South Korea Construction Market Size 2024-2028

The South Korea construction market is estimated to grow by USD 48.1 billion at a CAGR of 4.37% between 2023 and 2028. The demand for modular houses is surging due to rapid urbanization, housing shortages, and the necessity for affordable housing solutions. This trend fuels market growth as modular construction methods gain traction. Dry construction techniques like prefabrication and off-site construction further drive expansion by enhancing efficiency and speed. Moreover, the rise of smart cities, aimed at advancing urban infrastructure and sustainability, amplifies the need for innovative construction solutions. These factors collectively propel the construction industry forward, fostering a shift towards more adaptable, sustainable, and efficient building practices to meet the evolving demands of urban development worldwide.

What will be the Size of the Market During the Forecast Period?

To learn more about this report, Download a FREE Report Sample

Market Segmentation

By Type

The private segment will account for a major share of the market's growth during the forecast period. The need for renovation and modernization of building structures in the private sector has increased in recent years due to the aging of existing buildings and the growing resale of properties in South Korea.

Get a Customised Report as per your requirements for FREE!

The private segment was valued at USD 120.70 billion in 2018. New housing projects reached a peak in South Korea in the last several years. Hence, public construction activities were limited in the country. This, in turn, will increase the number of private construction activities during the forecast period.

By End-user 

Based on end-user, the market has been segmented into residential, non-residential, and civil works. The residential segment was the largest revenue-contributing segment in 2023, and it is expected to retain its position during the forecast period. The growth of the segment is mainly attributed to the growing demand for housing in South Korea. Macroeconomic factors such as population growth, urbanization, and economic development have propelled the demand for residential housing in South Korea. As a result, South Korea is one of the most popular markets for residential properties worldwide.

Key Market Customer Landscape

The market research report includes the adoption lifecycle of the market research and growth, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.

Market Dynamics

The construction industry is a significant contributor to the global economy, encompassing various project types such as housing redevelopment, commercial construction, and infrastructure development. The sector's manufacturing segment includes material production, waste processing plants, and semiconductor manufacturing, among others. Transportation infrastructure projects, including roads, bridges, and water infrastructure, are crucial for economic growth. For instance, in the construction industry, water and wastewater treatment chemicals are essential for managing water quality and ensuring compliance with environmental regulations during and after construction projects. Renewable energy infrastructure is a growing sector, driven by the need for sustainable energy sources. Housing redevelopment and reconstruction regulations play a significant role in shaping industry trends. Key risks include labor shortages, material price volatility, and regulatory compliance.

The mega-project pipeline includes various development stages, from planning to execution, for projects such as office buildings, hospitality buildings, retail buildings, leisure and hospitality facilities, data center buildings, pharmaceutical plants, and manufacturing plants. The industry's participants include contractors, architects, engineers, and suppliers. Commercial construction includes office buildings, retail buildings, and leisure and hospitality facilities, which are influenced by the tourism industry. Other sectors, such as water infrastructure, hospitality buildings, and data center buildings, are also essential to the industry's growth. Carbon fiber is increasingly being used in construction due to its high strength-to-weight ratio and durability. Overall, the construction industry's trends and challenges reflect the evolving needs of various sectors and the global economy.

Key Market Driver

The growing demand for modular houses is a key driver impacting the growth of the market. Modular houses are also known as prefabricated homes. Unlike a regular house, a modular house is manufactured at an offsite location and then shipped to the required location, where it is assembled and erected. Buyers have the flexibility to incorporate their designs and specifications of the house. The demand for modular houses, also known as prefabricated homes, has been increasing steadily over the last few years in South Korea due to the increasing housing rents and the high cost of building new houses. This trend is reflected in the rising number of construction permits for residential buildings, commercial buildings, educational buildings, and social use buildings.

With the help of automation, manufacturers can achieve quicker delivery times and higher accuracy. The demand for modular houses in South Korea is expected to increase significantly, especially among single-parent families. The low cost of these houses, when compared with that of traditional houses, has increased their demand among students in large cities, where renting or buying a house is expensive. These factors will fuel the growth prospects of the market.

Significant Market Trend

The increase in public infrastructure spending is a significant trend influencing the growth of the market. The South Korean government plans to invest billions of dollars in upgrading the country's public infrastructure to drive economic growth. 

Engineering, procurement, and firms in South Korea are also involved in large housing, transportation, plant, and commercial projects. While large firms only focus on multibillion-dollar projects, SMEs play a significant role in smaller projects.  Thus, the increasing investments by the government in public infrastructure will lead to market growth during the forecast period.

