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. Modules are delivery to the construction site to be incorporated into the overall design. Modular buildings provide a viable and cost-effective alternative to conventional stick-built construction by allowing work to take place simultaneously. The global modular construction market is gaining traction owing to benefits such as reduced waste, cost-effectiveness, and predictable schedule. Modular buildings are used in various commercial and residential applications such as hotels, apartments, retail stores, student housing, healthcare facilities, and offices.
The global modular construction Market is estimated to be valued at US$ 84.48 Bn 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
Fast-track construction is driving the modular construction market growth. Modular construction allows prefabrication of building blocks under controlled plant conditions that are later assembled onsite, significantly reducing the construction time. This helps in fast-track construction of residential and commercial projects. For instance, modular construction can reduce the construction time up to 30-50% compared to conventional methods. Additionally, issues related to labor shortage can be addressed using modular construction techniques. Prefabrication of building blocks does not entirely depend on onsite labor and various tasks can be performed simultaneously. This helps address challenges arising from labor shortage. Growing demand for fast-track construction from end-use industries such as healthcare, education, hospitality, and retail is expected to augment the modular construction market growth over the forecast period.
Segment Analysis
Modular Construction Market is segmented into four segments based on material, construction, product and end user. The residential sub-segment accounts for the major share in the global modular construction market. Increasing urban population and rise in demand for affordable housing are some of the key factors boosting the growth of residential sub-segment. The commercial sub-segment is expected to witness significant growth rate during the forecast period.
Pest Analysis
Political: Development of new regulations to ensure safety, sustainability and overall well-being of modular constructions is positively impacting the market growth.
Economic: Growth in construction industry and rise in disposable income levels are fueling the demand for modular construction worldwide.
Social: Preferences towards green and sustainable building solutions combined with advantages such as cost-effectiveness are driving consumers towards modular construction.
Technological: Emergence of advanced technologies and innovative building materials are enabling modular construction players to deliver faster, more durable and eco-friendly building solutions.
Key Takeaways
The Global Modular Construction Market Growth is expected to witness high growth during the forecast period of 2023 to 2030. The global modular construction Market is estimated to be valued at US$ 84.48 Bn in 2023 and is expected to exhibit a CAGR of 6.7% over the forecast period 2023 to 2030.
Regional analysis indicates that Asia Pacific region dominated the global market in 2023 and is expected to maintain its dominance through 2030. Factors such as rapid urbanization and increasing infrastructure investments across China and India are fueling the regional market growth.
Key players operating in the Modular Construction Market are Lendlease, Laing O’rourke, Red Sea Housing, Bouygues Construction and Atco Ltd. Key players Dominion Modular, Katerra, Stack Modular, Guerdon Modular Buildings and Westchester Modular Homes. Key players are investing in R&D to develop advanced modular construction techniques for varieties of end use segments like commercial, healthcare and others.
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1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it