
• Asia Pacific
  • China
  • India
  • Japan
  • Australia
  • Indonesia
  • Malaysia
• Latin America
  • Brazil
  • Mexico
• MEA
  • South Africa
  • GCC