OLUFEMI ADEDAMOLA OYEDELE
Olufemi Adedamola Oyedele, MPhil. in Construction Management, managing director/CEO, Fame Oyster & Co. Nigeria, is an expert in real estate investment, a registered estate surveyor and valuer, and an experienced construction project manager. He can be reached on +2348137564200 (text only) or femoyede@gmail.com
Businesses are set up to fill the demand-gap of the people for products, goods and services. According to reports, prefab home manufacturers control $90 billion worth of modular-homes market around the world. But a few companies that you would not expect to have a share in this market are already a player in the ever-growing trade, following the footsteps of USA-based Clayton Homes, the biggest prefab homes manufacturers. They are seriously innovating everyday and their projects range from temporary housing for refugees to modest houses for city residents, rural dwellers and billionaires’ luxury homes and this indicates that prefab manufacturing is set to become more popular. Prefab house manufacturers use such materials as aluminium sheets, steel plates, timber, converted waste materials, plastic, particle boards, light concrete etc. They are growing in number and volume of business, everyday!
IKEA Systems B.V., trading as IKEA, is a Swedish multinational conglomerate that designs and sells ready-to-assemble furniture, kitchen appliances, decoration, home accessories, and various other goods and home services. IKEA was started in 1943 by Ingvar Kamprad and currently legally headquartered in the Netherlands. IKEA has been the world’s largest furniture retailer since 2008. The brand used by the group is derived from an acronym that consists of the founder’s initials, and those of Elmtaryd, the family farm where the founder was born, and the nearby village Agunnaryd (his hometown in Smaland, southern Sweden). IKEA has restaurants in its branches to cater for the food needs of customers, because “Hungry customers buy less”!
The group is primarily known for its modernist furniture designs and its immersive shopping concept, based around a showroom of decorated room settings, in which customers can interact with the available articles onsite. In addition, the firm is known for its attention to cost control and continuous product development, notably, the ready-to-assemble model of furniture sales, and other elements which have allowed IKEA to establish lower prices than its competitors. As of September 2023, there were 462 IKEA stores operating in 59 countries and in fiscal year 2018, €38.8 billion ($45.82 billion) worth of IKEA goods were sold.
Sweden leads the world in prefab construction uptake as about 80 percent of detached homes in Sweden use prefabricated timber elements. It is not surprising that Sweden’s largest retailer (IKEA) has developed a range of products as a prefab home manufacturer too. The most affordable and innovative is not a regular house but a refugee shelter for $1250. The “Better Shelter” is made with flat-pack components, equipped with a solar panel, and can be assembled by four people in four hours. Because they’re secured to the ground and have a locking door, they provide significantly more security than a conventional tent. For this, IKEA won the 2016 Beazley Design Prize. For regular consumers, IKEA partnered with US firm Ideabox to make the flat-pack “Active home”. The house is designed around IKEA interior fixtures and products with the help of the company’s designers. Ideabox manufactures the structure itself. It goes for around $86,000.
When you ask most people about Toyota, they will rather tell you it is an auto manufacturing company from Japan. But Toyota Motors Corporation, as at today, has the world’s most developed prefab home market. For economic and cultural reasons, Japan has had a handful of major prefab home manufacturers since the 1960s. Their primary draw over conventional construction is quality rather than cost. While Toyota is not one of the leading players in the industry, the auto company has been building homes since 1975. While Toyota homes generate just a fraction of the corporation’s total revenue (in 2008 it was 0.5% of $262 billion), that does not mean they have not put out some seriously cool products. Their modular homes, which go from $200k to $800k, can be assembled in less than 45 days and come with a 60-year warranty. In line with Toyota’s recent emphasis on environmental friendliness, they aim to build sustainably with three principles: using environmentally sustainable materials, reducing waste during the construction process, and partnering with green businesses for production and supply.
Tesla was incorporated in July 2003 by Martin Eberhard and Marc Tarpenning as Tesla Motors. The company’s name is a tribute to inventor and electrical engineer Nikola Tesla. In February 2004, Elon Musk joined as the company’s largest shareholder and in 2008 he was named CEO. Tesla Homes is a premier Smart, Green and Healthy investment and development firm, with a focus on sustainable and disruptive technology investments, as well as development, renovation and construction of residential single and multi-family homes and apartment complexes. Tesla Homes invests in emerging market opportunities and value-add acquisitions across the US, Central America and Europe, with the very best and most reputable private equity partners. Elon Musk, with his billion dollar fortune, has introduced the Tesla home, a fully furnished residence. To set an example, he sold his own 50 million dollar house to move into a tiny Tesla home, 170 miles, south of Austin.
Muji (Mujirushi Ryohin) is a Japanese retailer which sells a wide variety of household and consumer goods. The Japanese retailer is known for its minimalist design and focus on waste reduction. Last year they made headlines by announcing a competition to find a test resident to live rent-free in their new “Window House” prototype for two years. The prototype itself is two stories high and has 80 square metres of floor-space, but a Window House can be altered and reassembled to fit lots of different shapes and sizes. It is Muji’s largest model, but not its first. In 2014 the company launched a 15-foot-wide three-story prefab perfect for Japan’s disposable home culture. It sells for just $180,000. They also came out with a line of Muji Huts – three cabin-like structures more suited to vacationing than permanent residency. They reportedly cost $25,000 – $40,000.
Business should not stop looking for new grounds to break. IKEA food centres, in the beginning, were not meant to be profit centres. Their main goal was to increase footfall and extend their customers’ visits. But, today, IKEA’s food business makes $2.5 billion in sales annually! McDonald Restaurants did not set out as a real estate business. Today, according to reports, McDonald’s earned over $7.3 billion in rental income in 2023 from its real estate holdings. This represents 63.5 percent of the revenue it generated from its franchisees this year. And it represents 38 percent of the company’s overall revenue, making real estate the biggest money-maker in its food value-chain business. Toyota homes is poised to benefit from the increasing growth of the prefab home business in 2024. The Asia-Pacific Prefabricated Housing Market is anticipated to register a compound annual growth rate (CAGR) of more than six percent over the forecast period. The market is driven by the increasing demand for housing and cost-effective construction in the region. Furthermore, the market is driven by the advancement in technology in the construction of houses and sustainability.
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