The global modular construction market is experiencing robust growth, driven by rapid urbanization, demand for affordable housing, and a focus on sustainability and efficiency. This method involves fabricating building components off-site in a controlled factory environment, then transporting and assembling them on-site, offering significant time and cost savings over traditional methods.
Chicago, Jan. 29, 2026 (GLOBE NEWSWIRE) — According to recent data from Astute Analytica, the global modular construction market was valued at US$ 90.3 billion in 2024 and is projected to hit the market valuation of US$ 155.2 billion by 2033 at a CAGR of 6.2% during the forecast period 2025–2033.
One of the most transformative trends reshaping the modular construction market is the industrialization of construction. This shift marks a departure from traditional building methods toward a “manufacturing-led” approach, where construction processes are integrated into controlled factory environments. By adopting principles akin to automotive manufacturing, companies are enhancing efficiency, precision, and sustainability in ways previously unattainable on conventional construction sites.
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Central to this manufacturing-led evolution is the incorporation of advanced technologies such as robotics and 3D printing. Firms like Mighty Buildings are pioneering the use of 3D printing to fabricate modular components with remarkable speed and accuracy. These innovations significantly reduce material waste and carbon footprints, addressing two of the most pressing environmental challenges in construction today. Robotics further streamlines assembly and quality control, creating seamless production lines that mirror those found in the automotive sector, driving productivity and consistency.
The AI Boom: Catalyst for New Infrastructure Demands
The rapid and exponential growth of Artificial Intelligence (AI) is reshaping not just the digital landscape but also creating an urgent demand for physical infrastructure. Traditional construction methods are struggling to keep up with the unprecedented need for server capacity, as tech giants require vast amounts of data processing power immediately, rather than years down the line.
In response to these pressures, the modular construction market is increasingly focusing on the supply of prefabricated data halls—fully engineered, factory-built environments designed to house server infrastructure. These prefabricated modules offer a streamlined, scalable approach that dramatically reduces construction lead times. Major operators are now procuring turnkey power and cooling modules that can be delivered and installed within 12 to 14 weeks, a timeline that conventional on-site construction simply cannot match.
Manufacturers specializing in these precision-engineered data halls are securing contracts valued in the hundreds of millions of dollars, reflecting the scale and strategic importance of this market segment. The complexity of these modular units, which integrate advanced power distribution, cooling systems, and structural requirements, demands a high level of engineering expertise. Companies that can deliver reliable, rapidly deployable solutions are gaining a significant competitive advantage in the race to support AI infrastructure.
Global “Net Zero” Mandates Driving Building Upgrades
The worldwide push toward achieving “Net Zero” carbon emissions is triggering a sweeping transformation in the building sector, necessitating massive upgrades to existing building stock. Rather than opting for costly and wasteful demolition, cities are increasingly embracing innovative retrofit solutions that align with sustainability goals. This shift reflects a pragmatic approach to reducing carbon footprints by enhancing the energy efficiency of the vast number of aging buildings already in place.
One of the most promising retrofit strategies gaining momentum is the use of panelized facade systems. These factory-built, insulated panels are designed to be installed quickly around existing buildings, providing enhanced thermal performance without the need for extensive demolition or disruption. This method not only preserves the structural integrity of buildings but also significantly improves their energy efficiency, contributing to carbon reduction targets in a cost-effective manner.
Originating in the Netherlands, the “Energiesprong” retrofit concept is rapidly gaining traction across North America. This innovative approach involves manufacturing highly insulated panels off-site and installing them on buildings—such as townhouses—in under one week. The speed and non-intrusive nature of these renovations make them highly attractive to homeowners, municipalities, and developers alike. By streamlining the upgrade process, Energiesprong is helping to overcome traditional barriers to large-scale energy retrofitting.
Residential Demand: The Driving Force Behind Modular Construction Growth
Residential demand dominates the modular construction market, accounting for a substantial 53.36% of overall activity. As countries grapple with urgent housing shortages, modular construction has emerged as a vital solution, offering rapid, off-site building methods that significantly accelerate project timelines. This shift toward factory-based production is reshaping how governments and developers address the growing need for affordable, high-quality housing across the globe.
