A Systematic Literature Review of Modular Construction and Circular Economy: Barriers, Multifunctionality Enablers, and Systems Interactions

Abstract

Modular construction (MC) is frequently promoted as a path to circular economy (CE) outcomes in built environments, yet circular adoption and performance remain uneven. This study investigates how systemic barriers shape the implementation of circular strategies in MC. A systematic literature review combined with bibliometric mapping and systems-oriented synthesis was conducted using 124 Web of Science records published between 2011 and August 2025. Bibliographic coupling, co-citation, and keyword co-occurrence analyses were used to characterise the field’s intellectual structure, while 30 studies were selected for thematic coding and systems mapping. Ten recurrent barriers were identified and consolidated into six clusters: technical, financial, regulatory, stakeholder and organisational, quality assurance, and institutional and knowledge-based challenges. Their relative severity was assessed across four MC-relevant circular strategies: reuse, repurposing, design for disassembly, and multifunctionality. Systems mapping revealed three reinforcing feedback dynamics involving financial, stakeholder, and supply-chain pressures, knowledge and quality assurance constraints, and regulatory and design lock-in effects that stabilise conventional delivery and constrain circular implementation. Despite being underrepresented in the literature, multifunctionality emerges as a cross-cutting leverage point for enabling adaptable modular systems. The study synthesises five implementation pathways, including adaptable multifunctional design, interoperable interfaces, digital traceability, collaborative life-cycle integration, and policy alignment, and outlines systems-derived leverage points to guide future research and practice in circular modular construction.