GVR Report cover Modular Construction Market Size, Share & Trends Report

Modular Construction Market Size, Share & Trends Analysis Report By Type (Permanent, Relocatable), By Application (Residential, Commercial, Healthcare, Educational), By Region, And Segment Forecasts, 2021 - 2028

  • Published Date: Dec, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-3-68038-561-8
  • Format: Electronic (PDF)
  • Historical Data: 2017 - 2019
  • Number of Pages: 102

Report Overview

The global modular construction market size was valued at USD 84.4 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 6.4% from 2021 to 2028. Growing demand for affordable housing, coupled with increasing investments in the development of healthcare and commercial infrastructure, is anticipated to positively impact market growth.

U.K. modular construction market size, by type, 2018 - 2028 (USD Billion)

As per industry surveys, modular construction accounts for 30-50% time savings over its traditional counterpart. The market is expected to witness a renewed interest from the building and 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 2020, around 84% of new houses in Sweden are built using some form of modular construction.

Irrespective of the type of material used, the 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 of finances are some of the factors restraining the market growth. Also, 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 to market growth.

Product Insights

The permanent modular construction segment led the market and accounted for the largest revenue share of 63.8% in 2020 due to increased efficiency as compared to traditional building methods over the past decade. An 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 the market growth.

The increasing financial outlay for the development of affordable housing structures coupled with the rapid growth of the industrial sector in developing economies is expected to augment the market growth. In addition, a reduction in wastage in modular construction is also expected to drive industry growth.

Relocatable modular structures are utilized to provide temporary accommodations for laborers at worksites. Relocatable modular structures are also utilized by a variety of end-users including local governments, industrial corporations, school boards, and healthcare providers as makeshift offices, healthcare clinics, temporary hotels, and schools.

The Middle East and Africa are 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 laborers working on ongoing construction and industrial projects is expected to drive the market.

Application Insights

The residential application segment led the market and accounted for the largest revenue share of 52.8% in 2020. This can be attributed to an increase in residential housing construction activities in the Asia Pacific with a burgeoning population, rapid urbanization, and strong economic growth, which is expected to emerge as a key driver for the growth of the industry.

The commercial application segment was valued at USD 83.8 billion in 2020 and is expected to witness a CAGR of 4.2% 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.

Global modular construction market share, by application, 2020 (%)

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

Europe dominated the modular construction market and accounted for the largest revenue share of 45.7% in 2020. This was due to the growing efforts of the governments in the region to adopt modular construction. In addition, one of the key factors driving the industry growth is expected to be the rising influx of migrants necessitating the building of temporary and permanent housing structures.

The U.K. government aims to establish 300,000 residential houses annually over the next five years, which is expected to augment the residential construction sector in the country. The plan is expected to positively impact the market for modular construction.

The commercial construction industry in Canada is supported by the growing demand for commercial spaces such as hotels, offices, and retail showrooms. The commercial application segment in the country is expected to reach USD 2,644.4 million by 2028, owing to the growth of the commercial construction market and improved economic outlook.

The market for modular construction in India is expected to progress at a CAGR of 5.7% over the forecast period. The government of India’s 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.

Key Companies & Market Share Insights

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 the adoption of innovative methods to cope up with rising demand from residential, commercial, and industrial building applications.

Key players in the market include Laing O'Rourke, 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. Some of the prominent players in the modular construction market include:

  • Laing O'Rourke

  • Katerra

  • Skanska AB

  • Red Sea Housing

  • DuBox

  • Sekisui House Ltd

  • KLEUSBERG GmbH & Co KG

Modular Construction Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 85.6 billion

Revenue forecast in 2028

USD 138.9 billion

Growth Rate

CAGR of 6.4% from 2021 to 2028

Base year for estimation

2020

Historical data

2017 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD million and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Type, application, region

Regional scope

North America; Europe; Asia Pacific; Central and South America; Middle East & Africa

Country scope

U.S.; Canada; Mexico; U.K.; Sweden; Germany; China; India; Brazil; Japan; Australia; Singapore; Saudi Arabia, UAE

Key companies profiled

Laing O'Rourke; Katerra; Skanska AB; Red Sea Housing; DuBox; Sekisui House Ltd.; KLEUSBERG GmbH & Co KG

Customization scope

Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope.

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Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2028. For the purpose of this study, Grand View Research has segmented the global modular construction market report on the basis of type, application, and region:

  • Type Outlook (Revenue, USD Million, 2017 - 2028)

    • Relocatable

    • Permanent

  •  Application Outlook (Revenue, USD Million, 2017 - 2028)

    • Residential

    • Commercial

    • Industrial

    • Healthcare

    • Educational

  • Regional Outlook (Revenue, USD Million, 2017 - 2028)

    • North America

      • U.S.

      • Canada

      • Mexico

    • Europe

      • Germany

      • U.K.

      • Sweden

    • Asia Pacific

      • China

      • India

      • Japan

      • Australia

      • Singapore

    • Central & South America

      • Brazil

    • Middle East & Africa

      • Saudi Arabia

      • UAE

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