The Circular Buildings Coalition is an initiative of the Laudes Foundation, Metabolic, Circle Economy, EMF, WGBC, WBCSD and Arup to accelerate circularity in the built environment in Europe. It aims to address four main challenges to scale action in Europe through developing system analysis, hosting thematic round tables, advocacy, developing blueprint projects, and providing support to novel and proven solutions through regranting. The main systemic challenges are:

Financing Mechanisms

The financial sector is currently not prioritising investments in the development of the circular building industry. Key causes for this situation are a lack of well-established circular business cases, the perceived risks of circular construction, a limited presence of financial incentives for circular construction, and the lack of appropriate instruments to steer and monitor the impact of investments. This is true for investment funds looking at residual value, risk management, and value retention in the long term, as well as commercial developers, land owners, and public actors looking to minimise cost in the short- and medium term.

The coalition aims to develop and support tools that enable the financial sector to redirect significantly more funding to circular construction and asset management sectors. This requires the development of novel financial models, incentives and insights that contribute to the creation of successful business cases, allowing the financial sector to become a key player in the transition towards a sustainable built environment.

Markets & Supply chains

A market that is already under strain from extensive regulation, increasing resource costs, and supply chain failure, is rich with barriers to innovators that are trying to create the solutions that are needed to achieve circularity in their supply chains.

The coalition aims to support the building sector in increasing the application of circular materials in their construction practices by connecting the supply (reused and recycled materials) with demand at scale. We need to facilitate the development of new and better integrated infrastructure (physical, and digital), develop new value chains, lift technical and design barriers through digitalisation and drive a mindset change of critical stakeholders within the sector.

Ownership models

There is a lack of a track record of financially sustainable ownership models that align the interests of investors, building users, and developers with long-term climate and circularity goals. In the lionshare of the construction industry, the ownership of buildings and infrastructure (and the products and materials these are made of), does not lie with the organisation that’s designed and developed them in the first place. This leads to a split incentive, making sustainable and circular design difficult and financially less attractive. Developing and designing while taking the total costs of ownership (rather than the costs of construction alone) into account is rare, and as a result reuse of buildings, products and materials at end of life in the exception rather than the rule

To enable the transition to a circular building sector in Europe, new types of ownership models need to be developed and tested that supplant the current models. At the same time, new ownership models these should provide a means to better address the needs of the building's owners and users over time. These ownership models may pertain to land tenure, entire buildings, building components/construction products..  

Within the next two years, the coalition aims to identify and ‘amplify’ ownership models that facilitate circular design, operations, and management of the built environment.

Policy

The construction sector is still suffering from outdated rules and regulations that do not address circularity in the built environment, perpetuating old construction models with little regard to their environmental impacts.

As part of the systemic analysis, the coalition is reviewing European policy areas  relevant to the above-mentioned systemic challenges in order to identify leverage points critical to the acceleration of circularity in the built environment in Europe.