The construction industry is experiencing a significant transformation, driven mainly by the emergence of modular construction as an innovative approach. Modular construction has evolved from its modest beginnings to become a key player in the global construction sector, contributing to more efficient and environmentally friendly building solutions.

This detailed report thoroughly explores modular construction, including its versatile applications and global influence. With a specific emphasis on the United States and a worldwide perspective, we comprehensively analyze the industry’s reach, major contributors, environmental implications, and the hurdles it confronts.

Key Takeaways

  • The global modular construction market is valued at $84 billion in 2023 and is expected to reach $132 billion by 2030.
  • The US permanent modular construction industry generated $12 billion in revenue in 2022.
  • The global relocatable buildings market reached $51 billion in 2021 and is expected to grow to $103 billion by 2030.
  • The timeline for modular projects, from approval to occupancy, is 309 days.
  • The commercial segment of the US modular construction industry was valued at $12 billion in 2022.
  • In the US, 70% of all modular projects use wood-frame structures.
  • Modular construction reduces construction waste by up to 83.2%
  • 44% of all modular construction activity in California, Arizona, Nevada, and Utah was in the multifamily segment in 2020.
  • The European modular construction market is valued at $18 billion, with a potential growth to $27 billion by 2030.
  • 45% of housing stock in Finland, Norway, and Sweden was constructed using modular techniques.
  • 71% of general contractors and construction managers have adopted relocatable modular structures in their construction projects.
  • Modular construction can expedite project completion by 20% to 50%.


The modular construction industry has established a strong global presence and is rapidly expanding. It’s becoming a significant player in various sectors, including residential, commercial, education, and healthcare. Modular construction’s flexibility and efficiency make it a preferred choice for diverse construction needs, challenging traditional views of the construction process. As the industry continues to evolve and innovate, it’s set to leave a lasting impact on the construction landscape, offering sustainable and cost-effective solutions that meet the demands of our ever-changing world.

  • In 2023, the US modular construction market is valued at $32 billion, with a projected market value of $41 billion by 2028. This growth reflects a compound annual growth rate of 4.61% over the five-year period from 2023 to 2028. 
Graph of North American Modular Construction Market Size Growth Projection
Image Credit: Green Building Elements
  • In 2022, the global modular construction market was valued at $80 billion, which increased to $84 billion in 2023. The market is projected to further increase to $132 billion by 2030, exhibiting a compound annual growth rate of 6.5%. 
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Image Credit: Green Building Elements
  • In 2023, the Asia Pacific modular construction market is valued at $38 billion. Over the next seven years, it is anticipated to experience significant growth, reaching a market value of $61 billion by 2030. This growth represents a compound annual growth rate of 6.8%. 
  • From 2023 to 2030, the Middle East and Africa modular construction market is projected to experience a compound annual growth rate of 5.6%.
  • Before 2022, modular offsite construction accounted for approximately 2% of the global construction market. Currently, it is experiencing a yearly growth rate of 25%. 
  • In 2022, the global multifamily modular and prefabricated housing construction market had a valuation of $44 billion. It is expected to reach $48 billion in 2023, signifying a compound annual growth rate of 6.9%. 
  • By 2027, the global multifamily modular and prefabricated housing construction is expected to achieve a total value of $62 billion. This projection highlights a significant compound annual growth rate of 7.1%.
  • In 2022, the market value of the global single-family modular and prefabricated housing construction was $45 billion. Projections indicate a compound annual growth rate of 4.6% for 2023, leading to an anticipated total market value of $47 billion by that year.
  • In 2027, the global single-family modular and prefabricated housing market is projected to reach a market value of $57 billion, with a compound annual growth rate of 4.7%. 
  • In 2021, the global modular hospital buildings market had a value of $6.2 billion. It is projected to experience a compound annual growth rate of 5% and is expected to reach a value of $10.13 billion by 2031. 
  • In 2022, the global prefabricated buildings market size was valued at $134 billion. By 2028, it is expected to reach $211 billion showcasing a compound annual growth rate of 7.84%. 
  • In 2023, the modular construction for high-rise buildings market size was valued at $7 billion. By 2032, it is expected to grow at a compound annual growth rate of 5.60% to $11 billion. 
  • From 2023 to 2029, the portable classroom market is observed to be growing at a compound annual growth rate of 6.8%. By 2029, it is expected to reach a market value of $10 billion. 
  • By 2028, the global prefabricated housing market is anticipated to reach $29 billion, marking an increase from its 2023 valuation of $22 billion. This growth is indicative of a compound annual growth rate of 6.2%.
  • From 2023 to 2028, the Latin American prefabricated wood buildings market is expected to grow robustly with a compound annual growth rate exceeding 5%. 

