How Much Does a Modular Building Cost Right Now?


A McGraw-Hill construction report showed that the construction industry experienced improved efficiency due to modular buildings. Consequently, many people turn to prefabricated buildings for several advantages, including construction speed, flexibility, and sustainability.

Looking at this growing interest, you may wonder about modular building costs. The piece below covers the prices of different modular structures, enabling you to understand this expanding market better. 

How Much Do Modular Buildings Cost?

Modular buildings can cost anywhere between $50 to more than $400. The structure type, size, and customization needs determine the price tag you get. Thus, the more changes involved per square foot you want, the higher the ultimate cost will be.

You can find three primary modular categories with different price ranges, and they are:

  1. Temporary Modular Buildings
  2. Permanent Modular Buildings
  3. Custom Modular Buildings

Lets explore each of these below.

Temporary Modular Buildings

Many people often misunderstand the label “temporary” in this building type, thinking it points to the structure’s construction and design. On the contrary, it describes the building’s foundation type and its intended utility. It also refers to how the structure attaches to the foundation. Hence, temporary buildings feature an ergonomic design that lets you relocate them several times during their service life.

You can efficiently disconnect and remove the structure, making it a popular choice for enterprises requiring extra space for a limited time. Besides, these buildings incorporate steel exteriors, although most of the construction predominantly involves wooden materials.

Temporary modular buildings cost approximately $50 to $100 for each square foot. However, this tag may not necessarily include site preparation, delivery, and setup costs. Notably, many businesses prefer to lease temporary modular buildings rather than purchase them due to their short lifespan.

It is essential to note that temporary modular buildings also offer used options. These structures present affordable selections since you are not buying a new building. You also have a shorter waiting time since they are ready-made.

Another major benefit used buildings give is allowing you to see the structure before committing to it, ascertaining that you get what you want. You can also enjoy their shorter lease terms while financing one-time charges throughout the contract, including delivery, installation, and disassembly costs.

Read More: Modular Buildings Buyers Guide

Permanent Modular Buildings

Unlike the temporary options, permanent modular buildings incorporate a design to support long-term utility at the same place. Many companies also opt to buy these structures rather than lease them, with most transactions taking approximately four months from contract signing to the reception of your building. The permanent modular buildings feature wood or steel framing and come in II-B, II-A, or V-B structures.

Additionally, the permanent versions do not provide a one-size-fits-all price. Your level of customization, project complexity, and kind of structure affects your overall costs. For instance, a permanent modular building with full customization can charge anywhere from $100 to more than $300 per square foot. On the other hand, a B-type structure with a more basic design can cost from $50 to $100 for each square foot.

Read More: Modular Offices Buyers Guide

Custom Modular Buildings

Custom modular buildings allow you to work with an engineering and design team to construct a structure made to address your requirements and specifications. You can personalize various aspects of the structure according to your business needs, including siding materials, flooring, roofing materials, design, and handicap accessibility features.

The personalized details result in varying prices ranging from $70 to over $400 per square foot. You can get lower prices when making small changes to the modular structures. However, you can go as high as your budget permits if you desire more customization in your modules.  

Read More: Modular Classrooms Buyers Guide

Factors that Affect Modular Buildings Costs

Like traditional construction, modular buildings also have certain factors affecting the costs. Their prices generally involve the delivery, setup, and dismounting charges. You also get additional expenses if you create your modular building from scratch. Understanding these aspects ensures you can make better decisions before identifying the most suitable modular structure and size for your requirements.

The material types used are among the factors affecting your overall modular building costs. For example, temporary modular buildings primarily integrate wood into their structures, resulting in lower costs than their permanent counterparts. The permanent modular buildings mainly incorporate steel materials into the frames and exterior sections to deliver higher construction and maintenance costs.

You can also experience cost differences depending on whether you buy or lease the modular building. Leasing typically offers lower rates than purchasing due to its different benefits, such as flexibility, shorter-term contracts, and availability. Buying a modular building has higher expenses since it features durable and, at times, customized designs to meet your long-term demands.

