Portugal Construction Market

Portugal Construction Market Size

Portugal Construction Market size was valued at USD 11.6 billion in 2022 and is projected to grow at a CAGR of 2.5% between 2023 and 2032. The country's growing urbanization and population create a strong demand for residential, commercial, and infrastructure construction projects. Urbanization leads to the concentration of population in urban areas, driving the need for new housing developments. As more people migrate to cities, the demand for residential buildings, such as apartments and houses, rises. This presents opportunities for construction companies to meet the housing needs of the growing urban population.

The government focus on infrastructure development and investments in the construction sector is significantly driving Portugal construction market growth. The government recognizes the importance of enhancing the country's infrastructure to drive economic growth, attract investments, and improve the quality of life for citizens. Through strategic planning and increased budget allocations, the government aims to modernize and expand Portugal's infrastructure networks including transportation, energy, telecommunications, and water management systems. This commitment to infrastructure development creates a favorable environment for construction companies as it leads to a surge in construction projects.

The emerging safety and labor issues pose significant challenges to the market. Ensuring the safety and well-being of workers is a top priority, and construction companies must comply with the strict health & safety regulations to minimize accidents and injuries. Labor issues, such as shortages of skilled workers, changing labor laws, and demands for fair wages as well as working conditions, can impact project timelines and costs. The construction industry must invest in training programs, adopt advanced safety measures, and implement fair labor practices to attract & retain skilled workers.

COVID-19 Impact

The COVID-19 pandemic affected Portugal's construction industry, causing disruptions in supply chains, labor shortages, and project delays. Social distancing measures and lockdown restrictions led to the temporary closure of construction sites, hampering ongoing projects. Uncertainty in the economic landscape resulted in decreased investments, impacting the industry's growth. However, with the easing of restrictions, the market has shown signs of recovery, but challenges remain in the post-pandemic period.

Portugal construction Market Trends

There is a growing emphasis on sustainable construction practices and green building certifications in Portugal. The market is witnessing increased adoption of energy-efficient designs, renewable energy integration, and eco-friendly materials to meet the environmental standards and promote sustainable development. The Portugal construction industry is undergoing a digital transformation with the integration of technologies such as Building Information Modeling (BIM), virtual reality, and drones. These technologies are being used for improved project planning, design visualization, construction management, and quality control.

Portugal Construction Market Analysis

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The residential construction market reached USD 2.5 billion revenue in 2022 and will register over 3% CAGR during the forecast period. Increased urbanization and population growth have spurred demand for new housing developments, especially in major cities and their outskirts. Government incentives and policies supporting the real estate sector, along with attractive mortgage rates, have encouraged private investments in residential projects.

For example, in November 2022, Santander Bank agreed to provide USD 51.3 million in financing to The Social Hub (TSH) for developing a 26,600-square-meter facility in Porto. In the heart of the city, TSH will provide a 13,467-sqm hotel and student housing complex with 305 rooms, co-working areas, dining establishments, event venues, gyms, and rooftop swimming pools.

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The Portugal construction market from private sector segment accounted for 60% of revenue share and is set to surpass USD 9 billion by 2032. Real estate development is a key growth driver of the private sector segment in the market. Private developers engage in residential, commercial, and mixed-use projects to capitalize on the demand for properties, both for sale and rental purposes.

Additionally, the private sector responds to the demand for commercial and industrial spaces. Companies require offices, retail spaces, warehouses, factories, and other facilities for their operations. Private developers and investors capitalize on this demand by constructing commercial & industrial properties.

The Portugal construction market from general contracting segment recorded more than USD 4.5 billion revenue in 2022 and will reach USD 6 billion by 2032. General contractors play a crucial role in upholding quality and safety standards in construction projects. They possess project management expertise, which is highly valued in the construction industry. Their ability to oversee & coordinate complex projects, manage resources, and ensure timely & cost-effective project delivery makes them indispensable in the market.

Portugal Construction Market Share

Major companies operating in the market include:

• Hilti group
• Arcadis
• Acciona
• TPF
• Pinto & Cruz
• FDO Construções
• Eiffage
• Mota-engil
•  Sotécnica.
  

Portugal construction Industry News

• In March 2023, Hilti and Construction Robotics Company Canvas announced strategic partnership. This collaboration brings together leaders in intelligent jobsite robotics they all share the same belief that robotic tools will unleash previously unrealized potential and usher in a new era of productivity and safety for skilled tradespeople.
  

The Portugal construction market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD Billion) from 2005 to 2032, for the following segments:

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Market, By Type

• Residential Construction
• Commercial Construction
  • Sports Facilities Construction
  • Hospitality Facilities Construction
  • Retail Facilities Construction
  • Office Buildings Construction
• Industrial Construction
• Infrastructure & Heavy Civil Construction
• Institutional Construction
  • Healthcare Facilities Construction
  • Educational Facilities Construction
• Mixed-Use Construction
• Specialized Construction
• Renovation/Remodeling Construction
• Environmental Construction

Market, By End-Use

• Private sector
• Public sector

Market, By Contracting Type

• General contracting
• Design-build contracting
• Construction management

Market, By Scale

• Mega project
• Major project
• Medium project
• Small project