National Insights

The United States is leading a construction revolution, with modular construction leading the way in changing how we design and build structures. In response to the increasing need for sustainable, cost-effective, and quickly deployable buildings, modular construction has gained significant popularity across the country. This represents a significant transformation in the construction industry, offering innovative solutions that fit well with the changing demands of our dynamic world.

  • In the US commercial modular industry, there are approximately 255 modular manufacturing companies actively generating revenue in 2022. 
  • In 2022, 24 modular manufacturers collectively produced a total of 8.1 million square feet of modular constructions. The average production per manufacturer was 340,000 square feet. 
  • In 2022, modular construction projects accounted for 6.14% of the total square footage allocated for new construction. 
  • In 2022, the average project size for completed modular constructions stood at 24,057 square feet. The typical number of modules incorporated per modular project in 2022 was 37. 
  • On average, from the point of project approval to occupancy, the timeline for modular projects stands at just 309 days. The average total cost for these projects amounts to $7 million. When considering the cost per square foot, the figure comes to $279. 
  • In 2022, the residential segment held the largest market share, accounting for 52.7% of the total market. This segment is projected to maintain its leading position and experience the fastest growth among all segments by 2030. 
  • In 2022, the commercial segment exhibited a total valuation of $12 billion. Projections indicate that the segment is expected to achieve significant growth, with a forecasted revenue milestone of $21 billion by the year 2030. 
  • In 2022, the modular multifamily market held a market share of 32%, representing a notable rise from its market share of 24% in 2021 and 21% in 2020. 
pie chart of distribution of modular construction by type
Image Credit: Green Building Elements
  • In the historical context of modular construction in the United States, wood-frame structures have been used in approximately 70% of projects. Steel structures have been utilized in about 25% of projects, while concrete modules have accounted for roughly 5% of the total. 
  • In 2022, the modular construction industry captured a 6% share of new construction starts in North America, yielding a collective revenue of $1.9 billion. On average, individual manufacturers within this industry generated $20 million in revenue during the same year. 
  • In 2022, the proportion of modular construction costs relative to the total construction project cost was 43%, marking a substantial reduction compared to earlier years, where modular costs typically constituted 80% to 90% of the total project value. 
  • In 2020, 60 modular manufacturers collectively managed and completed new construction projects with a total value of $2 billion. 

Regional Analysis

Modular construction in the United States varies from region to region, reflecting a diverse and dynamic market. In some areas, it has been enthusiastically embraced as a creative solution to address urbanization and housing challenges. Its capacity to quickly provide high-quality buildings aligns well with the need for fast development in these regions. Conversely, in other areas, the full potential of modular construction has not yet been fully explored.