Another factor influencing modular building costs is customization requirements. You can add and adjust the modules’ designs according to your preferences and needs when selecting a modular structure. Hence, more modifications demand extra expenses.  

Notably, some elements can influence the schedule and cost of modular building projects to derail your plans, including inadequate coordination and contractual disputes. Such derailments mean you waste time, resources, and labor while extending your project timeline to incur extra expenses.

Cost of Leasing a Modular Building

The structure type, customization, and project complexity determine the prices, typically ranging from $1 to $1.50 per square foot every month. As a result, your cost varies depending on your preferred lease length, building size, location, supply and demand, and one-time charges.

Your contract’s length significantly affects modular building cost, and thus it is essential to know how long you intend to utilize the borrowed space.

The provider can precisely determine your monthly rental rate when you properly estimate your utility period. Generally, shorter-term contracts have a higher monthly rate, whereas longer leases provide reduced charges.

The building size, configuration, and type determine the price you pay for your lease since different needs demand different solutions. For instance, you can expect a different price tag when choosing a modular structure containing a restroom over one that does not have one. The stackable and panelized options also have a different cost than the conventional mobile spaces.

Your location can also influence the contract terms, where it costs more to get the modular structure in an urban area than in a more remote setting. Besides, the supply and demand in your area can considerably impact your leasing costs. Modular buildings support several industries, leading to a shortage and higher price tags during the peak seasons.

Should I Lease or Purchase a Modular Building?

Aside from the modular building cost, it is necessary to consider some factors to know whether leasing or purchasing the structure is right for you. “Can I wait for the structure’s construction from the start?” “Do I want customized modules?” “How long do I need the structure?”

You want to buy a modular building if you plan to utilize the structure at another site in the future or use it for over 3 years. Conversely, it is generally advisable to lease the building if you do not own the commercial property, lack perfect credit, have a tight budget, and intend to use the structure for 6 to 36 months.

Here are some advantages and disadvantages of leasing and purchasing a modular building to aid you in determining the best option for your needs.

Pros of Purchasing a Modular Building

•    Purchasing is cheaper than a traditional construction project

•    It maximizes energy efficiency

•    Purchasing minimizes inspection hassle

•    It has a fast construction time

•    Prefabricated buildings eliminate wastage of excess materials

Cons of Purchasing a Modular Building

•    Difficulty moving and handling modules

•    Lack of storage space after use

•    Extra expenses customizing the modules for future needs

Pros of Modular Building Leases

•    It reduces responsibility for major repairs

•    Leasing is flexible and convenient

•    It offers an eco-friendly option

•    Leasing provides quick occupancy

•    It is more affordable

Cons of Modular Building Leases

•    Lower aesthetic quality on used structures

•    A design that is not fully user-specific

•    Perception issues due to historical performance

Modular Building vs. Traditional Construction Cost

Modular building and traditional construction have multiple differences, helping you find the suitable option for your budget needs. Generally, the former offers lower overall operating costs than the latter to make it ideal when you have limited financing. Modular buildings enable you to reduce expenses compared to traditional construction in three primary ways: construction time, labor costs, and tax requirements.

For instance, it can take around 60 to 90 days to complete a modular building’s construction. This speed shortens your project timeline by up to 35% compared to traditional building ventures. Modular buildings enable site development and structure construction to occur simultaneously. As a result, you experience fewer delays from interruptions such as weather conditions to speed up the construction and have lower final modular buildings cost.

In addition, you can save extra expenses via modular buildings that you would otherwise spend on energy and labor to achieve traditional construction. The reduced project timeline and interruptions let your constructors use their resources and energy optimally, lowering the on-site costs.

Aside from these, the tax ramifications of conventional construction typically depreciate over 35 years. However, tax regulations present favorable depreciation on all modular structures, qualifying for a 7-year depreciation period.

This benefit results from the modular buildings’ flexibility that enables you to disassemble, relocate, and re-install them. Therefore, the mobility allows these structures to qualify as tangible property under the MACRS (Modified Accelerated Cost Recovery System) with a shorter depreciable life.



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