Rebuild

Rebuild: Leave no waste behind in construction industry

Johnathan Strope

Luc Fellicio

Amr Yafi (M#: 03758246)

Pascal Higler

Technical University of Munich

(SOT82700, SOT86700) EuroTeQ Collider - Leave no Waste Behind

Dr. Jürgen Hollatz, Dr. Beate Schlageter

June 15th, 2022

Rebuild 2

Abstract

In Europe, construction of the built environment uses up to 50% of material resources per year

(Bourguignon, 2018) and represents around 36% of waste flows by weight (Interreg Europe,

2021). The size and significance of these resources makes it valuable to focus on new strategies

to reduce this impact. New targets and goals for construction waste have been proposed by the

European commission in the Circular Economy action plan (European Commission, 2020),

however, due to the heterogeneous waste management practices across European States, novel

solutions that consider the full value chain of the construction industry are needed. This report

provides an overview on the different waste streams generated in construction/demolition

activities and describes how our solution (Rebuild) was developed.

Keywords: Circular Economy, Green Construction, Sustainability, Waste Management

Rebuild 3

Table of Contents

Abstract...................................................................................................................................................... 2

Acknowledgment..................................................................................................................................... 4

Rebuild: Leave no waste behind in construction industry ......................................................... 6

1.1 Problem Statement ............................................................................................................................. 6

1.2 Methodology .......................................................................................................................................... 6

2 Introduction ..................................................................................................................................... 8

2.1 Construction & demolition waste anatomy ............................................................................... 8

2.2 Different Stakeholders within the construction industry .................................................... 9

2.3 Sustainability rating systems in Europe ..................................................................................... 9

2.4 Construction and demolition waste regulations................................................................... 10

3 Problems and challenges within the industry .................................................................... 11

3.1 Challenges within the industry .................................................................................................... 11

4 Solution ........................................................................................................................................... 13

4.1 Solution approach ............................................................................................................................ 13

4.2 United Nations sustainable development goals .................................................................... 13

4.3 Solution “Rebuild” ............................................................................................................................ 14

4.4 Projected impact ............................................................................................................................... 16

4.5 Commercial feasibility .................................................................................................................... 17

5 Conclusion ...................................................................................................................................... 17

References ............................................................................................................................................... 18
Rebuild 4

List of Figures
Figure 1: Construction activity & respective waste generation contribution rate (EPA, 2021) ..... 9

Figure 2: Impact throughout different time periods ...................................................................... 16

List of Tables
Table 1: List of experts interviewed ............................................................................................... 7

Table 2: Construction & demolition waste composition (Coronado et al., 2011, 211) .................. 8

Table 3:List of the most representative sustainability rating systems within the EU (Cordero et

al., 2019, 66) ................................................................................................................................. 10

Table 4:Solution proposal business model ................................................................................... 16

Table 5: Financial model projection ............................................................................................. 17

Rebuild 5

Acknowledgment

First and foremost, the authors would like to thank our advisors, Dr. Jürgen Hollatz, and Dr.

Beate Schlageter. They have been continuously supportive since the first day we started working

on the Euroteq project.

The authors would also like to thank all the experts interviewed, for dedicating time to share

their insights and experience, and finally the authors would like to thank Veronica Becker, Dr.

Stefan Wurster, and the full team of Euroteq Collider for organising such an interdisciplinary

challenge and making sure that we have the right environment to tackle the waste problem.
 Rebuild 6

Rebuild: Leave no waste behind in construction industry

Construction of the built environment consumes up to 50% of material resources in Europe

(Bourguignon, 2018) each year and accounts for roughly 36% of waste flows by weight (Interreg
Europe, 2021). Because of the scale and importance of these resources, it's important to concentrate
on new ways for reducing their influence. Although the European Commission established new
guidelines and goals for construction and demolition waste in the Circular Economy action plan
(European Commission, 2020), novel solutions that encompass the entire value chain of the
construction industry are required due to the disparities in waste management practices among
European countries. This study gives an overview of the many waste streams generated during
construction and demolition projects, as well as how our solution (“Rebuild”) came to be.

