Those cool, futuristic buildings rising in Riyadh’s skyline? They’re not just eye candy—they’re also changing the economics of real estate. Modular construction, with its sleek, prefabricated designs, is speeding up construction and cutting costs. 

But there’s more than efficiency at play. These designs are drawing a new wave of eco-conscious buyers willing to pay a premium for smart, sustainable living. While upfront costs might be higher, the returns—higher property values and lower long-term expenses—make modular the next big bet for developers.

LIGHT MATERIALS, HEAVY IMPACT

Modular construction is less about aesthetics and more about efficiency and delivering sustainable, high-quality buildings, believes Scott Henshaw, Group Head of Design & Engineering, Red Sea Global. 

For modular construction to be cost-effective, the base building design must consider strict planning principles, working from a clear, repetitive module early in the development process. The overall design must consider fabrication, transportation, and ease of installation to be successful. In the case of modular components, such as bathroom pods, one must also consider other aspects, such as installation clearances, paths of moving modular components into the building, compatibility of modular components with base building construction and the connection of all services. 

Also, structural systems must be adaptable to create generosity of space, he adds, which is a ‘value-add’ in luxury developments and allows for multiple opportunities for pod elements such as gracious baths, substantial primary suites and dressing rooms, and large open kitchens or other amenities that luxury buyers demand.  

MEP (mechanical, electrical, and plumbing) elements should be carefully considered to easily integrate into building systems or have compact standalone systems integrated into the modular pod. 

Henshaw says, “Consideration of materials that are lightweight and durable add to the overall success of modular design. The aesthetics and modularity of the building must work in tandem with a controlled variation that works with the module. Designing buildings from the inside out is key.”

Financial success is closely tied to the ability to present the advantages of modular buildings by leveraging their inherent strengths, says Hassan Alassafi, General Manager – Engineering and Construction at National Housing Company. When design options incorporate unity, symmetry, pattern, and alignment, manufacturers can enhance their financial competitiveness.

For Richard Abboud, Chief Strategy and Transformation Officer at AMANA Group, modular construction, viewed through the lens of quality and neatness, delivers a high standard of workmanship that can attract clients.

He says, “This enhanced quality can significantly benefit the financial model of any project, demonstrating that aesthetics, while secondary, play an important role in overall success. Modular projects with visually appealing designs can attract higher-end clients or buyers, leading to potentially increased property values or rental yields.”

“Appealing modular space principles focus on occupant comfort, friendly finishes, and well-crafted details to create a memorable spatial design,” says Henshaw. In many ways, modular construction should look and feel substantial, permanent, and fully integrated. The advantage of modular construction lies in its ability to achieve what may not be possible in conventional construction regarding cost, time, or quality.

Strategic design choices in modular construction can contribute to long-term financial success by incorporating elements that enhance functionality and sustainability. For instance, Abboud states that energy-efficient designs not only reduce operational costs but also appeal to environmentally conscious buyers and tenants.

MODULAR FOR THE MASSES

One of the most promising trends in modular design that could significantly impact financial outcomes for developers is productization, adds Abboud. This approach involves standardizing and streamlining the design and construction processes, resulting in faster delivery times and reduced costs.

He says, “By creating a catalog of pre-designed modules, developers can minimize customization, which often leads to delays and increased expenses.”

The advantages of productization extend beyond mere efficiency. By offering a range of standardized options, developers can appeal to a broader market, enhancing the potential for higher sales volumes. Repeated designs can also allow for economies of scale in production, reducing material waste and manpower costs.

Moreover, productization fosters innovation in materials and construction techniques. As developers refine their modular designs, they can incorporate advanced technologies and sustainable materials, appealing to environmentally conscious buyers and investors.

Wissam Hijazi, VP of Innovation – MENA at EllisDon, believes that digital twin technology and IoT integration are particularly transformative, enabling real-time insights and predictive maintenance for complex projects. In urban developments and infrastructure projects, digital twins provide control over assets from initial design through operations, allowing project teams to simulate scenarios, optimize resources, and manage facilities proactively.

By incorporating IoT with digital twins, real-time data from sensors embedded in equipment and structural systems can be continuously monitored, ensuring that performance metrics align with sustainability goals and enabling timely interventions to prevent breakdowns.

Focusing on modular construction, digital twins, and IoT technology enhances project management by providing real-time virtual representations of physical assets, which leads to better decision-making and increased efficiency.

These technologies improve logistics and manufacturing by tracking modular components from production to installation, ensuring timely delivery and reducing delays. 

THE DEVELOPER DILEMMA 

By adopting modular construction, developers can not only meet high-quality standards but also ensure faster, scalable construction with minimal waste, adds Hijazi. Smart materials are reshaping the durability and energy efficiency of modular structures, which are gaining popularity in Saudi Arabia’s real estate projects. These materials, such as self-healing concrete and phase-change materials, enhance structural longevity while reducing maintenance needs. 

Collectively, these advancements contribute to sustainable urbanization, economic diversification, and enhanced project delivery capabilities. Meanwhile, integrating smart technologies and materials fosters a more adaptive, data-driven approach to construction and facility management.

BUILDING GREEN 

Henshaw believes that buyers notice the final product’s overall quality and the cost of enjoying the space. He adds, “In our case, with our destination so remote, our residential products can be constructed with a high level of quality, which is required for our high-end buyers looking for luxury.”

Modular construction also allows for more complex and visually interesting forms and compositions. With interior pod modules, almost any aesthetic can be achieved, allowing for flexibility in offerings.

He also highlights that they are focused on creating healthy and energy-efficient spaces designed with concern for the environment and promoting well-being. He explains, “Residential buyers in particular, are very savvy today. Sustainable practices are expected and not an option.”

The advantage of modular construction is that elements can be built using sustainable materials and practices that may not be readily available in remote settings. Additionally, there is less site impact with modular construction, especially in remote and environmentally sensitive areas like the Red Sea destination. All these construction benefits help protect the environment, fostering sustainable communities.

However, Alassafi adds that most clients have different perspectives on adopting modular buildings. The most common observation from clients is the limitations of some modular building technologies to accommodate their preferences, a shortcoming that is particularly visible in the residential industry.

He says, “We are seeing the tip. There’s a growing client’s mind-shift change.”

BEAUTY VS. BUDGET

Modular construction uses more engineers than architects, says Alassafi. He adds, “However exaggerated this may sound, I would say this is the first challenge.”

Engineers in modular buildings are adept at cutting corners to save time and money while fulfilling the intended purpose. However, aesthetics has not received the same level of importance.

However, Henshaw believes that innovation in modular design has the potential to significantly raise property values, particularly through technology and luxury.