The prefabricated buildings industry (henceforth, referred to as the market studied) was valued at USD 2,873.96 million in 2021 and is expected to reach USD 4,695.46 million by 2027, registering a growth rate of 8.53% during the forecast period.
COVID-19 has caused considerable economic damage. The nationwide lockdown globally has halted construction and impacted the labour-intensive sector. This is due to the migrant workers being stranded at construction sites, and the halted construction activities are hampering the growth prospects across the world.
The increase in demand for prefabricated housing in the region, including manufactured housing, modular housing, precut housing, and panelized housing, is driven by continued gains in housing demand across the country.
The growth in the prefabricated buildings market is majorly due to the increasing construction activities across the country and the lack of affordable houses for expatriates working for the ongoing development projects in Saudi Arabia.
The growth of modular construction is high in remote and rural areas, which is expected to impact the overall market growth during the forecast period significantly.
The residential construction industry in Saudi Arabia is facing a shortage of affordable housing as a result of a growing population and an influx of expatriates. This has encouraged the demand for prefabricated homes, as they are cost-effective and time-efficient. Furthermore, prefabricated buildings are more environmentally friendly than conventionally constructed buildings, as they do not generate any on-site waste. This is projected to positively influence the market demand in the upcoming years. Moreover, energy efficiency, design flexibility, and faster completion are some of the other advantages of prefabricated building, which are anticipated to drive the market growth.
Backed by the Ministry of Housing, the modular construction undertaking is relied upon to help Saudi Arabia’s homeownership strategy, which predicts 70% of residents owning homes by 2030. Moreover, Saudi Arabia’s recent budget shows that the government is focusing on infrastructural reforms as per the 2030 vision.
In Saudi Arabia, the housing shortfall is growing rapidly ,to address this deficit, the government established a Real Estate Development Fund, which developed various financing schemes to increase the home ownership rates. It also consolidated government land under the Ministry of Housing to accelerate the delivery of the 500,000 units announced through a royal decree. The Ministry of Housing recently started a PPP program to complement other housing delivery initiatives.
Moreover, supported by the Ministry of Housing, the modular construction project is expected to support Saudi Arabia’s homeownership strategy, which envisions 70% of citizens owning homes by 2030. The growth of modular construction is high in remote and rural areas, which is expected to have a significant impact on the overall market growth during the forecast period.
Key Market Trends
Metal Holds the Major Share in Prefab Buildings Industry
Metal is one of the most widely used construction materials, across the world, in both traditional and modern construction processes.
Prefabricated metal structures are widely used in the construction of commercial buildings, skyscrapers, warehouses, and infrastructure developments.
Companies, such as Zamil Steel, have been playing a major role in the prefabricated metal buildings industry in Saudi Arabia over the past few years.
Metal has been used as an alternative to concrete and other construction materials in the modern construction process, owing to its high durability and reliability in several ways. Additionally, metal prefabricated buildings are estimated to save construction costs up to ~60% in the Middle East, as compared to that of traditional construction.
Structural steel is a highly important material utilized for framing structures in the building and construction industry. Prefabrication of steel bridges forms an important part for the transportation infrastructure projects.
Prefabricated or pre-engineered steel buildings provide so many advantages over other building materials, such as customization, speed of construction, decreased maintenance, and insurance costs. The components are created from steel at a manufacturing plant and delivered to the job site. Warehouses, retail spaces, event centers, and homes are all ideal steel projects for the prefabrication.
In the country, Neom (the Kingdom’s flagship project), the Red Sea Project, and Qiddiya (the capital of entertainment) are some of the key mega projects shaping the infrastructure and construction roadmap.
A rebound in project activity in Saudi Arabia, following a relative lull due to the spread of COVID-19 boosted steel prices by over 6% in January 2022. From around 3,558 Saudi riyals (USD 948.8) in December 2021, the price of one ton of steel grew to nearly 3,790 riyals (USD 1,010.6) in January 2022. The increase in steel prices was due to an upturn in project activity, higher domestic demand, and an increase in steel exports.Moreover, there also has been a steady increase in the construction of private houses, following the introduction of new mortgage facilities.
Governments’ Investments and Plans in Residential Housing to Boost the Prefab Industry
Factors, such as are growing construction activities, demand for affordable housing, social change, and a need to support the population with access to more plentiful and better-quality accommodation, are expected to drive the market growth in Saudi Arabia during the forecast period. Additionally, the rising trend of providing housing facilities, to migrant blue-collar laborers working on ongoing construction and industrial projects, is also expected to boost the demand for modular construction during the forecast period.