1.1 Problem Statement

In the multiple stages of construction, demolition, and renovation activities, the construction
sector generates a significant amount of waste. A significant percentage of this material is
eventually disposed of, largely at landfills and illicit dumpsites. Economists and
environmentalists are becoming increasingly concerned about the growing amount of loss that
occurs from inadequate building process management and the ineffective waste management.
Multiple studies across the European Union have found that at least 10% of the primary
construction materials purchased end up as waste due on-site mismanagement (Gamage et al.,
2013). Moreover, waste generated from construction activities accounts for as much as 36% of
the total waste generated in Europe.
Many materials can be recovered, and their value retained by proper interventions in the
construction materials cycle, ensuring that their usage is extended through applications such as
reuse and recycling. Although this is intuitive, major challenges in impacting this industry
include raising awareness toward waste minimization, creating demand for secondary
construction materials, and developing a marketplace for secondary construction materials to
recover waste and ensure a sufficient supply of materials to construction projects.
1.2 Methodology

This project was conducted using multiple information streams. The first was gathering
information through literature review from different sources. The second was conducting expert
Rebuild 7

interviews leveraging the network of the team members. The experts listed in table 1 were
consulted during the research.

Name Profession

Jason Modemann Co-Founder & CEO at Mawave Marketing

GmbH

Jorge Felicio Co-owner at Reversible Corners Lda (a real estate

development company)

Peter Loeffler Head of Innovation & Industry Affairs at Siemens

Switzerland Ltd

Wolfgang Hartl Real Estate Developer

Daniel Felicio Head at Siemens Advanta Solutions

Ghina Annan Senior Sustainability Specialist at Stantec

Jad Atoui Material Handling & Logistics Consultant at Dar

group

Sean Nolan Business Development & Project Manager at

Concular

Hadi Mamoun Associate - Senior Mechanical Engineer at Dar

Group

Joe Nassar Engineering Sales Representative at Fluoroseal

Table 1: List of experts interviewed
 Rebuild 8

2 Introduction

2.1 Construction & demolition waste anatomy

Understanding the different types of waste and phases during which it was generated during
construction and demolition will help assess the best approach to tackle this problem.
Construction & demolition waste (C&DW) can have a wide range of compositions based on the
country it was generated (Hendriks & Janssen, 2004). C & DW compositions in several European
countries are listed in table 2, this composition differs significantly from one country to another.
For example, Metal is the predominant component in C&DW in Estonia, and mineral waste in
the rest of the states, which has a great potential to be recycled and used as secondary materials.

Czech
Waste Type (%) Netherlands Denmark Estonia Finland Spain Germany
Republic

40 32 17 33 33 12 70
Concrete

25 8 - - 35 54 -
Masonry

2 - - - - 9 -
Other mineral
waste Total
67 40 17 33 68 75 70
Mineral waste

26 24 9 - - 5 27
Asphalt

2 - - 41 - 4 -
Wood

1 - 40 14 - 3 0.4
Metal

- - - - - 0.2 -
Gypsum

- - - - - 2 -
Plastics

7 36 34 12 32 12 3
Miscellaneous
Table 2: Construction & demolition waste composition (Coronado et al., 2011, 211)
Rebuild 9

Different types of waste are generated from different phases during construction; however, each
activity contributes differently. Figure 1 presents different construction activities and their
respective contribution to waste generation.

Figure 1: Construction activity & respective waste generation contribution rate (EPA, 2021)

2.2 Different Stakeholders within the construction industry

Different stakeholders in the construction industry, the below list the typical main players
in any active project
● Owner: The main investor who launched the construction activity
● End-user: User of the building after construction completion
● Design Engineer: Design & plan the building
● Contractor: Build and install the building
● Suppliers: Provide all the materials needed for construction activities
● Service Provider: Responsible for building maintenance & operations
2.3 Sustainability rating systems in Europe

Europe has a dynamic sustainable rating ecosystem; these green building rating systems
(GBRS) are responsible to improve the environmental performance during their whole
lifetime. In fact, this is a response by policymakers with the goal of organising GBRS
ecosystems around the world, particularly in the EU. According to various sources, there
are currently around 600 GBRSs in operation (Mattoni et al., 2017). In the EU there are
currently over 37 foreign and 54 European certificates in use in the European union
(European Commission, 2013). Table 3 shows some of the different sustainability rating
systems operating in European states.
Rebuild 10

