AMA Research have just published the fifth edition of the report "Panellised Modular Building Systems Market Report - UK 2014-2018 Analysis". Previously named 'Prefabricated Frame and Panel Building Systems' this edition of the report, incorporating original input and primary research, has been substantially updated and represents an up-to-date review of this changing and complex market.
Following a difficult period for the sector, market performance is slowly improving in 2013/14 and panellised modular building systems have substantial market potential in the medium term, and are forecast to demonstrate long-term growth - particularly as key public sector departments focus more on energy-efficiency and cost-savings through the Modular Building Systems Framework to deliver large-scale development programmes.
Ayrshire Metal Products, Bell and Webster Concrete, Bison Manufacturing, Buchan Concrete Solutions, BW Industries, Creagh Concrete Products, Deeside Timberframe, Frame Homes (South West), Hanson Structherm, Kingspan Timber Solutions, Laing O'Rourke, Lanefield Timber Frame, McAvoy Group, Merronbrook, Metek Building Systems, Metsec, Oregon Timber Frame, Pinewood Structures, Prestoplan, Robertson Timber Engineering, Roe Timberframe, Space 4, Stewart Milne Group, Taylor Lane Timber Frame, Walker Timber Group, Western Building Systems.
2>SUMMARY OF REPORT CONTENTS2>
The UK market for panellised modular building systems is estimated to be worth some £440 million in 2013.
The market comprises factory manufactured, 2-dimensional frames or panels for constructing walls, partitions, roofs and floors, typically supplied to site as systems in flat-pack format. The main material used is timber, with other competing materials being light gauge steel, precast concrete and panels made from insulated oriented strand boards (SIPS).
The market has remained subdued following a period of significant decline between 2008 and 2010, primarily due to the downturn in housebuilding activity, cuts in public sector capital expenditure, the completion of major public sector construction projects and falling investment in private sector newbuild.
From 2013 onwards the tentative recovery in the economy, driven by the recovery in the UK housing and London office construction sectors have fed through to increased demand for MMC, partly due to temporary shortages of aircrete blocks and bricks. However, from 2015 the market is likely to experience more modest growth rates as this situation changes.
The timber frame sector is by far the largest under review, with trends here largely underpinning those at the overall level. By value, the timber frame market was worth around £400m at msp. The three other sub-sectors are much smaller, accounting collectively for around £110m.
Key end use sectors for panellised modular building systems are houses, apartment blocks, schools, budget hotels, smaller healthcare and care facilities and purpose built student accommodation. However, demand across the public sector has been impacted upon by cuts at central departmental, agency and local authority levels.
The industry has undergone some restructuring in recent years, with the exit of a number of major suppliers, particularly in the timber frame sector. Market supply is fairly fragmented, with no suppliers having dominant market shares - there are only three relatively large manufacturers of timber frame system that regularly report annual sales over £20m.
There could be a sustained recovery in demand for panellised modular systems in the short to medium term provided that key construction sectors, such as the private housebuilding sector, continue to recover. The government's pledge to support the development of up to 30,000 affordable homes in England and the need to accommodate thousands of armed forces personnel relocating from Germany should mean that affordable housing will provide a key sector for growth.
Another key driver should be the government's Modular Building Systems Framework, which should encourage the increasing specification of steel frame and timber frame modular building systems on public sector projects. Other factors that should help overcome barriers to specification include the mandatory implementation of BIM across the public sector and the introduction of a quality assurance scheme by Build Offsite.
Taking these factors into account, forecasts for the short to medium term are for steady growth within the range of 3-5% per annum.