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Executive Summary

In an investment landscape informed by climate-related risks, the emphasis in the commercial real estate sector on developing new buildings increasingly conflicts with achieving greenhouse gas (GHG) emission reduction targets. Even constructing the most energy-efficient building entails variable but significant upfront GHG emissions because of the resource-intensive nature of construction and the materials supply chain. Extending the life of buildings through retrofit, repair, maintenance, and adaptive reuse is a key principle of the “circular economy”. The circular economy proposes an alternative to the linear system of production and consumption characterized by “take-make-use-dispose”. This restorative and regenerative system minimizes resource use, waste, and emissions by narrowing (efficient resource use), slowing (temporally extended use), and closing (cycling) material loops.

This report provides guidance and best practices on extending the lives of existing office buildings by looking, in turn, at (a) the design interventions that could optimize an existing building for ongoing operations while improving the potential for future renovations; (b) the ways to minimize waste generated from maintenance and renovation activities and, ultimately, end of life; and (c) construction material flows and incorporation of salvaged materials into projects.

Many circular strategies are not new in Canada, but are undertaken on an ad hoc basis. Underutilized approaches such as embedding life cycle thinking into real estate decision-making, the use of digital technologies, and innovative leasing structures are ways for industry to get started on the journey to a circular economy for office buildings. These approaches make it easier for owners to include building reuse as an option for their office properties, stimulating demand for industry training programs and secondary materials markets – which exist, but not at sufficient scale.

This report also reviews a number of policies, financial measures, and voluntary programs in place in Canada that help to extend the lives of existing office buildings. Numerous models from other jurisdictions could be applied to the Canadian context to help fill gaps.

Standardization is necessary to ensure that the information and practices associated with products and buildings are consistently and accurately calculated and presented. Standards underpin building codes, but the standards landscape in Canada is underdeveloped when it comes to existing buildings and the circular economy. At the most elementary level, terms such as “restoration”, “retrofit”, “renovation”, “alteration”, “refurbishment”, and “renewal” are all used interchangeably when, in fact, they mean different things. Research for this report uncovered gaps in local and regional policies, zoning, land use and development bylaws, and building regulations; data collection and management (for existing buildings and at the industry scale for benchmarks such as life cycle costing and life cycle assessment); building information modelling standards for existing buildings; procurement standards that promote a “renovation first” approach; documentation and certification of used materials, building adaptability information and disclosure; insurance and risk management; and industry training curricula and professional accreditation.

Applying circular economy principles to Canada’s real estate and construction sectors could deliver multiple benefits, including creating new economic, investment, and employment opportunities; reducing waste and GHG emissions; enhancing natural ecosystems and urban green spaces; improving the resilience of supply chains; and providing greater equity and related social benefits. Inevitably, there are economic and environmental trade-offs and these need to be managed through the use of consensus-based analytical methods (such as life cycle costing and life cycle assessment) based on industry-accepted data.

A growing number of exemplary projects in Canada and around the world illustrate how successful renovation and adaptive reuse can maintain the functional viability of an office building while achieving economic efficiency. They offer examples for industry to build technical knowledge and for policymakers and owners to consider renovation instead of demolition for underperforming office buildings.