US Modular Construction Market by Application, and Type - Forecast and Analysis 2023-2027

US Modular Construction Market Forecast 2023- 2027

US modular construction market size is forecast to reach USD 23.62 billion at a CAGR of 5.61% from 2022 and 2027. The growth of the market depends on several factors such as rising construction and infrastructure development activities, improving aesthetics look, quality and energy efficiency, and on-site constraints. Additionally, the market is witnessing a shift towards innovative building methods like off-site building and modular construction, driven by factors such as cost efficiency, speed of installation, and sustainability. These methods utilize materials like timber, which offer advantages such as durability, lightweightness, and low toxicity.

What will be the Size of the Modular Construction Market in US During the Forecast Period?

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Market Segmentation by Application, Type, Geography 

The growth of the residential segment will be significant during the forecast period. The residential segment was the largest segment of the market in US in 2022. According to the World Bank, US population growth increased by 0.1% in 2021 compared to 2020. Increased urbanization has increased the demand for new residential units. In addition, new residential construction projects are expected to drive segment growth over the forecast period.

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The residential segment was valued at USD 8,963.95 million in 2017 and continued to grow until 2021. Apart from that, benefits such as time savings and quick return on investment are the main benefits of building. The modular design allows industrialized assembly at the same time as site preparation, thus significantly reducing the total time required to build the structure. They can be used to easily manufacture turnkey homes that meet local and suburban, state, and federal building codes.

Type Analysis

The type segment includes permanent and relocatable. The buildings is transforming the sector into highly efficient and environmentally friendly ways to build structures that are more durable, stronger, and more predictable. A sustainable and cutting-edge technology called Permanent Modular Construction (PMC) prefabricates single or multi-storey homes with components using lean manufacturing techniques and off-site manufacturing. PMC enables faster service, saving costs and time. Permanent structures are constructed using off-site construction methods for residential and non-residential homes and prefabricated parts of building elements. PMC enables faster design at a lower cost. It is mainly used in the hotels, schools, and restaurants.

Technavio’s Exclusive Market Customer Landscape

Our analysis of the adoption life cycle of the market indicates its movement between the innovator’s stage and the laggard’s stage. The report illustrates the lifecycle of the market, focusing on the adoption rates of the major countries. Technavio has included key purchase criteria, adoption rates, adoption lifecycles, and drivers of price sensitivity to help companies evaluate and develop growth strategies from 2022 to 2027. 

Global market Customer Landscape

Market Dynamics

As the construction industry embraces off-site building methods, it is expected to grow rapid building , offering advantages over traditional building methods in terms of quality, efficiency, and sustainability. Governments and international organizations are promoting off-site building through initiatives that encourage the use of alternative building methods and support disaster relief efforts with relocatable and refabricated homes. Our researchers studied the data for years, with 2022 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.    

Market Driver

 

Buildings constructed in the twentieth century typically utilized low-quality materials and lacked many features present in conventionally built homes. Consequently, they were predominantly utilized by individuals of lower economic means. However, the enhanced build quality, rigorous design and inspection processes, and the availability of extensive customization options now draw numerous homebuyers towards modular construction. Currently, structures employing modular construction techniques are manufactured within tightly controlled environments, emphasizing quality and design standards.

This approach helps alleviate common issues encountered during the construction of traditionally built homes. Many modern modular-constructed buildings are considered superior to conventional homes in numerous aspects. Most adhere to either the US Housing and Urban Development (HUD) Code or the International Residential Code (IRC), ensuring safety and durability. The advancements in the quality and efficiency of prefabricated buildings are altering consumer perceptions of prefabricated construction, prompting many to opt for prefabricated buildings over traditional brick-and-mortar structures. Such factors are expected to drive up the demand , subsequently boosting the growth of the market in the US during the forecast period.

Market Trends

Modular construction offers contractors flexibility and is environmentally friendly, as key construction components are reusable and can be relocated without the need for new resources. The growing awareness of the advantages in custom facility construction is projected to drive the expansion of the modular construction market in the US over the forecast period. The promising growth prospects of the market in the US are prompting vendors to engage in strategic partnerships and acquisitions to broaden their customer base and market presence. Consequently, market players are executing acquisition strategies. For instance, in February 2023, McGRATH RENTCORP acquired Vesta , facilitating its business expansion in the country. Similarly, in January 2023, ATCO Ltd. acquired Triple M Housing, thereby enhancing its global modular operations. Thus, the increasing frequency of acquisitions in the market is anticipated to accelerate the growth of the market in the US during the forecast period.

Market Challenge

The complicated approval process is a major challenge for market growth. The approval process for it building is a lengthy process. All projects, regardless of how they are constructed, must comply with applicable local, state, and federal laws and regulations. The production is more advantageous in some state and local jurisdictions than others. In an ideal world, only connections and field work would be subject to local government inspections, and modules would be subject to state regulations (such as the Pennsylvania Industrialized Housing Act).

