Pre-Engineered Buildings Market

Market Overview

The global pre-engineered buildings market size was valued at USD 19.52 billion in 2023. It is estimated to reach USD 63.47 billion by 2032, growing at a CAGR of 14.0% during the forecast period (2024–2032). In the past few years, the world has witnessed exponential population growth and rapid urbanization, which has led to an improved demand for development and boosted the construction industry, thereby augmenting the global pre-engineered buildings market. This population expansion, urbanization, and construction is more prominent in emerging nations, resulting in a higher demand for efficient and economical construction solutions, thereby creating opportunities for global market expansion.

Pre-engineered buildings (PEBs) are a type of construction where the structural components are fabricated in a factory and then assembled on-site. These buildings are designed and manufactured in a controlled environment, ensuring precision and quality. The primary materials used are steel, although other materials like aluminum and composites can also be used. PEBs are highly versatile and can be customized to meet specific requirements, making them ideal for various applications, including industrial warehouses, commercial complexes, sports facilities, and even residential buildings.

The design process involves pre-determined sections that are engineered to fit together seamlessly, reducing construction time and costs. Additionally, PEBs offer several advantages, such as enhanced durability, energy efficiency, and minimal maintenance. With advancements in technology and materials, PEBs have become increasingly popular worldwide, providing a cost-effective and sustainable alternative to traditional construction methods. Their growing adoption is driven by their efficiency, adaptability, and ability to withstand diverse environmental conditions.

Highlights

• Single-story dominates the structure segment.
• Commercial dominates the application segment.
• Asia Pacific is the highest shareholder in the global market.

Market Dynamics

Global Pre-Engineered Buildings Market Drivers:

Population Growth and Rapid Urbanization

The demand for new development is driven by population growth and rapid urbanization, which is a significant driver for the pre-engineered buildings market. According to the United Nations World Population Prospects report, the global population is projected to reach 8.1 billion by 2024, up from 7.9 billion in 2023. This increase necessitates substantial infrastructure development, including residential, commercial, and industrial buildings. Additionally, the World Bank's Urban Development report shows that the global urban population grew by 2.3% in 2023, compared to 2.1% in 2022, heightening the need for housing, healthcare facilities, and other amenities.

The pre-engineered buildings market has benefited from this surge, as these structures offer cost-effective and time-efficient solutions for rapid construction. According to the Construction Industry Development Board, the use of pre-engineered buildings in urban development projects increased by 18% in 2023, up from 12% in 2022. This trend is particularly evident in developing regions with high urbanization rates, such as Asia and Africa, where the demand for affordable and quickly deployable building solutions is substantial.

Global Pre-Engineered Buildings Market Restraint:

Volatility in Raw Material Prices

The volatility in raw material prices significantly restrains the Global Pre-Engineered Buildings Market. These structures rely heavily on metals like steel and aluminum, which have seen substantial price fluctuations. The World Steel Association reported a 12% increase in the global average price of hot-rolled steel coil in 2023, following a 9% rise from 2021 to 2022. Similarly, the Aluminum Association noted an 8% rise in the average price of primary aluminum ingot in 2023, after a 5% increase in 2022.

This volatility impacts the overall cost of pre-engineered buildings, challenging manufacturers to maintain consistent pricing and profitability. According to the Construction Economics and Building Materials Research Center, these buildings' raw material cost components increased by 7% in 2023, compared to 4% in 2022. These fluctuations can lead to project delays, renegotiations, and reduced profit margins, hindering market growth and adoption by creating financial uncertainty for manufacturers and contractors.

Global Pre-Engineered Buildings Market Opportunities:

Expansion in Emerging Markets

Emerging markets present significant growth opportunities for the pre-engineered buildings market. Countries in Asia-Pacific, Latin America, and the Middle East are experiencing rapid urbanization and industrialization, leading to increased demand for efficient and cost-effective construction solutions. For instance, India's construction industry is projected to grow at a CAGR of 15.7% from 2021 to 2026, driven by government initiatives like the Smart Cities Mission and the Make in India campaign.

Similarly, the Middle East's focus on diversifying its economy beyond oil has led to substantial investments in infrastructure development, boosting the demand for PEBs. The affordability and versatility of PEBs make them ideal for various applications, from commercial buildings to industrial complexes and residential projects. Furthermore, the increasing foreign direct investment (FDI) in these regions is expected to support the construction sector's growth, providing a fertile ground for the expansion of the PEB market. As awareness about the benefits of PEBs grows, these emerging markets are likely to become significant contributors to the global market.