Table 3:List of the most representative sustainability rating systems within the EU (Cordero et al., 2019, 66)

2.4 Construction and demolition waste regulations

The applicable regulations for construction and demolition waste are mainly driven from
two types of sources. The first source is the European Commission guidelines, these
guidelines are non-binding and aim to have 70% of C & DW recycled by 2020 (European
Commission, 2018). The second source of regulations comes from local governing entities
and these regulations usually differ from one country to another. In the case of Germany,
the following list of regulations target C&DW.
● The Waste Management Act (KrWG) that was enforced in February 2012, is
inspired from the European waste framework directive (EC/2008/98), and aims to
recycle at least 70% of disposed materials by weight (Bundestag, 2012).
● The German Supply Chain Act, the law will go into action in 2023 for
approximately 600 major corporations (3,000 & more employees), and in 2024
for another 3,000 organisations (1,000 & more employees) (Bundestag, 2012).
Companies must guarantee that social and environmental standards are followed
Rebuild 11

at all levels of their value chain, including by suppliers of all sizes and in foreign
countries. The law establishes mandatory reporting on compliance with due
diligence responsibilities, as well as consequences for failure to comply
(Bundestag, 2021).
3 Problems and challenges within the industry

3.1 Challenges within the industry

The construction industry faces a lot of challenges to become truly sustainable. After
interviewing many experts, the following challenges can be listed below
● The industry is fragmented
Significant limitations to waste management have been discovered in the
construction industry, which come from a lack of integration within the
project team. Improving coordination between construction industry
partners will boost productivity while also increasing effectiveness and
efficiency.
● Lack of transparency
Companies must be aware of what is going on upstream in the value chain
and convey this information to be transparent. The reason why contractors/
developers do not act transparently is because they feared that disclosing
too much information might jeopardise their competitive edge or make them
vulnerable to criticism (Bateman & Bonanni, 2019). Another issue is that
necessary documentation, such as information concerning supply chain
source activities, may not be found, or if it is, may be inaccurate. Finally,
the return on investment in openness does not always meet immediate
needs.
● Lack of awareness of new technologies & sustainable materials alternative
According to the literature, there is a major lack of knowledge throughout
the supply chain on environmental issues in general.
● Higher cost to reduce waste
Rebuild 12

It is tough to persuade industry players to personally incur higher cost to

reduce or eliminate waste generated, since the industry is highly
competitive and is operating on low margins.
● Building owner’s attitude
Investors usually want to lower the cost of construction as much as possible,
usually clients will select tenders with the lowest bidding price and a proven
track record.
● Materials shortages
Due to Covid19 and the Russian war with Ukraine, a lot of materials are
unavailable and if they are, suppliers now shorten offer periods to one day,
because prices vary so drastically from day to day.
● The industry is still analogue
The construction industry is known for being not very digitised, but what
we heard from experts shocked us. There are factories not even having
websites. So, this results in contractors paying premiums to supply chain
experts to have a solid network of producers and get competitive pricing.
● Insufficient demolition time allowed
Insufficient time given for deconstruction and meticulous packaging of
reusable goods - the length of time required to dismantle can be unpleasant
when additional expenditures or income loss on a replacement building are
incurred due to a prolonged schedule of activities. There could also be a
time limit imposed by the expiration of a planning approval. (Hobbs et al.,
2017)
● Reliability of reused materials
One of the most significant impediments to repurpose, particularly for
structural materials, is a reluctance to utilise items without certification of
validated performance. Frequently, there is little documentation about the
product's origins or how long it has been used in a certain application. This
implies that when considering possible reuse applications, the 'worst case
scenario' is usually used. Performance testing is costly, and it necessitates
the disposal of samples to avoid the possibility of continued usage. These
Rebuild 13

expenses will be applied to the product/price, material's and they may

outweigh any savings from reuse. (Hobbs et al., 2017)

4 Solution

4.1 Solution approach

A suitable solution to increase the sustainability of the construction industry and to reduce
waste generation we must consider the following parameters
● Material Reusability
Accelerate the market growth of materials containing a high amount of post-
consumer materials.
● Financial incentives
Create a marketplace for sustainable materials to scale up production to get
more competitive prices. Also, a lot of materials in this industry are ordered
and then just lie around on construction sites to never be used. We want to
provide a secondary marketplace for those materials.
● Accessibility
Small scale businesses often have innovative technology. We want to be a
catalyst and shine a spotlight on those materials.
● Reliability:
We need a certification and quality assurance process to ensure the integrity
of salvaged materials sold.

