Global Modular Construction Market Outlook
Revenue, 2023
$112B
Forecast, 2033
$218B
CAGR, 2024 - 2033
6.9%
The Modular Construction industry revenue is expected to be around $128.2 billion in 2024 and expected to showcase growth with 6.9% CAGR between 2024 and 2033. Modular construction is changing the game in the construction industry with its cost effective solutions that are also environmentally friendly across a variety of uses. In 2024, the modular construction market was valued at USD 118.5 billion and is expected to grow to USD 180 billion by 2030 and possibly reach USD 248 billion by 2035 with CAGR of 6.9%. This growth is fueled by urbanization trends, lack of labor and a growing need for affordable housing, in different areas.
The process of construction includes creating building parts off site and then moving them to the actual construction site for assembly purposes. This method is recognized for its adaptability, speed and positive impacts on the environment. It is becoming more popular in business and institutional ventures due to its ability to scale up using standardized materials and cutting edge technologies which in turn leads to less wastage making it a favored choice, among developers seeking efficient ways to cater to increasing needs.
Market Key Insights
- The Modular Construction market is projected to grow from $112.2 billion in 2023 to $219 billion in 2033. This represents a CAGR of 6.9%, reflecting rising demand across Permanent Modular Construction, Steel Modular Construction and Relocatable Modular Construction.
- Laing O'Rourke, Skanska, Katerra are among the leading players in this market, shaping its competitive landscape.
- U.S. and China are the top markets within the Modular Construction market and are expected to observe the growth CAGR of 4.5% to 6.6% between 2023 and 2030.
- Emerging markets including India, Brazil and Mexico are expected to observe highest growth with CAGR ranging between 7.9% to 9.5%.
- Transition like Integration of Smart Building Technologies has greater influence in United States and China market's value chain; and is expected to add $6 billion of additional value to Modular Construction industry revenue by 2030.
- The Modular Construction market is set to add $106 billion between 2023 and 2033, with service providers targeting Concrete & Wood Material projected to gain a larger market share.
- With Reduced construction time, and Sustainability and waste reduction, Modular Construction market to expand 95% between 2023 and 2033.
Opportunities in the Modular Construction
Advancements in materials and automation tech are also allowing for the creation of designs and enhancing the effectiveness of modular production processes.
Growth Opportunities in North America and Asia-Pacific
In North America's construction sector, modular construction is thriving due to the need for cost-optimum housing options and modernized healthcare facilities and commercial structures. The industry giants such as WillScot and Algeco are dominating the market by meeting the rising demand, for modular units.
The Asia Pacific region is observing a rise in modular construction activity with a notable focus in China and India due to urbanization and government efforts to enhance accessible housing options are driving the demand upwards for such solutions. Companies such as Katerra are scaling up their operations to cater to the increasing requirements, in these areas
Market Dynamics and Supply Chain
01
Driver: Reduced Construction Time, and Cost-Effective Solutions
Modular construction can also greatly cut down project schedules as it enables on site prep and module fabrication off site to happen at the time a key advantage, for developers working against tight deadlines. By simplifying the building process and cutting down on labor expenses modular construction provides cost effective solutions especially in areas grappling with a shortage of workers or soaring construction costs.
Modular building techniques produce waste than conventional methods because they make better use of materials in well managed factory settings that promote sustainability in line, with worldwide eco-friendly construction efforts.
02
Restraint: High Initial Investment, and High Initial Investment
Setting up factories and investing in advanced machinery can be quite expensive initially, for small to medium sized construction companies.
Setting up factories and investing in advanced machinery can be quite expensive initially, for small to medium sized construction companies.
03
Opportunity: Growing Demand for Sustainable Buildings and Expansion in Emerging Markets
The increasing demand for friendly buildings has led to a rise in the popularity of modular construction. This sustainable approach helps carbon emissions and align with sustainability objectives in various parts of the world.
In countries such as India and Brazil growing economies offer potential for modular construction due to the rising need, for cost effective housing and business infrastructure.
04
Challenge: Logistical Challenges
Moving pre-fabricated sections to building locations can be tricky and expensive. This is especially true in cities, with streets and limited space.
Supply Chain Landscape
1
Material Supplier
2
Modular Manufacturer
3
Transportation Provider
4
Contractor
1
Material Supplier
2
Modular Manufacturer
3
Transportation Provider
4
Contractor
Applications of Modular Construction in Permanent , Steel & Relocatable
Permanent Modular Construction : This approach is employed for creating lasting solutions over time that offer the level of robustness and excellence as conventional construction techniques but with shorter project durations in mind. Prominent industry leaders such as Laung O'Rourke and Skanska have spearheaded its adoption, in residential and healthcare.
Relocatable Modular Construction : Relocatable modular units are created to be used temporarily or semi permanently. Offer versatility for sectors like education and healthcare Companies such as WillScot and Mobile Modular specialize, in supplying mobile and reusable construction units
Steel Modular Construction : Steel is valued for its robustness and longevity. Qualities highly sought after in constructing buildings in city settings. Companies like Katerra and Algeco spearhead advancements in steel construction solutions.
Wood Modular Construction : Wood based modular construction is a favored choice for projects due to its sustainable nature and pleasing aesthetic appeal. Companies such, as Modscape and Eco Fast Modular excel in creating wood based modular designs.
Recent Developments
The latest advancements in building highlight the increasing importance of smart technologies and sustainability within the construction industry landscape. The residential project by Laung O’Roarke and the hospital initiative by Skanska demonstrate a trend towards paced and top notch construction practices. Furthermore; Katerra's expansion into India signifies an escalating need for modular construction solutions—especially, in developing markets.
September 2023 : Construction company Lainge O'Rourke successfully finished a modular housing project, in the United Kingdom.
June 2023 : Skanska revealed plans for a modular hospital initiative, in Sweden that incorporates state of the art steel modules.
March 2023 : Katerra recently opened a modular manufacturing plant in India as part of its expansion efforts, in Asia.
Impact of Industry Transitions on the Modular Construction Market
As a core segment of the Construction Technologies & Innovation industry,
the Modular Construction market develops in line with broader industry shifts.
Over recent years, transitions such as Integration of Smart Building Technologies and Shift Toward Circular Economy have redefined priorities
across the Construction Technologies & Innovation sector,
influencing how the Modular Construction market evolves in terms of demand, applications and competitive dynamics.
These transitions highlight the structural changes shaping long-term growth opportunities.
01
Integration of Smart Building Technologies
The modular building sector is integrating technologies, like Internet of Things (IOT) systems and automated climate control to improve the efficiency and attractiveness of constructions. This industry transition is expected to add $6 billion in the industry revenue between 2023 and 2030.
02
Shift Toward Circular Economy
The modular building sector is embracing the concepts of the economy by encouraging the reuse and recycling of materials and reducing construction waste. This promotes an eco friendly approach, to construction.