Modular Construction Market by Type, Material, End-user: Global Opportunity Analysis and Industry Forecast, 2021-2031

Executive Summary

The Modular Construction Market is likely to experience a significant growth rate of 6.1% from 2022-2031 owing to increasing market demand from Residential Construction sector.

Modular construction is a process in which an off-site construction of a building is completed, using the same design, standards, and materials. The construction of the buildings is done in a modules format, which is then put together on site. The modular construction creates fewer site disturbances and generates less waste as compared to traditional construction. In addition, the disassembling of modular buildings can be achieved easily, and can be refurbished and relocated for new modular homes, thus minimizing the demand for raw materials and the need for energy to construct new buildings.

Modular construction is utilized for permanent or temporary facilities such as military housing, classrooms, classrooms, construction camps, and industrial facilities. Moreover, modular houses and buildings are used in remote areas where conventional construction is not possible. Furthermore, modular construction finds its major application in healthcare facilities, churches, fast food restaurants, and commercial offices. In addition, it is gaining increased popularity, owing to its benefits such as ability to serve remote locations, low waste generation, environmentally friendly construction process, enhanced flexibility, high quality, and increased market acceptance.

The growth of the global modular construction market is driven by increase in urbanization & industrialization in developing countries. In addition, upsurge in population is anticipated to have a significant impact on the growth of the market to cater to the increasing needs of consumers. Furthermore, rise in demand for jobs, housing, energy, clean water, food, transportation infrastructure, and social services leads to higher adoption of cost-effective modular construction technologies to ensure uniform quality.

In addition, surge in population and matured urbanization in developing countries, such as India, Brazil, and others, increase the need for new residential and commercial construction. In addition, factors, such as time required for construction and upsurge in demand for new construction and modularized construction, drive the growth of the modular construction market.

Benefits associated with modular construction products are easy to install, easy to transport, space constraints, and provide an aesthetic look. Modular construction used in marine transportation protects from natural calamities, such as tsunami, earthquakes, and others. In addition, the manufacturers of modular construction are focusing on business expansion and new projects as strategies to increase their market share. For instance, in October 2020, SG Blocks entered into a strategic partnership with Harrison, Walker and Harper (HWH), an engineering, contracting, and industrial services firm. Under this alliance, HWH will become an SGB preferred partner to complete site work and installation of single-family modular homes. Similarly, in September 2020, SGB and its subsidiary, SG Residentials, entered into a partnership with Capital Plus Financial (CPF), one of the largest Community Development Financial Institutions (CDFI) in the U.S. and a subsidiary of Crossroads Systems, Inc. With this partnership, SGB aims to provide affordable modular homes at low-to-moderate-income areas across the country and Puerto Rico.

An increase in demand for prefabricated housing units, owing to reduction in construction cost & time and government initiative toward green building concept is predicted to cater to the growth of the modular construction market. Many competitors, architects, and builders are taking advantage of used shipping containers for building homes.

However, outbreak of COVID-19 has led to halt in construction and manufacturing activities across the globe. This, in turn, hindered the growth of the modular construction market for a very small period. Conversely, different industries are gradually resuming their regular manufacturing and services with the launch of vaccines and reduction in number of COVID-19 cases. This is leading to re-initiation of companies at their full-scale capacities, that helped the market to recover by end of 2021. In addition, lack of reliability on modular construction in earthquake-prone regions considerably hampers the growth of modular construction market.

On the contrary, increase in investments in infrastructure is anticipated to offer lucrative growth opportunities for the market players during forecast period.

Rise in need for protection of architecture from environmental impacts, increase in government focus on green building concepts, and modular construction for space constraints in large cities are anticipated to drive the growth of the modular construction market. In addition, rising infrastructure spending in various countries, such as Germany, France, India, and others, surges the demand for modular construction, and thus drives the growth of the modular construction market. For instance, in Hesse region, a total of 6,796 buildings were completed in 2020, out of which 11,640 included prefabricated homes. A rise in focus toward affordable housing structures and increase in need for modular construction, owing to features, such as quicker build, easy to relocate, and portability, are anticipated to provide lucrative growth opportunities for the modular construction market. In addition, urban population is focusing on modular construction to afford cheaper living as these containers require less cost as compared to traditional container houses. In 2020, the U.S. government's housing program funded around $10 million to build modular construction buildings. In addition, scarcity of housing units in developing economies, such as Africa and India, is expected to provide lucrative opportunities for the growth of the modular construction market during the forecast period.