4.2 United Nations sustainable development goals

The United Nations also has established sustainable development goals in 2015 as a
worldwide call to action to safeguard the environment, end poverty, and ensure that
everyone would live in peace and prosperity by 2030 (Trankmann, 2015). The below listed
goals are considered by the authors while developing “Rebuild”.
● Goal 11: “Make cities and human settlements inclusive, safe, resilient and
sustainable” (United Nations, 2015)
Rebuild 14

● Goal 12: “Ensure sustainable consumption and production patterns” (United

Nations, 2015)
● Goal 15: “Protect, restore and promote sustainable use of terrestrial ecosystems,
sustainably manage forests, combat desertification, and halt and reverse land
degradation and halt biodiversity loss” (United Nations, 2015)
● Goal 17: “Strengthen the means of implementation and revitalise the global
partnership for sustainable development” (United Nations, 2015)

4.3 Solution “Rebuild”

To tackle the waste problem in the construction industry, we are proposing a Marketplace
for sustainable material for the construction industry and a secondary marketplace for
reused/repurposed construction materials. A summarised solution model is listed in Table 4

Category Details

Build and maintain a platform to list sustainable construction

materials

Build and maintain a platform to list reused/repurposed

construction materials
The main activities
Build and maintain a tender/bidding platform for sustainable
of Rebuild procurement (mainly for large projects)

Ensure a proper certification mechanism for repurposed

construction materials

Track construction projects throughout their lifetime with proper

documentation

Transparency

Digitalization
Value Proposition
Accessibility

Transaction Protection
Rebuild 15

Reliability

Suppliers

Contractors
Customer Segments
Design Engineers

Building Owners

Door to door (due to the nature of the industry), our focus will be
project based and not client based
Market Entry Industry events (conferences and seminars)
Channels

Social Media targeted marketing

Suppliers

Regulatory bodies (i.e., green building rating associations)

Key Partners Industry Experts

Relevant proptech start-ups (ex: Concular, building radar)

Marketing Agency

Website Operation & Maintenance

Administrative activities
Cost Structure
Marketing & business development

Research and market analysis

Sales Commissions
Revenue Streams
Rebuild 16

Premium Listing Fees

Subscription fees

Data Analytics & Market Insights

Table 4:Solution proposal business model

4.4 Projected impact

In the EU 2,3 Billion Tons of waste are produced each year. 36% of that, so approximately
800 million tons (European Commission, 2022), is from construction materials. Products
sold on our marketplace must consist at least 70% from post consumption materials. So, if
we can get a 4% market share, which we believe we can get after 4 years, we would reduce
approximately 23,4 million tons of waste annually. Which would be 400kg of waste saved
for every person living in the EU annually. (Eurostat, 2022)
For CO2, 250 million tons that are annually emitted from construction materials in the EU
(Eurostat, 2022) therefore at 4% market share we would reduce 7 million tons. When we
scale up and get more market share – for example 30% - this impact will be much higher
moving quickly towards 200 million tons of waste and over 50 million tons of CO2.
Other than the economic and ecological impact projected, figure 2 shows the impact
“Rebuild” proposed throughout different time terms.

