Global, August 22, 2025
News Summary
A broad study of the modular construction sector covering 700+ companies across 50+ countries finds rapid expansion and clear profit patterns. Companies that combine factory manufacturing with on‑site assembly report substantially higher EBITDA than manufacturers-only players. Modular methods reduce on‑site labor, shorten schedules, and cut waste when systems and logistics are optimized. Cities are testing zero‑emission sites using electric machinery and battery power, while architects deliver near net‑zero buildings that pair off‑site construction with low‑carbon site operations. Success is tied to repeatable building systems, value‑chain control, digital integration and careful, demand‑led scaling.
Modular construction surges: 700+ firms show gains, integrated players post the best margins
A new industry analysis of more than 700 modular firms across 50+ countries shows modular building methods are growing fast and delivering clear business and environmental advantages — especially for firms that control more of the building process. The research finds that companies that both manufacture and assemble modules tend to post much higher profit margins than those that only make parts, while off‑site building methods can cut labor needs and project timelines sharply.
Key findings up front
- Database covers over 700 companies; more than 100 have operated 50+ years and more than 200 were founded in the past 20 years.
- Market is highly fragmented: roughly 60–70% of firms earn less than €50 million in revenue; only 5–10% have revenues above €500 million.
- Firms that combine modular manufacturing and on‑site assembly report average EBITDA margins of around 15–20%, versus ~5% for manufacturing‑only firms. Firms focused on permanent buildings show a weighted average EBITDA near 7%.
- Modular methods can reduce jobsite labor by up to 40% and speed schedules by up to 50% when applied at scale.
Why integration matters
Companies that manage more steps of the value chain — from design and manufacturing to on‑site assembly — capture more value. Advantages include broader project scope, specialized teams, fewer subcontractor pass‑through costs, tighter logistics and faster learning cycles. Successful firms tend to center on a repeatable building system focused on one structural material and to scale in a careful, focused way.
Where profits are strongest
Profitability varies by product, building type and complexity. Firms producing 3D volumetric modules see slightly higher margins than those making 2D panels. The hospitality sector posts the highest average profitability near 19% EBITDA, while single‑family and multiunit residential segments average about 8% EBITDA. Lower‑complexity, repeatable projects often yield higher margins because factory work and standardization are maximized.
Materials, markets and models
Globally, company focus breaks down roughly to 42% steel, 38% timber and 11% concrete. Most firms use a project‑based sales model; however, rental and mixed sales+rental models improve factory utilization and often deliver higher returns. Today the market remains mostly local — more than 60% of firms operate primarily in a single market — but digital tools and new logistics are making cross‑border work more feasible.
Environmental and site innovations
Modular and off‑site fabrication reduce waste and improve safety by moving much of the work into controlled factory settings. These methods pair naturally with circular strategies like reuse, controlled dismantling and upcycling, and with digital material passports that track components for future reuse.
Zero‑emission construction pilots and net‑zero buildings
Practical examples include a city pilot that ran an urban construction site with only electric heavy machines, saving about 35,000 litres of diesel and roughly 92.5 tonnes of CO2 compared with diesel operations. The pilot achieved roughly 99% emissions savings except for a propane burner that lacked a clean alternative. Battery container systems designed to replace diesel generators are in active use in several places, cutting both emissions and noise by large margins and offering remote monitoring and smart power delivery.
On the building side, a recently completed mixed‑use project in a transformed industrial neighborhood demonstrates net‑zero strategies for heating, cooling and ventilation. The building pairs geothermal wells, rooftop solar, thermal mass and natural ventilation to lower energy need and shrink embodied CO2 from materials and transport by over 50% compared with standard practice. Design choices such as façade valves and exposed concrete cores reduce the need for ductwork and mechanical systems and keep future remodeling simpler.
What firms and cities should watch
The study highlights three shared traits among successful modular players: a clear building system, meaningful control of the value chain, and disciplined, focused scaling. Mistakes to avoid include building large automated factories before stable demand is proven and expanding into new geographies too soon. For cities and developers, public procurement targets for zero‑emission sites and tighter sustainability rules are accelerating demand for cleaner equipment and modular approaches.
Bottom line
Modular construction is no longer niche. It offers clear benefits in speed, labor savings and lower waste, and the best margins go to companies that integrate manufacturing and assembly and stick to a focused, repeatable system. Yet the market remains fragmented and still captures only a small share of overall construction — leaving room for multiple successful players but also risks for investors and firms that scale prematurely.
FAQ
What is modular construction?
Modular construction means making major parts of a building in a factory and assembling them on site. It covers 3D volumetric modules, 2D panels and bathroom pods for mainly permanent buildings.
How much time and labor can modular save?
At scale, modular projects can cut manpower by up to 40% and speed project timelines by up to 50%, depending on the work and how standardized the design is.
Which firms earn the best margins?
Firms that both manufacture and assemble modules typically post higher EBITDA margins (about 15–20%) than firms that only manufacture (around 5%). Integrated players capture more value by controlling design, logistics and on‑site work.
Can modular help reduce carbon emissions?
Yes. Off‑site construction reduces on‑site waste and can cut embodied and operational emissions, especially when combined with electrified equipment and renewable energy on site.
Are zero‑emission construction sites practical today?
Yes. Trials using electric heavy equipment and battery power systems have cut diesel use, noise and CO2 substantially. Challenges include upfront equipment cost and reliable site power, but solutions like battery containers are already in use.
Quick reference: key features
| Feature | What it means | Data point |
|---|---|---|
| Industry scope | Companies tracked across multiple countries focusing on modular products | 700+ firms in 50+ countries |
| Profitability by model | Integrated manufacturing + assembly vs manufacturing-only | ~15–20% EBITDA vs ~5% EBITDA |
| Labor & time benefits | Reduction in on‑site crews and faster delivery | Up to 40% less labor, up to 50% faster |
| Material focus | Main structural materials used by firms | Steel 42%, Timber 38%, Concrete 11% |
| Environmental pilots | On‑site electrification and battery power replacing diesel | 35,000 litres diesel saved, ~92.5 tonnes CO2 saved on a pilot site |
Deeper Dive: News & Info About This Topic
Additional Resources
- McKinsey: Putting the pieces together — Unlocking success in modular construction
- Wikipedia: Modular construction
- BBC Future: The Scandinavian way to zero‑carbon construction
- Encyclopedia Britannica: Zero‑carbon construction (search)
- Designboom: Snøhetta Vertikal Nydalen, Oslo (Apr 27, 2024)
- Google Search: Snohetta Vertikal Nydalen Oslo
- Electrive: Oslo’s first zero‑emissions construction site in action
- Google News: zero‑emission construction site Oslo
- Noticias Ambientales: Circular construction — From use‑and‑throw‑away to reuse and transform buildings
- Google Scholar: circular construction reuse transform buildings
Author: Construction TX News
TEXAS STAFF WRITER The TEXAS STAFF WRITER represents the experienced team at constructiontxnews.com, your go-to source for actionable local news and information in Texas and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Texas Construction Expo, major infrastructure unveilings, and advancements in construction technology showcases. Our coverage extends to key organizations like the Associated General Contractors of Texas and the Texas Building Branch, plus leading businesses in construction and real estate that power the local economy such as Austin Commercial and CMiC Global. As part of the broader network, including constructioncanews.com, constructionnynews.com, and constructionflnews.com, we provide comprehensive, credible insights into the dynamic construction landscape across multiple states.