  • In 2020, construction activity in key modular markets in the Virginia, West Virginia, Pennsylvania, Maryland, District of Columbia, Delaware, and New Jersey regions decreased from $35 billion in 2019 to $26 billion. Projections indicate a market recovery, with the value anticipated to increase to $29 billion in the near future. 
  • In 2020, the multifamily segment in these states experienced a decrease to $7 billion. However, it is projected to recover and reach an estimated value of $8 billion in 2023, indicating a notable improvement from its 2020 low. 
  • In 2020, construction activity in key modular markets in the Northeastern region (Maine, Vermont, New Hampshire, Massachusetts, Connecticut, Rhode Island, and New York) decreased from $40 billion in 2019 to $26 billion. 
  • In the same regions, the multifamily market experienced an initial decrease to $8 billion, followed by an anticipated recovery to $10 billion. 
  • In 2021, the multifamily market in New York reached a value of $6 billion. 
  • In 2020, the total value of construction starts in seven states (Florida, Georgia, Alabama, Mississippi, North Carolina, South Carolina, and Tennessee) decreased from $56 billion in 2019 to $40 billion, representing a 28.57% decline. 
  • In 2020, multifamily construction projects constituted a substantial proportion of the total construction activity in these states, with a value of $17 billion, approximately 50% of all construction projects conducted during that year. 
  • In 2020, the total modular construction expenditure in the education sector in the regions of Louisiana, Texas, Arkansas, New Mexico, and Oklahoma amounted to $6 billion, accounting for approximately 28.6% of the total construction expenditure, which stood at $21 billion. Projections indicate that in 2021, this sector is expected to exceed $9 billion in expenditure. 
  • In 2020, the coned construction value in key modular markets across the states of Ohio, Kentucky, Indiana, Michigan, Illinois, Wisconsin, Minnesota, Iowa, and Missouri amounted to $30 billion, reflecting a decrease from the $36 billion reported in 2019. 
  • In 2020, the multifamily market in these states recorded a coned total of $10 billion in activity. 
  • In 2020, Wisconsin recorded $2 billion in multifamily project construction starts, the highest among all states. 
  • In 2020, 44% of modular construction activity in the states of California, Arizona, Nevada, and Utah belonged to the multifamily segment. 
  • In 2019, modular construction activity in key markets across Oregon, Washington, Idaho, Alaska, and Hawaii was valued at $14 billion, which decreased to $10 billion in 2020, signifying a significant downturn in the industry’s financial performance during that period. 
  • In the specified regions, data from 2020 reveals that multifamily housing construction represented 49% of total construction activity, with an anticipated expansion in 2021. 
  • In 2019, 45% of modular construction production in the educational sector was centralized in six states: California, Georgia, New York, North Carolina, Texas, and South Carolina. 

Market Penetration

Modular construction provides a wide range of flexible solutions that cater to various industries. It covers residential housing, effectively meeting the growing demand for affordable and sustainable homes. In the context of residential construction, modular techniques promise cost-effective, eco-friendly, and quickly deployable housing solutions.

In the business world, modular construction changes the pace and efficiency of expansion. Whether it’s used for offices, retail spaces, churches or industrial facilities, modular structures allow companies to adapt and grow swiftly. The streamlined construction of commercial spaces through modular methods can reduce downtime and disruptions, ultimately benefiting businesses and improving their financial performance.

  • In 2020, modular manufacturers allocated 25.8% of their total production to the office and administrative market, indicating the substantial market share held by this sector within the industry.
  • In 2020, 21% of industry production was attributed to the multifamily housing sector, representing a substantial increase from 7% in 2019. This growth can be primarily attributed to two factors: the rising housing crisis and the demonstrated efficiency of modular construction methods as a viable solution to address the urgent need for affordable housing.
  • In 2022, multifamily housing constituted 32.3% of all constructed modules. The office/administrative sector accounted for 19.1%, while the institutional/assembly sector represented 17.5% of the market. Education, workforce housing, healthcare, and commercial/retail sectors held shares of 15.6%, 5.4%, 5.3%, and 4.8%, respectively. 
  • In 2021, the commercial segment accounted for 31.6% of the market share and generated $44 billion in revenue. 
  • Modular construction constituted a substantial factor in multifamily housing projects during the period from 2019 to 2020, contributing an average cost of $5 million, which equated to roughly 37% of the total average project expenditure of $14 million. 
  • In 2019, modular construction’s market share in the retail industry stood at 1% of total production, equating to an annual output ranging from 150 to 250 modules. These figures indicate a relatively low level of adoption, signifying that modular construction has not achieved significant penetration in the retail sector. 
  • In 2019 and 2020, retail modular projects had an average completion time of 179 days from start to finish. The average total cost for these projects was approximately $770,000, with modular components accounting for approximately 38% of the total expenses. 
  • In the period spanning 2019 to 2020, projects within the hospitality sector, on average, displayed a size of $23 million. Notably, modular construction contributed around $7 million to the overall project cost, equating to approximately 30% of the total project expenditure. This translates to an average cost of roughly $326 per square foot.
  • Modular construction is projected to potentially contribute up to $130 billion to the USA and European real estate construction markets by 2030, contingent upon moderate adoption levels, reflecting its significant market potential. 

Notable Buildings Companies and Manufacturers in the USA

In the North American modular construction market, several influential industry leaders have been instrumental in driving its expansion. This section aims to highlight these key suppliers and delve into their financial performance to emphasize their dominant positions in specific segments of the modular construction industry.