Figure 2: Impact throughout different time periods

Rebuild 17

4.5 Commercial feasibility

To assess the commercial feasibility, we conducted a financial projection with help of

industry experts. Table X shows a simplified financial model which indicates that we can be
profitable starting the third year, the following assumptions are made,
● The size of the global sustainable construction material market is € 280.5 Billion
and is growing with an average growth of 11.06% (Research and Markets, 2022)
● A 5% Sales commission is assumed and is considered as the only revenue stream
● An average order value of € 7500

Key Metrics

Year Market Share Orders Gross revenue Net revenue Net revenue
accumulated

2023 0% 0 0€ -1,000,000 € -1,000,000 €

2024 0.1% 880 6,600,000 € -1,220,000 € -2,220,000 €

2025 0.5% 4900 36,500,000 € -860,000 € -3,070,000 €

2026 2% 21500 161,000,000 € 4,350,000 € 1,280,000 €

2027 4% 47350 355,000,000 € 12,250,000 € 13,500,000 €

Table 5: Financial model projection

5 Conclusion

In Europe's effort to achieve sustainable construction growth while minimising

environmental effect, the construction industry is both part of the problem and the solution.
In the pursuit of greater efficiency and sustainability, innovation is critical. Even though the
EU has previously launched various efforts to promote innovation in the building sector,
overall innovativeness and productivity indexes in the construction sector remain low when
compared to other industries (McKinsey, 2020). Therefore, we propose “Rebuild” as part of
the solution to achieve a more sustainable construction industry. “Rebuild” tackles major
challenges in the construction sector and hopes to elevate the industry to a more sustainable
one.
Rebuild 18

References

o Bateman, & Bonanni. (2019, August 20). What Supply Chain Transparency Really
Means. Harvard Business Review. Retrieved June 14, 2022, from
https://hbr.org/2019/08/what-supply-chain-transparency-really-means
o Bourguignon, D. (2018). Material use in the European Union: Towards a circular
approach. European Parliament. Retrieved June 7, 2022, from
https://www.europarl.europa.eu/RegData/etudes/BRIE/2018/625180/EPRS_BRI(2018)62
5180_EN.pdf
o Bundestag. (2012). Act Reorganising the Law on Closed Cycle Management and Waste.
BMUV. Retrieved June 13, 2022, from
https://www.bmuv.de/fileadmin/Daten_BMU/Download_PDF/Abfallwirtschaft/kreislauf
wirtschaftsgesetz_en_bf.pdf
o Bundestag. (2021, July). Gesetz über die unternehmerischen Sorgfaltspflichten zur
Vermeidung von Menschenrechtsverletzungen in Lieferketten (LKSG).
Bundesgesetzblatt. Retrieved June 13, 2022, from
https://www.bgbl.de/xaver/bgbl/start.xav?startbk=Bundesanzeiger_BGBl&jumpTo=bgbl
121s2959.pdf#__bgbl__%2F%2F*%5B%40attr_id%3D%27bgbl121s2959.pdf%27%5D_
_1655132974205
o Business Wire. (2022, April 7). Global Green Building Materials Market (2022 to 2027) -
Industry Trends, Share, Size, Growth, Opportunity, and Forecasts -
ResearchAndMarkets.com. Business Wire. Retrieved June 14, 2022, from
https://www.businesswire.com/news/home/20220407005584/en/Global-Green-Building-
Materials-Market-2022-to-2027---Industry-Trends-Share-Size-Growth-Opportunity-and-
Forecasts---ResearchAndMarkets.com
o Cordero, Melgar, & Márquez. (2019). Green Building Rating Systems and the New
Framework Level(s): A Critical Review of Sustainability Certification within Europe.
Energies, (13), 66.
Rebuild 19

