As the demand for built environment grows, there inevitable question becomes do we knock down existing buildings in order to make way for new developments, or try wherever possible to utilise existing structures and materials.
A recent analysis by McKinsey and the World Economic Forum highlighted the vital role of circular retrofitting in conserving natural resources, meeting decarbonization targets, and unlocking other substantial opportunities.
According to the study, retrofitting provides a cost-effective alternative, reducing emissions by 75% and cutting costs by 77% compared to building new structures.
And in order to meet global net-zero targets, it argues retrofit market must grow from $500 billion today to approximately $3.9 trillion by 2050.
It argues reaching this target could result in a reduction of 500 million metric tons of carbon emissions annually and divert materials worth $600 billion from landfills by that date.
McKinsey partner and report co-author Sebastian Reiter said retrofitting existing building stock represents a “significant opportunity economically” and it is a “$1trillion market” in an interview.
Reiter said retrofitting can help reduce the global consumption of raw materials, material use in this sector has tripled over the last 50 years.
He added in 2020 alone, the built environment consumed 30 billion tonnes of materials, and could help with the renewable energy transition, by ensuring buildings are more energy efficient.
World Economic Forum executive committee member Fernando Gómez said we need sustainable ways to respond to a growing global demand for the built environment, and “doing it only through new construction is not an option” in an interview.
Gómez added a lot of retrofit work will be around insulation and meeting new energy efficiency standards.
“People will also want to live and work in a place that actually helps them with their own commitments on sustainability,” he told me.
Gómez said there is also a growing awareness around the value of construction materials and how to protect that value for longer periods of time, as opposed to simply tearing down existing buildings and starting again from scratch.
He added retrofitting at a larger scale will also require new ways of thinking about technology and a more systematic approach to the built environment.
“We’re going to have to create infrastructure for recycling and reuse, which currently do not exist. Financial institutions will also need new ways of thinking about the value of assets.”
McKinsey senior partner Jukka Maksimainen with retrofitting, carbon footprints are significantly smaller and construction times are also shorter.
Maksimainen added it is estimated around 80% of 2050’s building stock already exists today, and a large portion of that will need to be repurposed or remodelled to meet future needs.
Arup’s global leader of circular economy services, Martin Pauli said embracing circularity through retrofit can play a transformative role in addressing challenges like climate change in an email.
Paul added by upgrading existing building stock, energy consumption can be reduced, and people can adapt to future higher temperatures without relying heavily on carbon-intensive materials required for new construction.
“However, retrofitting still demands materials, such as insulation, concrete and steel, to enhance energy efficiency and structural integrity,” said Pauli.
“The key lies in sourcing these materials sustainably and reusing what we already have. Businesses and governments are beginning to recognize the potential of this approach but making it the global standard is imperative.”
And Timber Development U.K.’s sustainability director, Charlie law said it will be important to keep construction materials in use and operating at the highest possible value for as long as possible in an email.
Law added this this means choosing materials that are durable and demountable so they can be used, and reused, repeatedly for perhaps hundreds of years.
“Timber is a natural choice for these types of projects, he said.
“Also, due to its light weight, it can be used to extend the floorplan of an existing structure upwards, without additional structural alterations to the existing frame, increasing the overall value of the property.”