  • Corrugated Metals, Inc. is a significant player in the US modular construction industry, with an annual revenue of $63 million. The company specializes in the fabrication of pre-engineered, rack-supported, and modular structures, employing a variety of materials including aluminum, steel, copper, and brass to address a wide array of construction needs.  
  • Easi-Set Buildings operates within the US modular construction industry, with an annual revenue of $50 million. The company specializes in the production of modular buildings and shelters utilizing precast concrete materials. These structures are designed for various applications across sectors such as storage, pump stations, utilities, telecommunications, data centers, restrooms, concessions, and HazMat buildings.  
  • Panel Built, Inc. is a manufacturer specializing in modular buildings and steel mezzanines, with an annual revenue of $25 million. The company’s core competency is in the production of modular and warehouse offices, serving the requirements of businesses in diverse industries. 
  • Flexospan Steel Buildings, Inc. is a veteran and woman-owned small business enterprise with a notable presence in the metal construction industry, reporting an annual revenue of $25 million. The company specializes in providing metal roofing, siding, and frames to meet the requirements of a wide range of construction projects. 
  • CID Associates, Inc. is a manufacturing company specializing in custom structures, with an annual revenue of $16 million. The company’s specialization encompasses the creation of personalized structures to serve various industries, such as commercial, industrial, pharmaceutical, government, petrochemical, and offshore platform oil rigs. 

Global Key Players and Insights

Modular construction is a global game-changer, offering efficiency, sustainability, and adaptability. It cuts construction timelines and costs, reduces waste, and lessens environmental impact. It addresses housing shortages and climate change, reshaping urban landscapes. As it gains global influence, it ushers in an era of innovative, eco-friendly building solutions that redefine architecture’s impact on the world.

  • Skanska AB, a Swedish multinational construction and development company, reported an annual revenue of $15 billion. The company is known for its focus on sustainability and technological innovation and operates in three primary segments: construction, residential development, and commercial property development. 
  • SEKISUI CHEMICAL CO., LTD., a Japanese manufacturer, reports an annual revenue of $9 billion and maintains a diversified portfolio across multiple sectors. Within the construction industry, the company is known for its innovative approach to modular construction, employing factory-based production methods to create steel-framed and wooden modular housing units.
  • In 2022, Balfour Beatty, a prominent UK-based construction contractor, reported revenue of $8.9 billion. The company specializes in construction services, support services, and infrastructure investments, establishing itself as a significant player in the UK construction industry. 
  • In 2022, ATCO Ltd., a Canadian conglomerate, reported earnings of $423 million. One of its subsidiaries, ATCO Structures, is a global leader in modular design, manufacturing, and construction across various sectors, such as workforce accommodations, offices, classrooms, hospitals, and hotels. 
  • The European modular construction market is set for significant expansion, with projections anticipating a surge from $18 billion in 2023 to $27 billion by 2030. This represents a remarkable compound annual growth rate of 5.8%. 
bar graph of European modular construction market forecast 2023-2030
Image Credit: Green Building Elements
  • India’s prefabricated buildings market stands at an estimated $2 billion. It is poised for significant growth, with an anticipated compound annual growth rate of 13%, projecting the market to reach a value of $4 billion by 2028.  
  • Singapore has committed to investing $3 billion in sustainable infrastructure and housing and plans to issue $25 billion in green bonds by 2030. This investment is anticipated to drive growth in the regional modular construction market, primarily attributed to its cost-effectiveness and environmental advantages. 
  • In 2022, Bouygues S.A., a prominent French conglomerate, reported an annual revenue of $44 billion. The company is involved in various sectors, including construction through Colas Group and Bouygues Construction, real estate development via Bouygues Immobilier, media with TF1 Group, and telecommunications through Bouygues Telecom. Bouygues
  • In Nordic countries, modular construction has been widely adopted, accounting for approximately 45% of the housing stock in Finland, Norway, and Sweden. This prevalence of modular construction in the region can be attributed to its perceived benefits, such as decreased construction duration, enhanced quality control, and increased sustainability. 
  • A notable 15% of homes in Japan are constructed using modular construction methods. 
  • The prefabricated housing market in Africa holds a significant value of $4.8 billion in 2023. 

