Trends Changing the Infrastructure Marketplace

The infrastructure industry is poised for growth over the next decade, despite the lull we see in 2016. The growth will be primarily in emerging markets of EMEA, LATAM and APAC driven by urbanisation and globalisation, doubling output and becoming a USD 6+ trillion industry in the given timeframe. While the growth itself will necessitate changes in approach, the macroeco-nomics of globalisation will compel innovation – to achieve scalability, cost and timelines. Let us take a look at the noteworthy trends in the infrastructure industry globally, with considera-tions for economies like China and India which are driving a good part of the growth story. Urbanization The global urban population of 4 billion is expected to increase by 20% from 2012 to 2020. Ac-commodating this expanding population will provide the biggest challenges and opportunities to the infrastructure industry. As an example, megacities will be added to the mix with approximate-ly a population of half a million in each of them. Financing Closely connected to construction, housing finance is becoming an increasingly important sector that drives trends in the infrastructure industry. ‘Home ownership’ being a timeless middle-class dream, the housing finance companies are entering micro markets and reaching out to seg-ments that are also accepting finance as a home purchase mechanism. In countries like India, while constructing a home was often a milestone later in life, financing has enabled the Gen Y to be the majority of home buyers at 68% of all home buyers. Innovating with Pre-Fab The high resource dependent construction market, where productivity has been a chronic issue, is seeing the infusion of automation using efficient technologies and processes. Pre-fabricated and modular construction is one such trend which reduces time by up to 50% and cost by up to 30%, while ensuring better quality. For example, India’s ‘Housing for All 2022’ project will create a demand for around 30 million low-cost homes and this is expected to give the pre-fabrication sector a huge boost. Currently more popular in commercial real estate, pre-fabricated construc-tion is making headway into the residential housing sector. India’s relaxation of FDI norms will also invite established foreign players in the pre-fabrication sector creating competition and ben-efiting end consumers. Constructing around sustainability Responsible construction has grown from a mere ideology into a set of regulations, initiatives and stipulations that are changing the industry landscape. Energy consumption efficiency needs to improve by 30% in the next 15 years to meet energy supply versus demand. This has a major impact on the construction industry where changes are seen as more efficient infrastructures being constructed, harvesting of natural resources, and use/implementation renewable energy sources. Green Importance Recyclable materials and water conservation are just two of the important factors as construc-tion goes green. With studies estimating that 70% of the world’s population will be urban by 2050, the infrastructure industry will bear the biggest responsibility towards environmental balance. A Bright Future A higher living standard, demand for integrated facilities, new policies and technology innovation are shaping the infrastructure industry’s future. For the infrastructure company of the future, keeping keyed into the evolving trends and market drivers is key and innovation will play a major role in success. Sources - https://www.dnaindia.com/money/report-bottom-of-pyramid-can-be-big-for-home-fin-firms-2280056 https://www.constructionbusinesstoday.net/trends https://www.businesstoday.in/magazine/features/prefabricated-homes-quicker-to-build-are-gaining-popularity/story/228918.html https://www.moneycontrol.com/news/24x7booking/can-prefab-construction-make-homes-more-affordable_8044801.html https://buildotechindia.com/shortage-of-skilled-construction-labour-%E2%80%93-a-paradox https://igbc.in/igbc/redirectHtml.htm?redVal=showAboutusnosign https://www.nar.realtor/sites/default/files/reports/2015/2015-home-buyer-and-seller-generational-trends-2015-03-11.pdf