Driving forces

IN THE WATERPROOFING AND CONSTRUCTION MARKET

1 DEMOGRAPHICS AND ECONOMICS

GDP trend and political factors

The waterproofing and construction market in general follows the GDP trend. A strong GDP growth benefits the broad construction industry with more construction starts and higher volumes, weaker periods mean greater focus on maintenance and renovations. In periods of lower activity, public funding for construction projects has been common to stimulate the economy. Higher uncertainty in the geopolitical situation can lead to a change in the approach to state support and financing, but also to postponements and delays as well as changes in strategies. The GDP growth may also be affected by pandemics such as Covid 19.
The EU’s set climate target of zero emissions by 2050 and the EU’s Green Deal is expected to also drive the need for investments for increased sustainability in properties with a focus on reducing the climate footprint and energy efficiency.
The demographic development, with an increase in young and old age groups, means that the demand for community properties is expected to increase significantly in the coming decades.

Maintenance and renovation

Maintenance and renovation of properties, especially the waterproofing layers, are less cyclical thus not normally affected by a recession. Neglected maintenance, especially of the waterproofing layers, leads to costly consequences, which is an important driving force in ensuring ongoing monitoring and maintenance. A growing property portfolio thus leads to a growing market. According to the European Commission, about 11 percent of the EU building stock undergoes some form of renovation annually, of which 0.4-1.2 percent undergoes some form of renovation that affects energy performance.
The EU’s Green Deal is also aimed at renovating existing properties with new financing solutions within the EU’s investment program to improve the energy efficiency. According to assessors, the rate at which buildings are renovated with regard to energy performance must at least double in order to reach the set climate targets.

Urbanisation

Continued urbanization driven by housing shortages, also leads to an increase in commercial and community properties. In the Nordic countries, the public sector accounts for a significant share of construction investment, which contributes to a more levelled demand in a recession.

2 SUSTAINABILITY AND RESPONSIBILITY

Sustainability

The World Economic Forum has listed following as the most significant risks in terms of probability and impact; extreme weather, failed climate action and lost biodiversity.
There is a growing demand for sustainable building and infrastructure solutions, defined as green building materials. The focus is on a reduced climate footprint, increased endurance to climate change (from increased precipitation and flood risks), industrial symbiosis (reuse of materials) and energy-efficient and renewable materials.
Biodiversity and an improved microclimate are important components in cities, which benefits the human health and well-being while strengthening the biodiversity. This can be achieved through green infrastructure, ie green roofs, vegetation solutions and interconnecting green areas.
Renewable electricity production with increased solar cell installations also drives demand for installation services and technical solutions.

Financing for sustainable investments

In addition to publicly funded investment programs, green bonds are a growing phenomenon, often issued by real estate companies, of which one purpose is aimed at measures that increase the sustainability of real estate. This may involve energy efficiency or climate adaptation.

Competition for talent

Being able to attract and retain well-educated and competent employees is crucial for the competitiveness of many industries, including the construction industry. Employees with broad experience and different backgrounds
create conditions for new insights and methods as well as strong customer relationships.

Taking responsibility

Issues relating to responsibility of the environmental impact, business ethics and control of both the own organization and the external supply chain are becoming increasingly important and are a decisive factor in how different stakeholders assess the business.

3 TECHNICAL DEVELOPMENT

Building materials with better durability performance

There is a constant development in increasing the sustainability performance of building materials. The development is also aimed at lower climate footprints and better insulation properties.

DigitizationThe construction industry has begun a significant and necessary digitization process, which will continue for years to come. The digitization affects all parts of the value chain, from purchasing, design and manufacturing to how products are marketed and the development of new services in the construction and maintenance market. This means shorter lead times, less stock and lower costs, as well as an increased need for skills development for employees, designers and customers.

Prefabrication

Cost and sustainability requirements drive the demand for prefabricated building elements.