Moreover, developed countries, such as the U.S., Japan, the UK, and others, had implemented initiatives that focus on building, designing, and installing green building concept. This modular construction has features, such as cost-effective and energy-effective prefabricated products, for construction, which, in turn, drive the growth of the modular construction market. Factors, such as reduced cost and time required for modular construction and rise in demand for prefabricated products for residential and commercial construction activities, drive the growth of the modular construction market.

In addition, increase in urban population and industrialization in developed countries, such as the U.S., Japan, France, and Canada, surges the demand for modular construction, owing to features such as space issues, movability, and easy of transport. Modular construction is compact and easy to move from one place to other, which drives the growth of the modular construction market. However, modular or prefabrication products need to install heating ventilation and air conditioning systems in extreme cold and hot regions, which is anticipated to hamper the growth of the market. Conversely, upsurge in demand for new construction and increase in focus toward affordable housing structures are anticipated to provide lucrative opportunities for the growth of the modular construction market..

The modular construction market is segmented on the basis of type, material, end user and region. On the basis of type, the market is bifurcated into permanent and relocatable. On the basis of material, the market is classified into steel, wood, concrete, and others. On the basis of end user, the market is divided into residential, commercial, and industrial. On the basis of region, the modular construction market is analyzed across North America (the U.S., Canada, and Mexico), Europe (Germany, the UK, France, Italy, and rest of Europe), Asia-Pacific (China, India, Japan, South Korea, and rest of Asia-Pacific), and LAMEA (Latin America, Middle East, and Africa)
COMPETITION ANALYSIS
The major players profiled in the modular construction market report included are ATCO, Anderco Pte. Ltd, Giant Containers Inc, Bechtel Corporation, Lendlease Corporation, SG Blocks Inc, Skanska AB, Speed House Group of Companies, Supertech Industries LLC, Fluor Corporation, and Modulaire Group.

Major companies in the market have adopted product launch, partnership, business expansion, and acquisition as their key developmental strategies to offer better products and services to customers in the modular construction market.

Key Market Insights

• By type, the permanent segment was the highest revenue contributor to the market and is estimated to reach $158.6 billion by 2031, with a CAGR of 5.7%. However, the re-locatable segment is estimated to be the fastest-growing segment with a CAGR of 7.0% during the forecast period.
• By material, the steel segment dominated the global market. However, the concrete segment is expected to be the fastest-growing segment with a CAGR of 10.6% during the forecast period.
• Based on end user the residential segment was the highest revenue contributor to the market with a CAGR of 5.3% during the forecast period.
• Based on region, North America garnered the largest revenue share in 2020, whereas Asia-Pacific is anticipated to grow at the highest CAGR of 7.4% during the forecast period

Companies Mentioned

• Skanska AB
• Supertech Industries
• Tempohousing
• Giant Containers Inc.
• SG Blocks, Inc.
• Honomobo Corporation
• Bechtel Corporation
• ATCO Ltd.
• Lendlease Corporation
• Speed House Group of Companies

Methodology

The analyst offers exhaustive research and analysis based on a wide variety of factual inputs, which largely include interviews with industry participants, reliable statistics, and regional intelligence. The in-house industry experts play an instrumental role in designing analytic tools and models, tailored to the requirements of a particular industry segment. The primary research efforts include reaching out participants through mail, tele-conversations, referrals, professional networks, and face-to-face interactions.

They are also in professional corporate relations with various companies that allow them greater flexibility for reaching out to industry participants and commentators for interviews and discussions.

They also refer to a broad array of industry sources for their secondary research, which typically include; however, not limited to:

• Company SEC filings, annual reports, company websites, broker & financial reports, and investor presentations for competitive scenario and shape of the industry
• Scientific and technical writings for product information and related preemptions
• Regional government and statistical databases for macro analysis
• Authentic news articles and other related releases for market evaluation
• Internal and external proprietary databases, key market indicators, and relevant press releases for market estimates and forecast

Furthermore, the accuracy of the data will be analyzed and validated by conducting additional primaries with various industry experts and KOLs. They also provide robust post-sales support to clients.