Market Perception

Contractors’ adoption of modular construction varies, driven by their perspectives on its advantages and challenges. Some enthusiastically embrace it for speed, cost-efficiency, and sustainability, aligning with their vision of efficient and sustainable practices. Others exercise caution due to potential constraints and unfamiliar procedures. This diversity reflects an ongoing dialogue and evolution in the construction industry, as professionals balance innovation with tradition in shaping the future of construction.

  • 88% of general contractors and construction managers noted improved schedule performance from modular construction in the past three years. Trade contractors saw a lower 36% improvement in the same period. 
  • 91% of general contractors and construction managers saw cost benefits with modular construction, with over 48% achieving a budget improvement exceeding 10%. In contrast, architects/engineers and trade contractors had lower rates of success, with only 47% and 46% experiencing positive cost outcomes. 
bar chart of impact of prefabrication on project budget performance
Image Credit: Green Building Elements
  • Over the past three years, 92% of architects and engineers, 90% of general contractors, and construction managers, and 88% of trade contractors have reported significant improvements in building quality with modular construction. Among architects and engineers, 16% reported a “very high” improvement in building quality.  
bar chart of GC/CMs impact of modular construction on key performance factors
Image Credit: Green Building Elements
  • 99% of general contractors and construction managers highlighted the significant impact of modular construction on building productivity, with 27% noting exceptionally high improvements. Architects, engineers, and trade contractors also reported substantial gains, with 89% in each group acknowledging remarkable productivity improvements.  
  • 92% of general contractors and construction managers reported that modular construction had a significant positive impact on project schedules, with 17% describing the improvement as ‘very high.’ Additionally, architects and engineers (91%) and trade contractors (85%) acknowledged the favorable influence on project schedules. 
  • 88% of general contractors and construction managers report a reduction in waste through modular construction, with 27% noting a ‘very high’ reduction. Additionally, 85% of architects, engineers, and trade contractors acknowledge the positive impact of modular construction on waste reduction. 


In the modular construction industry, two pioneering approaches offer distinct advantages. Permanent Modular Construction (PMC) is known for its sustainability and efficiency, ideal for enduring structures. In contrast, Relocatable Buildings prioritize adaptability and mobility, making them well-suited for quickly changing needs in fields like education and healthcare. Both PMC and Relocatable Buildings showcase the diverse applications of modular construction, with one focusing on longevity and sustainability, and the other on versatility and adaptability.

  • In 2022, the permanent modular construction industry in the USA generated $12 billion in revenue, accounting for approximately 6.03% of the total value of new construction projects for that year.
  • The global permanent modular construction industry exhibited a growth from $87 billion in 2021 to an anticipated $148 billion by 2030, driven by a compound annual growth rate of 7%. This growth is attributed to the rising adoption of modular construction methods across multiple sectors.
  • In 2022, permanent modular construction accounted for 70.6% of the total revenue within the modular construction market, indicating its significant market share. It is anticipated that this dominance will persist, with permanent modular construction projected to maintain the highest compound annual growth rate among all modular construction segments in the foreseeable future. 
  • The global relocatable buildings market is projected to experience a growth in market size, increasing from $51 billion in 2021 to an estimated $103 billion by 2030. This growth is primarily attributed to a compound annual growth rate of 8%, indicating a rising demand for adaptable and economically efficient building solutions. 
  • Portable office buildings in the modular construction industry are projected to grow from $6 billion in 2021 to $9 billion by 2028, driven by a 4.6% compound annual growth rate.
  • Modular office projects exhibited an average total cost of approximately $870,000 in 2019 and 2020, with the modular component accounting for a substantial $600,400. This reflects a significant 69% share of the overall project cost. 

Materials and Application

Materials play a crucial role in modular construction, influencing the innovation and efficiency of the final product. Steel and concrete provide strength and durability, while advanced composites offer flexibility for versatile designs. Choosing the right materials is essential, as it affects the structural strength, appearance, and functionality to meet the specific requirements of various projects, from sustainable housing and healthcare facilities to modern commercial spaces.

