The global modular construction market is expected to witness significant growth over the forecast period. It is a relatively new concept and accounted for a less than 5% share of the overall construction industry as of 2017. However, rapidly expanding construction sector across the globe is expected to drive the market over the years to come. This method includes prefabricated buildings where they are constructed in modules off-site in a controlled environment. Modules of such buildings are engineered independently and then transported to the actual site followed by assembling. Rising demand for modular constructed buildings from consumers across manufacturing, healthcare, industries, institutional, and commercial sectors is expected to drive the growth over the projected period.
Modular construction has several benefits over traditional systems including shorter project schedules, reduced costing, and improved quality control. The construction base formulation on-site and module formulation off-site can be done simultaneously, which helps reduce up to half of overall time required for the entire structure. Moreover, it is carried out in a protected and climate-controlled manufacturing environment, thus resulting in reduced wastage of materials. The process also includes specialized inspection of every module on regular basis, which ensures quality. Thus, better performance, quality, and durability are expected to open new avenues for the market growth. The assembly line used for this process helps manufacturers streamline purchasing and inventory of raw materials.
Furthermore, controlled environment at the sites allows the use of leftover materials for the next module generation. As a result, the overall cost required for the construction reduces significantly. Rising consumer awareness regarding these benefits is expected to drive the market over the estimated period. The optimized processes associated with modular construction including less number of raw material deliveries to the actual site and minimal wastage make it eco-friendly method. Furthermore, these modules can be reused and/or renovated. All these factors are boosting the demand for modular construction, thereby fueling the market growth. The industry can be segmented into types and applications. Relocatable and permanent are the two major types of building manufacturing process.
The relocatable segment is expected to gain high market share on account of its consumer-friendly properties, such as easy reusability. Furthermore, additional services provided by the manufacturers in short terms agreements to offer a lease on the expansion of offices, healthcare facilities and auditoriums is expected to attract consumer attention. Rising demand for relocatable modular constructions by corporations, government, and private buildings and retail shops is likely to propel market growth over the next few years. Based on application, the market can be segmented into residential, commercial, healthcare, educational, and industrial. Residential is the leading application segment and is likely to continue its dominance even during the forecast period.
Need for better and faster construction practices due to growing population across the world coupled with increasing consumer spending capacities has resulted in high demand for modular construction. Furthermore, popularity of identical structures in multi-story buildings, apartments, and row houses is expected to spur the growth in the years to come. Asia Pacific is expected to be the dominant regional market over the forecast period. Although, the region is witnessing lower penetration of these systems as compared to developed regions; high adoption of newer technologies due to government support and rising consumer awareness will drive the market growth in future.
The market has several manufacturers, with a moderate competition. Most manufacturers target Asian countries including India and China, wherein the construction industry is bolstering. Some of the key companies in the modular construction market include Laing O'Rourke, Kleusberg GmbH & Co. KG, KEF Katerra, Skanska AB, Red Sea Housing, and Lendlease Corporation.
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