Regional Analysis

Asia Pacific Dominates the Global Market

Based on region, the global market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

The Asia-Pacific region holds the largest share of the global pre-engineered buildings market and is anticipated to experience substantial growth during the forecast period. This expansion is driven by rapid industrialization, urbanization, and significant infrastructure development. According to the Asian Development Bank, the region's urban population grew by 2.7% in 2023, up from 2.5% in 2022, creating a heightened need for residential, commercial, and industrial facilities. China stands out as a key player, with the Ministry of Housing and Urban-Rural Development reporting a 22% increase in the use of pre-engineered buildings for industrial and logistics projects in 2023, compared to 17% in 2022. This growth is fueled by government initiatives promoting sustainable and efficient construction practices, along with the booming e-commerce sector that demands extensive warehousing facilities.

India also shows a remarkable uptake in pre-engineered buildings, spurred by the "Make in India" campaign and a burgeoning manufacturing sector. The Indian Institute of Metals noted an 18% rise in demand for pre-engineered steel structures in industrial projects in 2023, compared to 12% in 2022. Additionally, the Indian Green Building Council's recognition of the environmental benefits of these structures has led to their increased adoption in sustainable construction projects. Southeast Asian nations are similarly contributing to the market's growth, driven by urbanization and industrial expansion. The collective regional efforts towards modernization and sustainable development are expected to continue propelling the Asia-Pacific pre-engineered buildings market forward, solidifying its dominance on the global stage.

North America has emerged as a sub-dominant region in the global pre-engineered buildings market, primarily driven by the growth of the e-commerce industry, the need for efficient logistics infrastructure, and the adoption of sustainable construction practices. In the United States, the Federal Highway Administration reported a significant increase in the use of pre-engineered buildings for warehouse construction, rising to 16% in 2023 from 12% in 2022. This trend is closely linked to the expansion efforts of e-commerce giants like Amazon and Walmart, which are investing heavily in their distribution networks.

In Canada, the government has acknowledged the benefits of pre-engineered buildings, with the National Research Council of Canada actively promoting their use in sustainable and energy-efficient construction projects. The Canadian Institute of Steel Construction reported a notable rise in demand for pre-engineered steel buildings in commercial and institutional projects, growing to 14% in 2023 from 10% in 2022. Additionally, the North American market is bolstered by the presence of well-established pre-engineered building manufacturers and a robust construction industry. According to the Metal Building Manufacturers Association (MBMA), its member companies saw a 12% increase in pre-engineered building orders in 2023, up from 8% in 2022. This data indicates the growing acceptance and adoption of these structures across various sectors in North America.

Segmental Analysis

The global pre-engineered buildings market is bifurcated into structure and application.

Based on the structure, the global pre-engineered buildings market is bifurcated into single-story and multi-story.

The single-story segment dominates the global market during the forecast period. Single-story pre-engineered buildings are gaining traction due to their cost-effectiveness and rapid production compared to factory-made homes or RCC construction. These structures are quickly constructible and can be customized to meet specific needs, making them ideal for disaster relief shelters. Their design flexibility and easy transportation enhance their demand for temporary kitchens, vocational houses, and other facilities. The affordability and space efficiency of single-story pre-engineered buildings make them increasingly popular, especially as urban spaces become more constrained.

Additionally, government initiatives promoting green building concepts boost this market segment, as these buildings incorporate eco-friendly features and conserve energy and water during construction. The rising demand for affordable, sustainable, and versatile construction solutions propels the growth of the single-story pre-engineered buildings market.

Based on application, the global pre-engineered buildings market is bifurcated into commercial and industrial.

The commercial segment owns the highest market share over the forecast period. Commercial spaces like office buildings, warehouses, and retail structures like shops and shopping centers are all included in the commercial buildings. Pre-engineered structures are preferred over RCC buildings in the commercial sector because they are more affordable, stronger, more durable, recyclable, and take less time to construct. They are also commonly utilized in commercial warehouses, cold storage, and many more applications.

Additionally, the development of the industry is fueled by current initiatives in developing nations like China and India. For instance, Everest Industries Ltd., a company located in India, invested about USD 7.2 million in May 2016 to advance pre-engineered building technology and support pre-engineered building projects in other parts of India. Furthermore, the market leaders' new acquisition-focused tactics are anticipated to increase their customer bases and demand for pre-engineered structures shortly.

Recent Developments

• April 2024- Ratnabhumi Steeltech has emerged as a top manufacturer of MS ERW pipes, tubes, and Pre-Engineered Buildings (PEB). This development signifies the company's strong position in providing essential components for construction, aligning with the growth of the Global Pre-Engineered Buildings market. Ratnabhumi's expertise contributes significantly to the construction industry's infrastructure needs.
• July 2024- Pennar Industries, a firm specializing in engineering goods and solutions, plans to create a manufacturing facility for pre-engineered buildings (PEB) in Raebareli, Uttar Pradesh.