17 Oct Prefabrication And Modular Construction Change How Structures Are Built
Prefabrication And Modular Construction Change How Structures Are Built
Modular construction typically involves constructing at least 60-90% of a building or other structure before bringing it to the construction site. Prefabrication, while technically part of modular construction, occurs when certain components of a structure are assembled or manufactured off-site.
The prefabricated parts are then easily affixed to the building.
The global modular construction market was worth about $91 billion as of 2022. And it is expected to grow to $120.4 billion by 2027.
And while it has been relatively small compared to the entire construction market, the modular construction industry has experienced rapid growth in the past few years.
McKinsey estimates that the North American permanent modular construction industry’s share of new construction projects rose by 51% between 2015 and 2018.
Over the same period, the industry’s total revenue more than doubled.
Increasingly, general contractors (GC’s), architects, and developers are finding that prefabrication and modular construction helps keep costs low, shortens the construction timeline, and reduces waste.
Because of this, roughly 90% of respondents to Dodge’s 2020 Prefabrication and Modular Construction Report said that prefabrication and modular construction methods were more beneficial than traditional construction.
Certain kinds of buildings do, however, lend themselves better to this kind of construction.
Dodge found that, overall, healthcare facilities are expected to benefit the most from modular construction and prefabrication over the next three years.
Hotels and motels, as well as multifamily residential structures, didn’t trail far behind though.
Between 2018 and 2020, hotels and motels have led the pack as major beneficiaries of modular construction.
According to Dodge, roughly 43% of architects and engineers and 29% of general contractors and construction managers said that hotels and motels were the fastest-growing industry for modular construction (2018-2020).
As the modular construction market grows, it is attracting new entrants.
One of the most promising new startups is Katerra.
It is focused on completely modularizing the construction process.
The company manufactures certain parts of a building (like a wall) in its facilities, allowing developers to assemble buildings on job sites.
For now, Katerra is focused mainly on the residential real estate market.
Katerra has raised $1.6 billion in funding, including $865 million from Softbank in 2018.
And although Katerra has had its recent problems, the company still generated about $2 billion in revenue in 2020.
Read more below:
https://explodingtopics.com/blog/construction-industry-trends