Circularity in the Built Environment 2024

Value chain stakeholders BOX 5 Owners including homeowners, business entities and governments identify the need for retrofits and set specific goals for energy efficiency improvements and the use of circular materials. Investors provide funding options such as loans for retrofits and can prioritize circularity within their investment portfolios. Together, owners and investors are estimated to hold a value pool share of 5-10% in the circular retrofit market. Designers and planners such as retrofit architects design solutions to retain and salvage as many materials and as much existing structure as possible and quantify embodied and operational carbon emissions through whole life-cycle analysis. They also help ensure new buildings enable future circular retrofits. Materials and parts manufacturers such as insulation producers capture up to 35% of the value of the retrofit value pool. These stakeholders play critical roles in providing supply of circular materials and parts to meet demand. According to a 2024 survey, almost 60% of decision-makers are willing to pay an additional premium for green materials, assuming these are in deficit by 2030.37 Upgraders and renovators such as HVAC installers capture the largest value pool share of the circular retrofit market (30-45%). They are responsible for assessing existing building conditions to identify areas for improvement, implementing energy-efficient technologies and enhancing structural integrity. Distributors and logistics handlers such as lighting and controls distributors coordinate the transportation and handling of materials, including the removal and transportation of retrofit waste to reuse or recycling facilities. Waste handlers manage and recycle construction and demolition waste to ensure valuable materials are recovered and reintegrated into the supply chain, reducing environmental impact. Users can choose to occupy retrofitted buildings that have employed circular strategies. Along with users, operators such as facility managers are key stakeholders in influencing energy consumption patterns in retrofitting and are therefore crucial to realizing emissions reductions. Although circular retrofits present opportunities, they also introduce certain obstacles that must be overcome. Limited availability of data on existing built assets can lengthen the time required to run building-mapping and materials-testing exercises. Mechanisms for disassembly are not yet commonly integrated into existing buildings, making it challenging to remove or recondition materials without causing damage. And accountability for re-certification or warranty extension of existing materials is not clear across the range of retrofit stakeholders. With these points in mind, stakeholders can address seven key themes to unlock the value of circularity in retrofits (Figure 8). The relevance of each theme varies by stakeholder. High relevance indicates that addressing the theme is crucial for a stakeholder to transition to a circular value chain. For example, designers play a key role in changing design practices, while owners and investors demand these changes. Lower relevance means that, although the theme is important, the stakeholder’s role is more supportive than primary. For instance, manufacturers can indirectly support circular design by ensuring an adequate supply of innovative circular materials. Some themes are broadly relevant across the built environment while others are specific to retrofits. A detailed list of actions by stakeholder is provided in the Appendix. Circularity in the Built Environment: Unlocking Opportunities in Retrofits 19