With a range of economic forecasts currently in the public realm, the post-lockdown world remains deeply impacted by Covid-19. AMA Research has concluded that there are several construction sectors that are likely to see an upturn as lockdown continues to ease. And according to their Covid-19 insights, the outlook for modular is bright.
Volumetric on the rise
Having shaken off its poor image, prefabricated volumetric building is currently estimated to account for up to 45% of total market by value at MSP. The largest market is temporary on-site accommodation which amounts to £350m-£380m annually. Delivering ready to go structures in the age of social distancing is clearly a benefit. And with sectors such as health and retail experiencing increased if short term demand for increased customer capacity, the handy prefab is in demand.
Thanks to the inclusion of modular developers in several key public sector procurement frameworks and the increasing use of BIM technology, the market sector is estimated to grow 14% over the next 4 years.
Jobs in modular construction are also expected to deal with the traditional skills gap in the construction industry, while volumetric methods are a critical factor in plans to address the UK's housing shortage. The housing sector is predicted to account for 12-14% of market value by 2024, underpinning steady growth in the modular construction sector.
Housing constructed offsite and then craned into position on pre-existing groundworks has long been touted as a magic bullet for the housing crisis. The shortage of good quality, affordable and sustainable homes will continue to drive demand coupled with ambitious net-zero carbon targets.
Where traditional methods of construction ground to a halt as lockdown hit, the modular construction sector was able to build as usual while obeying strict social distancing guidelines that were almost impossible to implement on-site.
Yet another factor is the declining numbers of skilled professionals and tradespeople and jobs in modular construction have already been proven to diversify the workforce, bringing in underrepresented demographics including women and young people and changing the image of the industry from hard hats and hi-vis to clean, secure and safe working conditions undercover.
Modular is also particularly well suited to certain sectors where demand is predicted to rise, including affordable housing and Build to Rent.
New offsite technologies
While timber frame has been the traditional way of delivering sustainability with flexibility in design, other technologies have been slow to catch on. But the use of volumetric and closed panel systems should grow with key players such as Legal & General entering the space. Panellised homes are also an attractive alternative when built from recycled materials, using 67% less energy in the build process than traditional homes. Waste materials are slashed by being recycled directly into the build process.
Other new superstructure materials driving the interest in modular include autoclaved aerated concrete (AAC) and new composites derived from recycled materials. In fact, so attractive is the sector for third party investment that this is one of the core drivers of growth with the likes of Goldman Sachs, Barratt Homes and Berkley Group pumping millions into the future of modular construction.