May 29, 2024

Modular Construction Market Is Expected To Be Flourished By Cost Efficiency

Modular construction refers to a process in which a building is constructed off-site, under controlled plant conditions, using the same materials and designing principles as conventionally built facilities. Modular buildings are delivered to site in prefabricated, modular sub-units and then assembled accordingly. Modular construction offers reduced site disturbance, decreased construction timeframes, and cost effectiveness compared to traditional on-site methods. Modular buildings find widespread use as classrooms, homes, offices, healthcare facilities, and hotels. For instance, dormitories, student housing, and temporary lodging increasingly employ modular construction techniques to meet the ever-growing demand.

The global Modular Construction Market is estimated to be valued at US$ 84 Billion in 2023 and is expected to exhibit a CAGR Of 6.7% over the forecast period 2023 To 2030, as highlighted in a new report published by Coherent Market Insights.

Market Dynamics:

Cost Efficiency (as referred in the heading, modular construction is expected to be flourished by cost efficiency), is one of the primary drivers bolstering the modular construction market growth. Modular construction enables reduced wastage of materials as modules are pre-fabricated in a controlled factory environment. It further ensures less construction time, minimized labor costs, and enhanced productivity compared to on-site construction. As such, modular construction proves significantly cost-effective compared to traditional building methods over the life cycle of the project. Another major factor propelling the market expansion is reduced construction time. Prefabricating modules off-site allows simultaneous activities to be carried out and parts to be assembled parallelly, thereby decreasing time spent on the construction site and expediting project completion.

 

Segment Analysis

The modular construction market is segmented into the following categories – portable buildings, prefabricated bathrooms/toilets, and panelized walls. The portable buildings segment dominates the market as it accounts for over 45% share. The demand for portable buildings is high in construction sites as well as temporary structures in education, healthcare, and corporate sectors as they offer plug and play facilities.

PEST Analysis

Political: Construction rules and regulations promote the usage of modular construction techniques for their economic and environmental benefits. However, strict import duties increase the cost of procuring modules from other countries.

Economic: Modular construction helps reduce project costs and timelines significantly. The growing infrastructure investment and real estate sector boost the demand. However, high initial investment requirements pose challenges.

Social: Urbanization increases the housing demand. Modular techniques enable faster construction to meet this demand. Workplace safety also improves due to factory production and controlled environments.

Technological: Adoption of robotics, 3D printing, IoT, and building information modeling in the modular production streamlines design, planning, procurement, and assembly processes. This enhances productivity, quality, and sustainability.

Key Takeaways

The Global Modular Construction Market Demand is expected to witness high growth supported by the rising infrastructure investment and real estate construction. The global Modular Construction Market is estimated to be valued at US$ 84 billion in 2023 and is expected to exhibit a CAGR of 6.7% over the forecast period 2023 to 2030.

 

Regional analysis

 

The Asia Pacific region dominates the global modular construction market currently with over 35% share. China, Japan, and India are major markets in the region. Factors such as rapid urbanization, economic growth, and government support for infrastructure development have accelerated modular building adoption. The North American market is growing at a CAGR of 5.5% during the forecast period due to the high demand for modular structures from oil & gas, education, and healthcare sectors in the US and Canada.

 

Key players

 

Key players operating in the modular construction market are Red Sea International, Laing O’Rourke, Kleusberg GmbH, KEF Katerra, and Lendlease Corporation. Red Sea International and Laing O’Rourke are prefabricated bathroom/toilet system providers. KEF Katerra majorly focuses on panelized walls. Kleusberg GmbH and Lendlease Corporation provide total modular construction solutions.

Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it