The Prefabricated Building Market in Russia is expected to grow at a CAGR of approximately 6.5% during the forecast period driven by affordable, sustainable, and modular construction.
The revenue generated by the prefabricated buildings industry has seen a constant spur during the review period. In 2016, the revenue generated has amounted to USD 2.2 billion whereas in 2019, the revenue generated was USD 2.6 billion. 3D modular house construction is well developed and was one of the most promising methods providing high construction rate of residential buildings.
The country has several companies specializing in CLT production and home construction. CLT is a new product in the Russian market. In many Western European countries, there is a well-developed market for CLT, and it is already used for building residential and commercial buildings of up to 14 stories. Also, new Russian standards for the construction of wooden buildings were announced, which allows for the construction of multi-story buildings using laminated wood framing.
Changes to Russia's building code will make it legal to construct residential buildings of up to seven storeys and public buildings of up to 25 meters in height with wood as the main construction material, subject to certain approvals.Currently, around 50% of the residential projects in Russia are prefabricated. Russia has a large forest area, around 20% of the world’s forest area.
However, the country does not use this potential for building wooden houses when compared to other European countries. According to an estimate, the country uses wood in housing construction by 25 times less than in the Nordic countries.
Key Market Trends
Government Infrastructure Plans to Boost the Construction Sector / prefabricated Sector
Modular and prefabricated technology is utilized to pursue practicality in work, as well as the speed of project development. However, this method is also recognized to be able to improve the quality with qualified standardization and has a higher level of precision compared to conventional projects. In the six-year modernization plan through 2024, the nation is investing USD 96 billion to revamp the country’s highways, transport facilities, airways, and infrastructure. Infrastructure spending will gradually increase in the next six years from USD 5.93 billion in 2019 to USD 9.41 billion in 2024. Of the announced USD 96 billion, the government is investing around 10% in high- speed railways networks, 20% in railway transport and transit infrastructure. With several projects and investments lined up during the forecast period, majorly on the infrastructure sector, the precast construction activity which can be seen on most of the railways and roadways sector is set to see rapid growth in the country.
Metal /Timber/ Wood Market Witnesses Growth in the Prefab Buildings Market
The country used to import prefabricated log building kits from places, such as Finland. However, with the contributions of Russian and foreign firms, the wooden industry of Russia re-emerged. The government has introduced quotas for use of wood in state housing program construction in 2016 - 20% in 2016, 25% in 2017, and 30% in 2018. However, the Russian government initiative to expand the use of timber in construction is expected to boost the growth of the wooden buildings, including multi-story buildings in the future. The use of steel in infrastructure, housing, communal, and social construction is expanding in Russia, owing to the high environmental friendliness of metal structures within their life cycle, as well as the growth of investment in infrastructure.
The Russian market for metal structures has witnessed growth rates higher than the global average growth rate. According to Russian government sources, the volume of production of structures made of ferrous metals has witnessed a growth of more than 20% in FY 2018 with production recaching more than 5 million metric tonnes. The most significant increase in the consumption of steel structures was observed in the segment of construction of engineering infrastructure facilities, as well as agricultural facilities. The prefabricated metal structures have good prospects in Russia. The prefabricated using metal structure has found wide application in the construction of railways and highways. It was required to accommodate many people who came to construction sites, and later to provide housing for railway workers. Also, high seismic stability allows them to be built in almost any region of the Russian Federation. Thus, the volume of construction of frame-modular buildings is growing, and in the coming years, it is expected to grow steadily.
The report covers the major players operating in the Russia Prefabricated Buildings Industry. The market is highly competitive with a few players occupying the major share. Segezha Group is the Russian leader in glulam-based building construction. Segezha subsidiary Sokol Timber Company is a major industrial home-building facility that primarily produces glued timber for export, it has accounted for nearly 18% of Russia's glulam-based housing market in 2017. In June 2019, Segezha Group launched the construction of the CLT manufacturing plant with a production capacity of 250,000 m2 per year. The market is expected to grow during the forecast period due to the increase in the prefab construction building investments and up-coming major projects in the country and other few factors are driving the market. Prefabricated building systems and construction hold high potential to improve the efficiency and performance of the Russian construction industry in a more sustainable sense.
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Table of Contents
1.2 Scope of the Study
2.2 Research Phases
4.2 Technological Trends
4.3 Insights on Supply Chain/Value Chain Analysis of the Prefabricated Buildings Industry
4.4 Brief on Different Structures Used in the Prefabricated Buildings Industry
4.5 Cost Structure Analysis of the Prefabricated Buildings Industry
4.6 Impact of COVID 19
5.4 Porter's Five Forces Analysis
5.4.1 Bargaining Power of Suppliers
5.4.2 Bargaining Power of Consumers / Buyers
5.4.3 Threat of New Entrants
5.4.4 Threat of Substitute Products
5.4.5 Intensity of Competitive Rivalry
6.1.5 Other Material Types
6.2.3 Other Applications ( Industrial, Institutional, and Infrastructure)
7.2 Company Profiles
7.2.1 PIK Group of Companies
7.2.2 LSR group. St. Petersburg
7.2.3 Setl Group. St. Petersburg
7.2.4 Segezha Group
7.2.5 K Modul
7.2.6 Story House
7.2.7 Pallada Eco
7.2.8 INSI Holding
7.2.10 Renaissance Construction
7.2.11 Atlaca Group *
9.2 Key Production, Consumption,Exports & import statistics of construction Materials