The global modular construction market is expected to witness a CAGR of 7.5% during the forecast period. Modular building is the prefabricated buildings which are manufactured at a remote manufacturing site and then delivered to end-user.  Some of the advantages of modular construction buildings include that they can be built in a shorter period of time as they are manufactured in mass production. Due to this reason, they are cheaper in price. Moreover, modular buildings can be manufactured in all weathers as they are manufactured at a production facility, whereas weather can be a hurdle for conventional construction at some places. The method is also beneficial for high-quality control during construction along with less generation of wastage. Such benefits offered by the modular construction building spurs its demand; and thereby, contribute to the growth of the global modular construction market.

One of the factors contributing to the modular construction industry includes rising infrastructural development globally. Urbanization is one of the key factors that is enhancing the infrastructural development activities in the cities. According to the United Nations in 2018, 55% of the urban population lives in the urban area, which was around 4.2 billion. It is expected to be 68% by 2050, which will be more than 6 billion people. As per World Urbanization Prospects by the United Nations, the largest urban growth will take place in India, China, and Nigeria. Managing urban areas is one of the most important development challenges for the government in the upcoming period. The urbanization is increasing at a significant level as in 2014 there were only 28 mega-cities (a city with more than 10 million people) which is expected to reach 43 by 2030. As cities are getting denser, building construction is getting tougher due to lack of space for building material. Strict government regulation regarding air and noise pollution is also motivating contractors to work at a remote location from the construction area, which will augment the market.

Segmental Outlook  

The global modular construction market is segmented on the basis of type, material, and end-user. By type, the market is divided into permanent and relocatable. Permanent modular construction is expected to have a significant share owing to the increasing need for affordable houses. Permanent modular building is employed in several sectors including residential, K-12 education, office and administrative spaces, healthcare, retail and hospitality, and publicly-funded facilities. Further, a relocatable modular building has a wide application such as in residential facilities, water closet, and temporary brides for emergency services. By material, the market is divided into concrete, steel, wood, and other materials. Wood was a major raw material used earlier in prefabricated building whereas now steel is gaining a significant pace in the market.

Residential Will be the Major Segment By the End-User

By end-user, the global modular construction market is segmented into residential, commercial, and industrial. It is expected that the residential segment will have the major market share and will grow with considerable market growth owing to the increasing rate of urbanization globally. Commercial and industrial will exhibit considerable market growth during the forecasted period. Multinational construction companies have started shifting towards the trend of modular construction for getting the projects done due to benefits offered by modular buildings such as quality control, faster build time, and cost savings.

Global Modular Constructions Market Share by End-User, 2018 (%)

Regional Outlook

On the basis of geography, the global modular construction market is divided into North America, Europe, Asia-Pacific and Rest of the World. Asia-Pacific is expected to hold a significant share in the global market owing to the contribution from major economies such as China. the rapid rise in the number of populations in India and China has resulted in increasing construction activity in the region. The key areas of expected growth include schools, hospitals, social infrastructure, government accommodation, and water resources. Further, North America will also contribute considerably due to the significant adoption of pre-engineered buildings. Moreover, major economies contributing to the European market include UK, Germany, France, Spain, and Italy,

Global Modular Construction Market Growth, by Region 2019-2025

Asia-Pacific to Hold a Significant Share

It is expected that the Asia-Pacific will contribute significantly to the growth of the market. It is due to the high rate of urbanization in developing countries such as India, China, Indonesia, and others. Hilly areas in this region are one of the prominent areas where a considerable market can be found. It is due to the advantage of modular homes over conventional construction. Asia-Pacific is also expected to witness considerable growth during the forecast period owing to increasing construction projects in the region. Further, Rest of the World is expected to show modest growth as, in order to provide economical education and healthcare facilities, several NGOs are expected to provide modular facilities in the under-developed region.

Market Players Outlook

Some of the major players that contribute to the growth of the global modular constructions market include ATCO Ltd., Bouygues Construction SA, Larsen & Toubro Ltd., Laing O'Rourke, Vinci SA, Red Sea International Co., KLEUSBERG GmbH & Co. KG, and Algeco Group. The market players are considerably contributing to market growth by adopting various strategies such as new product launch, collaborations, technological advancements, and various others to stay competitive in the market. Further, merger and acquisition have been observed as one of the major growth strategies adopted by the players.

Major Activities

• In February 2019, ATCO Ltd. acquired modular operations in Mexico, which will now be operating under the name, ATCO Espaciomovil. The manufacturing unit has facilities to construct workforce accommodation, classrooms, offices, hospitals, and retail and commercial buildings. With this acquisition, the company has diversified its growing portfolio in Mexico.
• In August 2018, WillScot Corp. completed its acquisition of Modular Space Holdings, Inc. for around $1.2 billion. With this acquisition, the company expanded its market reach and created an even stronger partner for its clients and vendors.

The Report Covers

• Market value data analysis of 2018 and forecast to 2025.
• Annualized market revenues ($ million) for each market segment.
• Country-wise analysis of major geographical regions.
• Key companies operating in the global modular construction market. Based on the availability of data, information related to projects, and relevant news is also available in the report.
• Analysis of business strategies by identifying the key market segments positioned for strong growth in the future.
• Analysis of market-entry and market expansion strategies.
• Competitive strategies by identifying ‘who-stands-where’ in the market.