The SWISS PROPERTY AG team is excited to see the results of recent modular construction projects in the industry. The solid track record with accelerated project times of 20 to 50 percent and up to 20 percent cost-savings proves Swiss Property is setting the right focus.
Compared to other sectors, the construction industry is still lagging far behind in terms of productivity development. Modular construction, which is not a novelty in itself, now offers for the first time the possibility of a profound shift in the construction industry. Due to strong changes in both the technological and the economic environment, this model is once again gaining in relevance and is thus encountering a new wave of interest and investment.
Modular construction and latest developments
This year McKinsey has published an exciting study on the subject of modular construction. Their research quantifies the potential benefits, examines the challenges and whether modular construction will have a broader and more sustainable impact in the future.
The results show that the prefabricated construction approach has a high potential in terms of time and cost savings. Recent modular projects already show a solid track record with reduced project times of up to 50 percent and a significant reduction in construction costs. McKinsey’s analysis therefore suggests that leading real estate players who are ready to make the change can realize up to one-fifth cost savings in the future. The market value alone for the modular new construction of real estate could reach 130 billion dollars by 2030 in Europe and the USA.
Modular construction has so far only established itself sustainably in a few locations. The majority of these prefabricated buildings still have the reputation of being of poor quality. Nevertheless, there is reason to believe that this will change in the future. More and more clients today are concentrating on sustainability and aesthetics. Thanks to new materials and digital technologies, design capability and variability have grown, precision and productivity in manufacturing have improved and logistics have become easier.
The question of whether a certain market will adopt this type of construction in the future is determined by various influencing factors. The largest are the demand for real estate and the availability and relative costs of skilled (construction) workers. Especially in places where labor shortages and largely unsatisfied demand for housing overlap, this model is becoming increasingly relevant. At SWISS PROPERTY AG, we are convinced that we are moving in the right direction and aim to continue developing and implementing the modular construction in a high-quality and sustainable manner. As a technology-oriented project developer and full-service contractor, we recognized the digital possibilities early on and implemented them in our approach. Our team consists of proven and renowned experts from the construction and technology industries. As an agile and technology-focused real estate specialist, we are a leader in Switzerland and are happy to advise you on your individual construction solution.