Modular Construction Market Size, Share, Market Research and Industry Forecast Report, 2025 (Includes Business Impact of COVID-19)

  • TBI477801
  • November 28, 2020
  • No Countries Found
  • 132 pages
  • Lucintel

Industry Insights, Market Size, CAGR, High-Level Analysis: Modular Construction Market

The global modular construction market size was valued at USD 112.3 billion in 2018 and is expected to register a CAGR of 6.5% over the forecast period. Growing demand for affordable housing coupled with increasing investments in the development of healthcare and commercial infrastructure is anticipated to positively impact market growth. As per the industry surveys, modular construction accounts for 30% to 50% time savings over the traditional counterpart. The market is expected to witness a renewed interest from building & construction industry on account of growing emphasis on productivity, efficiency, and workplace safety along with reducing the time and cost associated with building activities. The U.K. is one of the leading markets for modular construction owing to its high rate of adoption. The chronic shortage of skilled labor, massive ongoing investment in residential housing development, and a renewed focus on upgrading healthcare infrastructure are expected to drive the market in the country over the forecast period. In countries such as Sweden, Canada, and Finland, extremely cold weather and shorter daytime inhibit traditional building methods. Consequently, modular construction has emerged as a logical alternative to conventional methods. As of 2018, around 85% of new houses in Sweden are built using some form of modular construction. Irrespective of the type of material used, modular option makes it possible to take advantage of economies of scale, faster speed, and improved quality control, thus, making it an increasingly attractive option. Furthermore, modular construction exhibits a substantial decrease in waste generation associated with traditional building methods. Lack of awareness, consumer perception related to quality, and difficulty in availing finances are some of the factors restraining the market growth. In addition, the threat of an economic slowdown in the key markets including the U.K., China, and the U.S. is anticipated to be a major barrier for market growth.

Type Insights of Modular Construction Market

Permanent modular construction has emerged as an alternative to traditional building methods over the past decade. Increase in per capita income and easy availability of finances are some of the factors responsible for the rising trend of owning a house, thereby, positively influencing market growth. In 2018, permanent modular segment held the largest share of 64.4% on account of growing demand for permanent housing, commercial, and industrial structures. Increasing financial outlay for the development of affordable housing structures coupled with the rapid growth of industrial sector in developing economies is expected to augment the market growth. Relocatable modular structures are utilized for the purpose of providing temporary accommodations for labors at the worksite. Relocatable modular structures are also utilized by a variety of end users including local governments, industrial corporations, school boards, healthcare providers as makeshift offices, healthcare clinics, temporary hotels, and schools. The Middle East and Africa is expected to generate a huge demand for relocatable modular construction over the forecast period. The rising trend of providing housing facilities to migrant blue-collar labors working on ongoing construction and industrial projects is expected to drive the market.

Application Insights of Modular Construction Market

Residential application segment is projected to account for the largest share in the modular construction market and is expected to advance at a CAGR of 6.9% over the forecast period. This can be attributed to an increase in residential housing construction activities in Asia Pacific with burgeoning population, rapid urbanization, and strong economic growth. Commercial application segment was valued at USD 15.8 billion in 2018 and is expected to advance at a CAGR of 6.2% over the projected period. Recovering economic situations in key markets such as the U.K., the U.S., and China are expected to generate robust demand for commercial spaces such as offices, showrooms, and hotels, thus, leading to an increase in commercial construction activities. Modular construction minimizes the extent of disruption and closure in the existing structure. Capital intensive sectors such as healthcare are increasingly using modular construction as a way of reducing the cost and shortening the construction schedules without compromising on the quality of building materials or design. The growing e-commerce industry coupled with rising industrialization has resulted in an increased demand for warehouses and inventory storage buildings. As a result, the demand for modular construction in industrial applications is expected to grow over the forecast period.

Regional Insights of Modular Construction Market

Residential application emerged as the leading segment in the U.K. and is expected to advance at a CAGR of 7.2% over the forecast period. The U.K. government aims to establish 300,000 residential houses annually over the next five years, which is expected to augment residential construction sector in the country. The plan is expected to positively impact the market for modular construction. Commercial construction industry in Canada is supported by growing demand for commercial spaces such as hotels, offices, and retail showrooms. Commercial application segment in the country is expected to reach USD 198.8 million by 2025, owing to the growth of commercial construction market and improved economic outlook. Europe was the second-largest market for modular construction in 2018, on account of high level of penetration in Germany, Finland, the U.K., and Sweden. Primary driving factor is expected to be the rising influx of migrants necessitating the building of temporary and permanent housing structures. The market for modular construction in India is expected to progress at a CAGR of 8.4% over the forecast period. Government of Indias ambitious scheme to provide permanent housing for all by 2022 is expected to provide a major boost to the market growth over the coming years.

Market Share Insights of Modular Construction Market

The market is characterized by the presence of small- and large-scale players, resulting in a moderate level of competition. Companies are focusing on R&D initiatives related to the use of raw material, supply chain management, transportation, and adoption of innovative methods to cope up with rising demand from residential, commercial, and industrial building applications. Key players in the market include Laing ORourke, Katerra, Skanska AB, Red Sea Housing, Dubox, and Sekisui House Ltd. A large number of startups have entered the modular construction industry and are garnering a huge interest from venture capital firms and angel investors. For instance, in January 2018, Katerra raised USD 865 million in a Series D funding round led by SoftBank.

Segmentations, Sub Segmentations, CAGR, & High-Level Analysis overview of Modular Construction Market Research Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis on the industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, this market research report has segmented the global modular construction market report based on type, application and region:

Type Outlook (Revenue, USD Million, 2019 - 2030)

  • Relocatable
  • Permanent

Application Outlook (Revenue, USD Million, 2019 - 2030)

  • Residential
  • Commercial
  • Industrial
  • Healthcare
  • Educational

Table of contents
Chapter 1. Methodology and Scope                    1.1. Research Methodology                    1.2. Research Scope & Assumption                    1.3. Information Procurement                        1.3.1. Purchased Database                        1.3.2. GVR’s Internal Database                        1.3.3. Secondary Sources & Third-Party Perspectives                        1.3.4. Primary Research                    1.4. Information Analysis                        1.4.1. Data Analysis Models                    1.5. Market Formulation & Data Visualization                    
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