Growth opportunities in the global modular and prefabricated buildings market look robust over the next six years with technology set to play a significant role, says Prathmesh Limaye, Senior Research Analyst at Frost & Sullivan's Visionary Science Practice.
Our recent analysis, 'Global Modular and Prefabricated Buildings Market Forecast to 2025' explores the industrial, technology, regulatory, and growth factors and trends that have shaped the global modular and prefabricated buildings market landscape, the challenges that lie ahead, and the opportunities that can be tapped.
The research provides a detailed analysis of the growth opportunities for key players in this space. End industries analysed in this research include residential and non-residential construction with contractors, developers, and project owners classified as end users. At the subsegment level, the analysis focuses on the product types and materials these segments use in their products. Competitive structure and market share data have been provided at the top level.
A global uptick in construction activities and significant cost, labour, and time savings in offsite construction are key factors driving market revenues toward $215 billion by 2025. With a constantly evolving regulatory landscape, adopting more environmentally sustainable and regulatory-compliant construction practices will boost prospects and revenues in the more mature markets of Western Europe and North America. We expect the market to expand at a sturdy compound annual growth rate (CAGR) of 6.3% from 2018-2025.
Despite increased construction costs from an offsite construction, a net saving of up to 7% is possible because of shortened construction periods. In addition, prefabricated buildings are increasingly being perceived as sustainable solutions for construction projects due to a growing usage of materials, such as timber and aluminium composites, that are more energy efficient than concrete.
From a regional perspective, the recovering economies of Latin America along with high-growth markets of Eastern Europe, India, and Southeast Asia are expected to provide lucrative market opportunities. Slower growth is anticipated in North America and Europe due to increased construction activities in developing regions. From a competitor position, the market is highly fragmented with several regional and smaller suppliers with wide market coverage due to the relative ease of setting up a business in this space. The industry is, therefore, slated to experience consolidation with multiple merger and acquisition activities occurring in the foreseeable future. Many small and regional participants influence the overall pricing and distribution patterns in regional markets, especially in Latin America, the Middle-East, and Asia-Pacific. Additional growth opportunities participants should aim to secure include:
• Manufacturers promoting more cost-effective and environmentally sustainable solutions that are compliant with regulations mandated by international organisations.
• Gaining wider coverage by improving their portfolios with products that can be customised to end-user specifications and also promote ease of installation.
• Expanding operations into high growth regions such as Asia Pacific due to the region's growing infrastructure and construction development.
• Offering products that are comparative with those offered by regional and local manufacturers.
Despite significant market expansion prospects, perceptions surrounding the high initial cost of construction and transportation, design rigidity, multiple stakeholder involvement, and lack of skilled labour are key factors slowing adoption rates and hindering market growth.
Read more in the Offsite Magazine HERE