Moreover, the approval and implementation phases might be made more difficult in areas where there is a significant union influence. Such complicated approval processes will impede the growth of the market in US during the forecast period.

Who are the Major Modular Construction Market Companies in US?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Lendlease Corp. Ltd. The company offers Engineering, Procurement, and Construction Management services. Also, the company offers urbanization, residential and retirement communities, and infrastructure development.

McGRATH RENTCORP. The company offers Campus Maker Hybrid, Campus Maker ModPod, Eco II Xpand Two Story Modular Classroom, Complexes, Mobile Offices, and Restrooms. Also, the company offers rents and sells electronic test equipment nationally and internationally from two facilities located on the grounds of the Dallas Fort Worth International Airport in Grapevine, Texas, and Dollard des Ormeaux, Canada.

We also have detailed analyses of the market’s competitive landscape and offer information on 15 market vendors, including:

• Abtech Inc.
• ATCO Ltd.
• Bechtel Corp.
• Black Diamond Group Ltd.
• Building Pro
• Commercial Structures Corp.
• Fluor Corp.
• GUERDON LLC
• JL Construction
• Kwikspace Pty Ltd.
• Modular Genius
• Nadler Modular
• Pac Van Inc.
• Satellite Shelters Inc.
• Skanska AB

Technavio report provides an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies vendors into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Vendors are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.  

Segment Overview

The market research report forecasts market growth by revenue and provides an analysis of the market growth and trends opportunities from 2017 to 2027. 

• Application Outlook (USD Million, 2017 - 2027)
  • Residential
  • Commercial

• Type Outlook (USD Million, 2017 - 2027)
  • Permanent
  • Relocatable

Market Analyst Overview

Hurricanes, floods, wildfires, and earthquakes have underscored the need for resilient and adaptable construction solutions, leading to a surge in demand. Offering both permanent construction and relocatable or portable buildings, the market for relocatable modular construction (RMC) is rapidly expanding. Off-site building activities include the fabrication of timber modular homes, multi-story wood homes, and modular concrete structures. These structures offer seismic resistance, fast installation, and ease of fabrication, making them ideal for challenging designs and customizable homes.

The U.S. construction industry is transforming, leveraging innovations in structural steel and building materials like H-type beams, I-beams, and T-shaped structures. Embracing mechanical and chemical properties enhancements, it's shifting towards timber modular building and biodegradability  of materials for sustainability. Prefabricated construction methods and digital software streamline processes, mitigating on-site assembly errors. Addressing challenges like natural disasters, it prioritizes reconstruction and employs relocatable modular construction for temporary housing. With a focus on economic expansion and environmental protection, the industry ensures controlled manufacturing facilities and modular construction processes meet international and local building codes, fostering innovation while guaranteeing safety and sustainability.

In addition to residential applications, off-site buildings is gaining traction in industries like healthcare, where timber modular homes are used to create quiet, safe, and hygienic medical facilities. Hospitals and healthcare organizations benefit from reduced labor costs, material wastage, and construction time, while patients enjoy high-quality facilities designed for their specific needs. The off-site building industry is supported by advancements in digital technologies, such as computer-aided design (CAD) and building information modeling (BIM), which improve design capabilities, quality control, and manufacturing processes. These technologies also enhance the planning, designing, fabrication, transportation, and assembling of off-site building components. Mechanical properties such as ductility, recyclability, and reusability make an attractive option for various projects, including prefabricated buildings and residential but lacking skilled labor shortage.

Modular Construction Market Scope in US
Report Coverage	Details
Page number	122
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 5.61%
Market growth 2023-2027	USD 5,641.62 million
Market structure	Fragmented
YoY growth 2022-2023(%)	5.51
Competitive landscape	Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks
Key companies profiled	Abtech Inc., ATCO Ltd., Bechtel Corp., Black Diamond Group Ltd., Building Pro, Commercial Structures Corp., Fluor Corp., GUERDON LLC, JL Construction, Kwikspace Pty Ltd., Lendlease Corp. Ltd., McGRATH RENTCORP, Modular Genius, Nadler Modular, Pac Van Inc., Satellite Shelters Inc., Skanska AB, Specialty Modular, STARRCO, and Westchester Modular Homes
Market dynamics	Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period.
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in the Market Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the market growth and forecasting of the market between 2023 and 2027
• Precise estimation of the size of the market size and its contribution to the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Growth of the market industry across Europe, North America, APAC, South America, and Middle East and Africa
• Thorough market growth analysis of the market’s competitive landscape and detailed information about companies
• Comprehensive market analysis and report on the factors that will challenge the market research and growth of market companies

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