Aug 12, 2021 (Market Insight Reports) -- Modular & Prefabricated Construction Market size is expected to exceed USD 174.37 billion by 2026. Increasing government initiatives to build housing complexes infrastructure will escalate the prefab construction demand.
Increasing trends of modern infrastructure will lead to huge acceptance of prefabricated construction techniques since the construction sector is a dynamic part of any nation's economy. In recent years, there has been a spike in urban centers as population migrated from countryside into cities for enhanced lifestyle. Factory-built construction modules provide faster delivery and execution. Off-site construction of building components enables more controlled environment and allows for improved precision & quality during fabrication. It also increases worker safety, technological efficiency, site safety, and provides more flexibility and reuse. These factors will help reduce the liability costs for contractors.
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Increased safety in offsite construction approach will drive the modular & prefabricated construction market. With improved conditions of factory settings, workers are less exposed to weather delays and there is high control in factory production with a smaller crew. These advancements will significantly improve project quality and provide competitive edge when compared to traditional onsite construction.
The construction industry is growing at a modest rate. As per oxford economics, the U.S. is estimated to grow faster than China in coming 15 years. India construction in emerging markets is anticipated to grow almost twice as fast as China during the same period. The consumer and service-driven economies will provide growth impetus to modularization in social infrastructures, healthcare, education, retail, etc.
The wood segment will grow at a stable CAGR and hold over 32% demand share by 2026. Growing utility of cross-laminated timber for sustainable framing in residential as well as commercial construction such as restaurants, hotels, press boxes, warehouses, stores, etc. as low-cost alternative to steel frameworks will escalate wood demand. Wood material is ideal in up to five level construction of multi-family dwellings. Wood-based modular apartments, townhouses, and duplexes are ideal in cities with housing shortage, and the process also delivers improved results for construction in the expensive labor market in urban settings.
Modular & prefabricated construction revenue from the hospitality segment will reach USD 38.72 billion by 2026. This segment is well positioned to capitalize on prefabricated construction methods as it significantly minimizes project schedule. The hospitality sector is highly dependent on cost-effective construction. Strong collaborations between hotel chains and modular builders have resulted in increased modular hotel constructions. For instance, projects, such as Marriott international 360-foot-tall AC Hotel New York NoMad, have set a new benchmark in modular construction.
The Middle East & Africa is expected to grow at a stable growth of 6.6% CAGR. Increasing population in the region has stimulated the demand for housing facilities, creating a significant impact on modular construction. Moreover, GCC countries have included their long-term supply strategy of project developments that focus on social infrastructure, which will lead to more opportunities for the Middle East modular construction industry in coming years.
Key industry participants are investing in low-cost materials, improved logistics, and strategic partnerships to dominate the modular and prefab industry. In January 2019, Sekisui House, a Japanese house manufacturer, in collaboration with the UK government provided residential housing products to meet the increasing demand.
Other major players in the Modular & Prefabricated Construction Market include 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.
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Some major findings of the modular & prefabricated construction market report include:
The U.S. and Europe held a significant market share in 2019, with high penetration rate of modularization, the regions will deliver increased annual cost savings to developers. Strong demand from multi-family dwellings and the hospitality sector will bring new opportunities in the market.
Concrete material will generate significant revenue of over USD 13.67 billion in 2019 and is estimated to follow the same trend in the coming years. Precast concrete is generally employed in the fabrication of 3D modules.
Permanent modular construction (PMC) is dominant in the modular & prefabricated construction market and will contribute over 64% in the product demand worldwide by 2026. Easy availability of finances and increase in per capita income are positively influencing house ownership trends.
The multi-family residential application segment constitutes majority share in the overall market and is anticipated to grow at a CAGR of 7.2% worldwide by 2026. Rise in Public-Private Partnerships (PPPs) in infrastructure development and demographic shift have escalated the modular construction industry.
Market players are engaged in strategic joint ventures and expanding geographic reach to gain a competitive edge
The COVID-19 pandemic has drastically impacted the off-site construction industry. With shut down of manufacturing plants, there is a shortage in labor supply. The difficulty in procuring raw materials and government restrictions on social distancing might hinder market growth.
Table of Contents (ToC) of the report:
Chapter 1. Methodology And Scope
1.2. Market definition
1.3. Market estimation & forecast parameters
1.3.1. Base estimation & working
126.96.36.199. North America
1.4. Data sources
Chapter 2. Modular & Prefabricated Construction Market Summary
2.1. Modular & prefabricated construction industry 360� synopsis, 2016 - 2026
2.1.1. Business trends
2.1.2. Type trends
2.1.3. Material trends