We recently carried out a first exploration into ‘circular valuation’ in construction, commissioned by Platform CB’23 and Cirkelstad. This green paper collects current insights into valuing circular objects. It discusses the importance of valuing circularity, but also looks at the aspects that are important in assigning the value (which is hugely complex).
Three key takeaways
For this green paper, we held interviews with pioneers in the civil & utility and civil engineering sectors. They represent different roles in the supply chain, such as client, contractor, architect, appraiser and financier. Based on the insights from these interviews, a first attempt has been made to think in terms of different types of value (functional, technical, economic and social), and these are related to the different levels of real estate (building, shell, product, material). Here are three important insights from the green paper:
- Circular valuation is complex. The valuation of circular objects has many facets: functional value, multi-cyclical technical value and economic value. In addition, we must also look at the ecological and social value (together, the societal value). It is also not about the value now, but about the long-term value, which is difficult to predict. Expressing all of this – both quantitatively and qualitatively – in one figure is difficult.
- The value of circularity cannot be expressed only in economic terms. The concept of ‘value’ leads almost automatically to a perception of economic value, but in the circular economy we need to look at it more broadly;
- The economic valuation of circular objects can help to scale up circular construction. Despite the need to express value more broadly than in economic terms alone, the opinion is that economic valuation can help to make circular construction an attractive proposition for those who are not yet involved in it. By expressing circularity in economic terms, we may be able to reach the ‘tipping point’ of circular construction and make it the new normal.
Would you like to know more or take part in a discussion about the valuation of circular real estate? You can download the full publication (and all other Circle City green papers) via this link (in Dutch).