  • Steel commanded the largest share of the market in 2021, holding a remarkable 26.8% share and generating substantial market revenue of $37 billion.  
  • The wood material segment is poised for substantial growth within the modular construction industry, with an impressive projected compound annual growth rate of 7.4% between 2023 and 2030. 
  • In panelized modular construction, 92% of architects and engineers, 87% of general contractors, and 82% of trade contractors prefer utilizing wall modules. 
  • 3D modules for onsite assembly have rapidly gained popularity over the past three years, with 87% of general contractors and construction managers, 86% of trade contractors, and 81% of architects and engineers using them. 
  • Trade contractors are set to significantly increase their adoption of factory-made turnkey modular building units, with a remarkable 31% anticipating a substantial expansion in their use of these units over the next three years. This substantial growth is expected to drive the integration of modular building units into at least 25% of their projects. 
  • General contractors and construction managers lead in adopting relocatable modular structures, with 71% currently using them and 79% planning to do so in the next three years. Trade contractors have lower involvement, with a 61% current usage rate. 
  • In the next three years, 85% of architects and engineers plan to expand their use of panelized modular construction, building on the existing trend where 84% have already adopted it in the past three years. 


Modular construction is a cost-effective and efficient choice for a variety of projects. It saves time and money by shortening construction schedules and simplifying processes, making it a popular option for many endeavors.

Additionally, modular construction is environmentally friendly, promoting sustainability and reducing waste. It ensures quality and safety through strict factory-controlled processes, resulting in reliable and secure final products. Its flexibility allows for customization across different building types, making it a significant innovation in the construction industry.

  • Modular construction can expedite project timelines by a notable margin ranging from 20% to 50%. This substantial time savings stems from the prefabricated nature of modular construction, where building components are manufactured in a controlled factory setting and then assembled on-site, reducing the overall construction process. 
on-site vs modular construction timelines
Image Credit: Green Building Elements
  • Modular construction offers a 20% cost reduction compared to traditional methods by streamlining production, minimizing material waste, requiring less labor, and shortening project timelines. 
  • Projected annual savings in the US and European modular housing markets by 2030 is valued at $22 billion. This cost reduction is primarily a result of advanced materials, digital technology integration, and streamlined logistics, leading to enhanced durability, reduced material waste, optimized design and manufacturing productivity, and minimized transportation costs and delays. 
  • In 2021, construction sites accounted for 46.2% of workplace fatalities, with one in every five workplace deaths occurring on these sites. Modular construction, which entails the assembly of prefabricated units in controlled facilities, presents a safer alternative with the potential to reduce accidents on construction sites by up to 80%. 
  • 66% of building professionals perceive modular construction as a substantial time-saving advantage, with 35% reporting project timeline reductions of four weeks or more. 
bar chart of impact of prefabrication on project schedule performance

Environmental Impact

Modular construction is more than just speed and efficiency; it’s a transformative sustainability solution. In an era where the construction industry significantly impacts global carbon emissions, modular construction offers an environmentally conscious alternative. It optimizes materials, minimizes waste, and reduces energy consumption, significantly lowering its environmental footprint. This approach not only streamlines construction but also encourages responsible resource management.

Furthermore, modular construction fosters innovative sustainability practices by promoting energy-efficient designs, eco-friendly materials, and on-site renewable energy integration. It sets a new standard for eco-conscious construction, reducing the industry’s ecological impact and advancing sustainability in the built environment.

  • Modular construction has demonstrated the potential to decrease waste by approximately 83.2%. This aligns with worldwide statistics indicating that construction contributes to 25% of solid waste generation, with construction materials constituting 40% of landfill content. Notably, within the United States, construction waste volume is twice that of municipal solid waste, underscoring the environmental advantages associated with modular construction. 
  • Volumetric modular building production offers several key advantages, including a 67% reduction in energy consumption, a 50% decrease in on-site construction time, and a 90% reduction in construction site vehicular movement. These benefits are attributed to the prefabrication process conducted in a controlled factory environment, which minimizes waste, expedites project completion, and significantly reduces the environmental impact. 
  • The adoption of modular construction in Pakistan results in a substantial environmental advantage, manifesting as an approximate 50% decrease in greenhouse gas emissions in contrast to traditional on-site construction practices.
  • The increased utilization of wood as the primary building material in modular construction can potentially lead to a reduction in carbon emissions by approximately 69%, contributing to the achievement of emission reduction targets by 2030. Wood’s capacity for carbon sequestration and its renewable nature position it as a more sustainable option compared to concrete and steel in urban construction. 
  • Modular construction methods have been shown to result in a reduction in greenhouse gas emissions, with potential emission reductions in California ranging from 2% to 22% when compared to traditional construction methods. 
  • Modular projects, with shorter durations and fewer on-site workers, save energy by reducing transportation, worker accommodations, and lighting demands. A facility with just 100 workers per shift can build 1 to 1.15 million square feet per year, with advanced technology boosting productivity. This energy-efficient construction method is more sustainable than traditional ones.
  • Modular construction offers a substantial advantage by enabling easy adaptation, modification, and disassembly for reuse or recycling. This flexibility can lead to a significant 47.9% reduction in waste costs for large structures, enhancing sustainability and reusability. 