o Coronado, Dosal, Coz, & Viguri. (2011). Estimation of Construction and Demolition
Waste (C&DW) Generation and Multicriteria Analysis of C&DW Management
Alternatives. Research Gate, 211.
o Deloitte. (2015, September 2). Construction and Demolition Waste management in
Germany. Europa. Retrieved June 11, 2022, from
https://ec.europa.eu/environment/pdf/waste/studies/deliverables/CDW_Germany_Factshe
et_Final.pdf
o EPA. (2021, May 18). Sustainable Management of Construction and Demolition
Materials | US EPA. US Environmental Protection Agency. Retrieved June 12, 2022,
from https://www.epa.gov/smm/sustainable-management-construction-and-demolition-
materials
o European Commission. (n.d.). Waste and recycling Construction and demolition waste.
European Commission. Retrieved June 12, 2022, from
https://ec.europa.eu/environment/topics/waste-and-recycling/construction-and-
demolition-waste_en
o European Commission. (2013, February 28). Open to all: free online tool to assess
buildings' sustainability in development. European Commission. Retrieved June 12, 2022,
from https://ec.europa.eu/environment/integration/research/newsalert/pdf/319na5_en.pdf
o European Commission. (2018, September 18). EU construction and demolition waste
protocol. European Commission. Retrieved June 13, 2022, from
https://ec.europa.eu/growth/news/eu-construction-and-demolition-waste-protocol-2018-
09-18_en
o European Commission. (2020). Home Strategy Circular economy action plan. European
Commission. Retrieved June 8, 2022, from
https://ec.europa.eu/environment/strategy/circular-economy-action-plan_en
o Eurostat. (2022, January 4). Waste statistics - Statistics Explained. European
Commission. Retrieved June 12, 2022, from https://ec.europa.eu/eurostat/statistics-
explained/index.php?title=Waste_statistics
o Gamage, Osmani, & Glass. (2011). An investigation into the impact of procurement
systems on waste generation: The contractors' perspective. Research Gate.
Rebuild 20

https://www.researchgate.net/publication/267828167_An_investigation_into_the_impact
_of_procurement_systems_on_waste_generation_The_contractors%27_perspective
o Hendriks, & Janssen. (n.d.). A new vision on the building cycle. Aeneas technical
publishers.
o Hobbs, Adams, & Watford. (2017, June). Reuse of building products and materials –
barriers and opportunities Gilli Hobbs, Katherine Adams BRE, Watford, United Kingdo.
Buildings As Material Banks (BAMB2020) - BAMB. Retrieved June 14, 2022, from
https://www.bamb2020.eu/wp-content/uploads/2017/07/Reuse-of-building-products-and-
materials-barriers-and-opportunities.pdf
o Interreg Europe. (2021, 04). Construction & demolition waste generation in the EU.
Smart Waste Interreg Europe. Retrieved June 7, 2022, from https://projects2014-
2020.interregeurope.eu//smartwaste/news/news-article/11804/construction-demolition-
waste-generation-in-the-eu/
o Mattoni, Guattari, Evangelisti, Bisegna, Gori, & Asdrubali. (2017). Critical review and
methodological approach to evaluate the differences among international green building
rating tools. Renewable and Sustainable Energy Review.
https://www.researchgate.net/publication/320263879_Critical_review_and_methodologic
al_approach_to_evaluate_the_differences_among_international_green_building_rating_t
ools
o McKinsey. (2020, June). The next normal in construction. McKinsey. Retrieved June 14,
2022, from
https://www.mckinsey.com/~/media/mckinsey/industries/capital%20projects%20and%20
infrastructure/our%20insights/the%20next%20normal%20in%20construction/executive-
summary_the-next-normal-in-construction.pdf
o Research and Markets. (2022, March). Green Building Materials Market: Global Industry
Trends, Share, Size, Growth, Opportunity and Forecast 2022-2027. Research and
Markets. Retrieved June 14, 2022, from
https://www.researchandmarkets.com/reports/5562431/green-building-materials-market-
global-
industry?utm_source=BW&utm_medium=PressRelease&utm_code=xjgp7q&utm_campa
Rebuild 21

ign=1683586+-+Global+Green+Building+Materials+Market+(2022+to+2027)+-
+Industry+Trends%2c+Share
o Trankmann, B. (2015). Sustainable Development Goals. United Nations Development
Programme. Retrieved June 13, 2022, from https://www.undp.org/sustainable-
development-goals
o Udeaja, Ekundayo, Zhou, & Perera. (2013). Material waste in the construction industry: a
review of the legislative and supply chain issues, in Reuse of by products and m.
University of Salford Institutional Repository. Retrieved June 14, 2022, from
https://usir.salford.ac.uk/id/eprint/39321/1/MaterialWaste3-Draft.pdf
o United Nations. (2015). THE 17 GOALS | Sustainable Development. Sustainable
Development Goals. Retrieved June 13, 2022, from https://sdgs.un.org/goals
o Zhang, & Tukker. (2022, January). An overview of the waste hierarchy framework for
analyzing the circularity in construction and demolition waste management in Europe.
Science Direct.