The unavailability of affordable housing, owing to population growth, along with an influx of expatriates, has encouraged the demand for prefabricated homes in Saudi Arabia. Rapid urbanization and upcoming infrastructural projects are projected to further provide a thrust to the market, for prefabricated structures in Saudi Arabia during the forecast period.
According to the Saudi Arabian housing ministry, an estimated 1.5 million houses must be built by 2030, to address the housing shortage in the country. The government is taking significant steps in addressing the shortage of affordable housing revenues from the While Land Tax, which is expected to contribute toward the funding of affordable housing projects.
Similarly, the Ministry of Housing’s ‘ESKAN’ project aims to add 500,000 units, to the total stock of the country’s affordable housing. King Salman urged the Housing Ministry to build suitable and affordable housing for citizens, as it is a government priority. The government issued legislation and has set aside a huge allocation in the budget for housing. Several important housing schemes are planned by the Ministry of Housing during the forecast period to build and support affordable housing namely ETNAM, WAFI, etc.
Increase in population growth, urbanization, and tourism are expected to drive growth in the building sector, especially in the residential and leisure markets.
The Saudi Arabia prefabricated building industry is moderately consolidated, with the major players having a significant share to influence the market.
Some of the major players in the Saudi Arabian market for prefabricated buildings are Red Sea Housing, Zamil industries, United Company for Caravans and Prefab Houses, Al-Shahin Metal Industries, and Kirby Building Systems are involved in both manufacturing and contracting activities of the prefabricated building market industry.
Apart from the top players, there are some major domestic companies that provide prefabricated building systems in the major cities across the country, such as Zamil Industrial investment co., Unifab United Company for Caravans, and prefab houses, and Al-Shahin Metal Industries. There is intensifying competition in the market due to various American and Chinese building systems in the market, which are offering fast construction of prefabricated buildings at a lower cost compared to traditional building systems.
The market estimate (ME) sheet in Excel format
3 months of analyst support
Our reports have been used by over 10K customers, including:
345 pages •
By Asia Market Information & Development Company
• Jun 2022
China’s demand for Stabilizer has grown at a fast pace in the past decade. In the next decade, both production and demand will continue to grow. The Chinese economy maintains a high speed growth which has been stimulated by the consecutive increases of industrial output, import & export, consumer consumption...
The high-performance insulation materials market is expected to register a CAGR of 7.61% during the forecast period (2022-2027). Key Highlights The growing usage in the oil and gas industry and rising awareness regarding greenhouse emissions and energy savings are likely to drive the growth of the high-performance...
The global hygroscopic building material market size is projected to grow from USD 818 million in 2022 to USD 1,120 million by 2026, at a CAGR of 6.5% between 2022 and 2027. Rising demand from emerging markets and growth of construction industry globally are expected to offer significant growth opportunities to manufacturers of hygroscopic...
Construction Market Size, Trends and Growth Forecasts by Key Regions and Countries, 2022-2026 Summary Having made good progress in recovering from the severe downturn recorded in 2020 amid the widespread disruption caused by restrictions imposed to contain the spread of COVID-19, the global construction...
The Nitrile Butadiene Rubber (NBR) Market is valued at over 1,000 kilotons in 2021 and is projected to register a CAGR of over 5% during the forecast period (2022-2027). Due to the COVID-19 outbreak, nationwide lockdown around the globe, disruption in manufacturing activities and supply chains, production halts have negatively impacted...
The global silica market is estimated at 458.22 million tons in 2022. The market is projected to register a CAGR greater than 6% during the forecast period (2022-2027). In 2021, the demand for silica surged due to the increase in construction projects across the globe. The increasing usage of high-quality concrete is expected to drive...
The global fiber reinforced concrete (FRC) market was valued at USD 2,426.52 million in 2021, registering a CAGR of greater than 5% during the period, 2022-2027. The market has seen robust growth in 2021 after the recovery from 2020 due to the COVID-19 pandemic. The construction industry is the prime application sector for fiber-reinforced...
The Analysis of Key Sectors and Investment Opportunities in Qatar is expected to register a CAGR of more than 4% during the forecast period (2022 - 2027). Qatar’s economy faced difficulties in 2020 and the first half of 2021 as a result of the simultaneous shocks of falling oil prices and the impact of the pandemic, which resulted in a -3.7...
Turkey Construction Market Size, Trends and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis, 2022-2026 Summary The construction industry in Turkey registered a marginal annual decline of 0.9% in real terms in 2021,...
Canada Construction Market Size, Trends and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis, 2022-2026 Summary The construction industry in Canada registered an annual growth of 6.1% in real terms in 2021, compared...
You can change your Cookie Settings at any time but parts of our site will not function correctly without them.