Modular construction presents numerous advantages, including efficiency, cost-effectiveness, and sustainability, but it also poses significant challenges. Regulatory compliance is a primary concern, with the need to navigate complex regional and national building codes. Balancing standardization and customization in design is another crucial consideration.

For large-scale modular projects, transportation logistics and on-site assembly coordination are paramount, requiring meticulous planning. Overcoming misconceptions and skepticism is also vital, emphasizing the need for robust education and awareness initiatives to highlight the benefits of this innovative construction approach and dispel doubts about its viability and quality.

  • The cost of transporting modular components over long distances and to sites with limited access typically falls within a range of $5,000 to $15,000. These costs may exhibit variations based on factors such as truck availability and location. 
  • Modular construction typically involves 60% to 90% of the building process taking place in a factory, necessitating substantial upfront investments in design and engineering. Modular homes, upon leaving the factory, tend to be 85% to 95% complete, which limits the feasibility of making significant or cosmetic changes at later stages. As a result, early decisions regarding finishes and appliances become essential, in contrast to traditional construction, which allows for revisions at later points in the construction process.  
  • Modular construction presents a potential cost savings of up to 20%. However, it carries a risk of a 10% cost increase if labor savings surpass logistics or material costs. Initial design expenses for modular projects tend to be higher than those of traditional construction methods, and design challenges can result in cost escalation. 
  • Securing a suitable site for modular construction typically requires 2 to 4 weeks of preparation and incurs a cost ranging from $15,000 to $40,000. It is recommended to prioritize the acquisition of a location that can readily accommodate prefabricated modules during the initial planning phases of a modular construction project.

Frequently Asked Questions

What is the market size of the modular construction industry in the United States?

The United States modular construction industry has a market size of $32 billion in 2023, which is expected to grow to $41 billion by 2028. This represents a 4.61% compound annual growth rate from 2023 to 2028.

How big is the global multifamily modular and prefabricated housing?

The value of the global multifamily modular and prefabricated housing market is anticipated to reach $48 billion in 2023. This projection showcases an increase of $4 billion from its value of $44 billion in 2022.

How many modular manufacturing companies are there in the USA?

In the commercial modular industry, it is estimated that there are 255 modular manufacturing companies active.

What is the average turnaround time for a modular construction project?

On average, the timeline for modular projects comes out to just 309 days from project approval to occupancy.

Which sector in the modular construction industry is the fastest growing?

The fastest growing sector in the modular construction industry is the multifamily housing sector, growing from 7% in 2019 to 21% in 2020.

Which countries use modular construction the most?

Modular construction has gained significant adoption in the Nordic countries of Finland, Norway, and Sweden, with an impressive 45% of housing stock built using modular techniques. Japan and the United States are other countries that have adopted modular construction, with adoption rates of 15% and 4%, respectively.

Does modular construction reduce construction costs?

Modular construction offers a 20% cost reduction compared to traditional construction methods. 91% of general contractors and construction managers have observed cost benefits with modular construction, with over 48% achieving a budget improvement exceeding 10%.

Can modular construction methods reduce construction accidents?

Modular construction methods can potentially reduce accidents by up to 80%.

Is modular construction more efficient when it comes to energy savings?

Modular projects require shorter durations and fewer on-site workers. A facility with 100 workers per shift can build 1 million to 1.15 million square feet per year.

How expensive is it to transport modular components?

Modular components transported over long distances and to sites with limited access can be costly, ranging from $5000 to $15,000. These costs can change depending on other factors such as the availability of trucks and the location of the site.