In July 2024, the United Kingdom government set an ambitious target to construct 1.5 million new homes within five years—a goal widely recognized as achievable only through the widespread adoption of modular construction techniques. Traditional building methods simply cannot meet the speed and volume required to solve the housing crisis. Modular construction, with its ability to streamline production and reduce on-site disruption, offers the scalable, efficient approach necessary to meet these pressing demands.
Across the Atlantic, the United States is also experiencing strong growth in the multi-family residential modular segment, which was valued at US$ 7.1 billion in 2024. Developers are increasingly turning to modular construction as a means to accelerate project delivery and secure quicker returns on investment. The efficiency and predictability of modular builds reduce construction risk and enable faster occupancy, making it an attractive choice for residential developers seeking to address market demand swiftly and economically.
Europe’s Commanding Lead in Modular Construction
Europe currently stands as the dominant force in the modular construction market, commanding an impressive market share of over 41.66%. This leadership reflects the region’s advanced operational maturity, supportive regulatory environments, and strong demand for efficient, scalable building solutions. The European market’s momentum is driven by a combination of innovative construction techniques and substantial financial backing, positioning it at the forefront of the global modular construction landscape.
A prime example of Europe’s robust modular construction activity is seen in the United Kingdom, where manufacturers are securing significant financial resources to expand operations. In 2024, TopHat, a leading modular construction manufacturer, was granted an $88 million revolving credit facility designed to fuel its growth ambitions. This substantial financial commitment underscores the confidence investors have in the modular construction sector’s potential and signals continued expansion and innovation within the UK market.
Across the continent, major players are backing their financial muscle with tangible physical output. In Sweden, Lindbacks Group made headlines by securing a landmark deal to deliver 300 industrial timber apartments in Malmö, with completion slated for late 2024. This project exemplifies the scalability and sustainability of modular construction, utilizing timber as an eco-friendly material while meeting the rising demand for urban housing. Lindbacks’ success highlights the growing importance of industrialized building methods in addressing housing shortages and environmental concerns.
Top Companies in the Modular Construction Market
- Algeco
- ATCO
- Bouygues Construction
- Guerdon Modular Buildings
- Katerra
- KLEUSBERG GmbH & Co. KG
- Laing O’Rourke
- Lendlease Corporation
- Red Sea International Company
- Skanska AB
- VINCI Construction Grands Projets
- Other Prominent Players
Market Segmentation Overview
By Construction Type
- Permanent Modular Construction (PMC)
- Relocatable Modular Construction
By Material
- Steel
- Wood
- Concrete (Precast Concrete)
- Plastic
- Others
By Module Type (or Structure System):
- Four-sided Modules (Volumetric)
- Open-sided Modules
- Partially Open-sided Modules
- Mixed Modules & Floor Cassettes
- Modules Supported by a Primary Structure
By End-User Sector/Application
- Residential
-
- Single-Family Housing
-
- Multi-Family Housing (apartments, condominiums)
-
- Affordable/Low-Income Housing
-
- Student Housing
- Commercial
-
- Offices
-
- Retail Spaces
-
- Hospitality (hotels, motels)
-
- Restaurants and Cafeterias
- Industrial
-
- Warehouses and Distribution Centers
-
- Power & Energy Facilities
-
- Manufacturing Plants
- Institutional
-
- Schools & Colleges
-
- Healthcare (clinics, hospitals)
-
- Government Buildings
-
- Defense & Military
- Infrastructure/Utilities
-
- Public Restrooms
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- Toll Booths
-
- Utility Control Rooms
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- Modular Bridges & Tunnels
By Service Stage
- New Construction
- After-sales Maintenance and Refurbishment (Renovation)
By Region
- North America
- Europe
- Asia Pacific
- Middle East & Africa
- South America
For more information about this report visit: https://www.astuteanalytica.com/industry-report/modular-construction-market
About Astute Analytica
Astute Analytica is a global market research and advisory firm providing data-driven insights across industries such as technology, healthcare, chemicals, semiconductors, FMCG, and more. We publish multiple reports daily, equipping businesses with the intelligence they need to navigate market trends, emerging opportunities, competitive landscapes, and technological advancements.
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CONTACT: Contact Us: Astute Analytica Phone: +1-888 429 6757 (US Toll Free); +91-0120- 4483891 (Rest of the World) For Sales Enquiries: sales@astuteanalytica.com Website: https://www.astuteanalytica.com/
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