Major Market Challenge

Uncertain macroeconomic conditions are a major challenge impacting the growth of the market. National and regional macroeconomic conditions have a significant impact on the industry. South Korea is recovering from the negative effects of the COVID-19 pandemic. However, uncertainty about the prevailing economic conditions will also have a negative impact on the industry, as customers may postpone spending in response to tighter credits, a decline in income or asset values, and negative financial news.

Moreover, conditions of the non-residential real estate markets, costs of labor and construction materials, access to credit, and other macroeconomic factors can also affect the demand. In addition, uncertainty regarding economic growth has delayed government subsidies, which has led to delayed or canceled construction projects. Such factors will negatively impact the growth of the market during the forecast period.

Who are the Major Market Companies?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

DPR Construction - The company offers construction services such as model-based coordination, digital fabrication, and production tracking and planning. It also offers solutions such as sustainable construction, preconstruction, special services group, self-perform workers, and others.

Hanwha Corp. - The company offers construction services such as urban development, apartments, and mixed-use building. The company also undertakes construction activities of building and housing, plants, and other civil works.

We also have detailed analyses of the market’s competitive landscape and offer information on 15 market companies, including:

• Bumwood Co. Ltd.
• Daewoo E and C
• DL Group
• GS E and C Corp.
• Gyeyang Co. Ltd.
• HL D and I Halla
• Hyundai Development Co.
• LOTTE Engineering and Construction Co. Ltd.
• MUNYOUNG Corp.
• Namkwang Construction Co. Ltd.
• POSCO
• Samsung Electronics Co. Ltd.
• SGC eTEC E and C
• SK ecoplant CO. LTD.

Technavio report provides an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies vendors into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Vendors are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.  Technavio report provides an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies vendors into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Vendors are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis. 

Segment Overview

The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.

• Type Outlook 
  • Private 
  • Public

• End-user Outlook 
  • Residential 
  • Non-residential 
  • Civil works

You may also interested in below market reports:

• Construction Materials Market Analysis APAC, Europe, North America, Middle East and Africa, South America - US, Canada, China, India, Germany - Size and Forecast
• US Residential Construction Market by Product, Type, and Application - Forecast and Analysis
• Construction Management Software Market Analysis North America, Europe, APAC, Middle East and Africa, South America - US, Canada, China, UK, Germany - Size and Forecast

Market Analyst Overview

Construction marketing encompasses various aspects of promoting and selling services, products, and solutions in the construction industry. This includes manufacturing and supplying building materials, transporting them to construction sites, and executing construction projects for different sectors. Renewable energy infrastructure, housing redevelopment, and reconstruction regulations are significant areas of focus in construction marketing. Construction activity spans various project types, including commercial, industrial, infrastructure, institutional, residential, rail infrastructure, road infrastructure, single-family housing, multi-family housing, electricity and power, oil and gas, telecommunications, sewage infrastructure, water infrastructure, hospitality buildings, office buildings, outdoor leisure facilities, retail buildings, leisure and hospitality, tourism industry, data center buildings, pharmaceutical plants, manufacturing plants, material production, waste processing plants, educational buildings, healthcare buildings, research facilities, and religious buildings. The construction industry's participants include contractors, architects, engineers, developers, and government agencies. Understanding the mega-project pipeline and development stages is crucial for effective marketing strategies.

In addition, commercial construction, industrial construction, and infrastructure construction are major sectors that require extensive marketing efforts. Marketing in the construction industry involves targeting various sectors, such as the public sector, hospitality industry, tourism industry, and more. Effective marketing strategies can help companies stand out in a competitive market and secure contracts for construction projects. The Construction Market in South Korea is experiencing dynamic growth across various sectors. Transport infrastructure projects, including highways and railways, are pivotal in enhancing connectivity and accessibility. The sector also sees significant activity in energy and utilities construction, driven by investments in renewable energy and infrastructure upgrades. Institutional construction projects, such as hospitals and government buildings, cater to expanding public services. Residential construction continues to meet housing demand amid urbanization, while investments in education facilities underscore a commitment to quality learning environments. These diverse projects highlight South Korea's robust construction sector, fostering economic development and modernization efforts.

Request a FREE PDF sample

What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the market growth and forecasting of the market between 2024 and 2028
• Precise estimation of the market size and its contribution to the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Growth of the market across Europe, North America, APAC, South America, and Middle East and Africa
• Thorough market growth analysis of the market’s competitive landscape and detailed information about companies
• Comprehensive market analysis and report on the factors that will challenge the market research and growth of market companies

We can help! Our analysts can customize this report to meet your requirements. Get in touch