The UK market for volumetric modular buildings and portable accommodation has improved over the last couple of years, underpinned by recovery in the general economy and in non-domestic construction. Market demand declined between 2008 and 2013, but has seen improvement since then, underpinned by demand for site accommodation on major infrastructure projects and in the events sector, and recovery in key applications for offsite construction such as student accommodation and schools.
Products are broadly split between ‘permanent’ and ‘semi-permanent’ buildings, on the one hand, which are usually constructed from two or more modules, and portable accommodation. The latter sector mostly comprises a wide range of single module products hired or leased for short periods.
Key areas of demand for volumetric permanent and semi-permanent structures are the healthcare sector, social housing apartments, sports facilities and commercial offices. Between 2005 and 2013, by far the largest application for volumetric construction had been MoD single living accommodation, driven by major building programmes, notably Project SLAM and Project Allenby/Connaught. However, the end of these contracts contributed towards a sharp downturn in the industry as a whole and demise of some leading suppliers.
Distribution channels include direct sales to end users and main contractors and the hire / leasing market. The hire sector comprises dedicated hire divisions or subsidiaries of manufacturers of modular building systems, independent companies specialising in the hire /rental of temporary accommodation, and general plant hire companies.
Over the medium term, a sustained recovery in key end-use sectors is expected to sustain demand, and it is estimated that the overall market will have grown by around 25% by 2020. Growth rates are likely to remain high over the next 2-3 years before stabilising at around 3% towards the end of the forecast period. However, in the longer term, housing is a sector offering great potential where penetration rates for volumetric construction remain low.
“The ongoing shortage in new housing output, which is way below the aspirational targets of the government, coupled with shortages of skilled tradesmen has been widely recognised as a potential driver for offsite solutions” said Andrew Hartley, Director of AMA Research. “The government has granted funds to a leading construction firm to build a factory dedicated to manufacturing housing and, in the social housing sector, procurement group LHC implemented a 4-year offsite housing framework to stimulate demand for volumetric and panelised housing systems.”
One other key factor expected to drive up demand for offsite construction is Building Information Modelling which is now becoming mandatory for public sector building projects. A key advantage with BIM is that it can streamline building design, procurement, construction and maintenance processes. It should facilitate standardisation in design, where required, and in turn favour the use of offsite construction. BIM will also enable sustainable energy and building approaches to be incorporated from the outset, which ought to favour volumetric buildings as these have better airtightness properties than traditional constructions.
The ‘Prefabricated Volumetric Buildings Market Report – UK 2016-2020 Analysis’ report is published by AMA Research, a leading provider of market research and consultancy services with over 25 years’ experience within the construction and home improvement markets. The report is available now and can be ordered online at www.amaresearch.co.uk or by calling 01242 235724.