Olli Vigren

KTH Royal Institute of Technology: Civil and Architectural Engineering

Stanford University: Center for Integrated Facility Engineering & Scandinavian Consortium for Organizational Research

Industry, scholarly, and policy interest in reusing concrete elements in construction has been on the rise. Reuse of concrete elements involves salvaging these elements from buildings condemned for demolition and reassembling them in new construction projects. This interest is largely driven by concrete’s significant contribution to global CO2 emissions, with reuse serving as an alternative strategy for reducing these emissions. There are ambitions to develop solutions that scale from pilot projects to industrial applications. Would you invest your own money in it?

Given these ambitions, there have been relatively few studies focused directly on economic feasibility. Previous research has mainly explored technical feasibility and value creation within supply chains and ecosystems. However, economic feasibility remains a significant barrier to widespread implementation. Economic feasibility generally means that a proposed solution is financially viable and cost-effective, ensuring that the benefits outweigh the costs.

Therefore, we at KTH developed a framework for analyzing the economic feasibility of concrete element reuse, presented in our research article titled “Assessing the Economic Boundary Conditions for Reusing Precast Concrete Elements in Construction.” The article is currently available by request: vigren@stanford.edu

The framework essentially considers three different value chains: standard demolition of an existing building, constructing a new building from reused concrete elements, and constructing a new building from virgin materials (Figure 1). Specifically, we ask:

1. Which economic factors influence building owners’ decisions to donate or sell concrete elements for reuse?
2. Which economic factors influence building buyers’ decisions to choose reuse over virgin materials?
3. Which economic factors influence the profitability of individual actors within the reuse supply chain and the supply chain as a whole?

These questions represent the key considerations within the industry regarding engagement in reuse activities. Building owners play a central role because they own the buildings and can therefore decide how they are demolished and what materials are used in new buildings.

Figure 1: Supply chain of reusing concrete elements.

We identify cost and profitability drivers and analyze key decisions through the lens of economic theory and cost management perspectives. Evidence suggests that owners of old buildings are likely to already have net positive incentives to pursue reuse activities over demolition. This is good news for reuse! However, these incentives are highly dependent on the country, specific context, and how costs are allocated within the value chain.

Buyers’ decisions regarding new buildings are highly context-dependent, as costs can vary significantly depending on the type of project and its organization. Key costs in concrete element reuse include deconstruction, refurbishment, storage, and transportation, while cost reduction drivers stem from savings on landfill fees, material costs, and production costs. Long-term profitability depends on economies of scale, new markets, and innovation.

Investments can already focus on the most promising opportunities, but systematic data and research on actors, costs, prices, markets, and regulatory impacts are prerequisites for informed investment decision-making. Lack of data and understanding causes uncertainty, which hampers long-term investments in reuse technologies and capacity, such as production facilities and warehouses. Can an investor expect the market for reused concrete elements to grow, and if so, when?

Finally, there is a broader need for economic feasibility studies related to circularity. Research has focused on concepts, organizational models, and technologies, but scaling these in the industry—and thereby achieving real impact—requires investors and concrete facts about money. Therefore, I will continue doing business studies on circularity and sustainability.