MODULAR BUILDING CONSTRUCTION IN PAKISTAN: AN EMPIRICAL INVESTIGATION OF THE DETERMINANTS OF ADOPTION IN THE HOUSING AND BUILDING SECTOR

Abstract

Pakistan is facing a serious housing shortage of 10-12 million housing units, and the demand for new housing units is around 700,000 per year, which is far more than the supply. The traditional construction approach is insufficient to meet this increasing challenge due to its long project duration, labour-intensive process, cost overruns and low productivity. While modular construction has proven to be highly beneficial in other parts of the world, such as quicker project delivery, better quality, waste reduction, and sustainability, it has not been widely embraced in Pakistan. The present study aims to explore the factors that influence the adoption of modular construction in the housing and building sector in Pakistan by examining the impact of perceived performance benefits, organisational readiness, and technological readiness on the adoption intention, and the moderating effect of regulatory and policy support. The study used a quantitative, cross-sectional research design based on the Diffusion of Innovations Theory and the Technology Acceptance Model. A structured questionnaire was used to gather data from 312 construction professionals, including developers, contractors, architects, engineers, consultants, project managers, and regulatory officials from Karachi, Lahore, and Islamabad–Rawalpindi. The data were analysed with SPSS and AMOS by descriptive statistics, Confirmatory Factor Analysis (CFA) and Structural Equation Modelling (SEM). The results show that perceived performance benefits (β = 0.41, p < .001) and organisational and technological readiness (β = 0.34, p < .001) are significant positive factors for the intention to adopt modular construction. In addition, both relationships are greatly enhanced by the presence of regulatory and policy support, which underscores the need for an enabling institutional environment to support adoption. The most significant barriers cited were high initial capital investment, limited financing mechanisms and lack of regulatory recognition, while the most significant enablers cited were public-sector demand, reduced construction time and lower material waste. The study recommends that there is a need for coordinated efforts to strengthen the organisational capability and supportive regulatory reforms such as building code recognition, government procurement programs and financing schemes that are specific to factory construction to make modular construction a reality in Pakistan. The results add to the body of knowledge on industrialised construction and offer practical advice for policy makers and industry actors interested in increasing the delivery of housing using modular construction.