DEGREE PROJECT REAL ESTATE AND CONSTRUCTION MANAGEMENT REAL ESTATE ECONOMICS AND CONSTRUCTION PROJECT MANAGEMENT MASTER OF SCIENCE, 30 CREDITS, SECOND LEVEL

STOCKHOLM, SWEDEN 2020

Reuse of Construction Materials A study on how a strategic collaboration can facilitate the reuse

of construction materials

Dana Trabulsi & Milan Sofipour

TECHNOLOGY

DEPARTMENT OF REAL ESTATE AND CONSTRACTION MANAGEMENT

ROYAL INSTITUTE OF TECHNOLOGY

DEPARTMENT OF REAL ESTATE AND CONSTRUCTION MANAGEMENT

Master of Science thesis

Title: Reuse of construction materials. A study on how a strategic collaboration can facilitate the reuse of construction materials. Author(s): Milan Sofipour & Dana Trabulsi Department: Real Estate and Construction Management Master Thesis number: TRITA-ABE-MBT-20403 Supervisor: Agnieszka Zalejska Jonsson Keywords: Circular Economy, Construction Material Reuse, Strategic Collaboration, Reverse Logistics

Abstract The world’s population alongside the general consumption and use of natural resources has

grown immensely during the past decade. The construction sector is today one of the industries

that has the highest impact on the environment. Therefore, the current linear economy has to be

moved towards a circular economy which aims for material- and resource efficiency. The

concept of reverse logistics for reuse of construction material and the need for collaboration has

been identified as key areas for transitioning to a circular economy and thus has a decisive role

in reducing the construction waste. However, due to the construction industry being

fragmented, a lack of collaboration amongst real estate developers and other market actors has

been identified as a barrier for successfully implementing the reuse of construction materials.

Furthermore, the real estate developer is seen as a key actor to utilise the potential of the reuse

of construction materials by creating incentives and collaborations with other actors involved.

The aim of this paper was therefore to investigate different actor’s perspectives in the real

estate- and construction sector regarding reuse of construction materials and what the key

barriers and incentives are for them to implement it. Furthermore, by gaining an understanding

of each actor's perspective the aim was to create a framework model for how a real estate

developer can achieve a strategic collaboration with different actors to make the process of

reusing construction materials in tenant adaptation projects more efficient. This was achieved

by interviewing key actors within the real estate- and construction industry in order to get an

overall perspective on their views. Furthermore, a survey was conducted to obtain an

understanding of the tenants view on having reused construction materials in their facilities.

The results indicated that the main barriers were; a lack of incentives, lack of logistics &

recovery facilities, an established procedure for quality assuring the material & warranty issues

as well as the tenants’ perception of it. Furthermore, the results show that the real estate

developer can create different types of incentives for the tenants and involved actors in order to

facilitate the implementation of material reuse and an established collaboration. Lastly, a

framework model was presented to demonstrate how a real estate developer can collaborate

with different actors in order to get a deeper understanding of the dynamics of a potential

collaboration.

Acknowledgement

This master thesis marks the final moment for the five-year Degree Programme in Civil

Engineering and Urban Management at KTH Royal Institute of Technology in Stockholm,

Sweden. The degree project has been written within the Master’s Programme Real Estate and

Construction Management, at the School of Architecture and Built Environment and has been

conducted in the spring of 2020 in collaboration with Vasakronan AB.

First and foremost, we would like to sincerely thank our supervisors, Agnieszka Zalejska

Jonsson at KTH Royal Institute of Technology and Kubra Ayata at Vasakronan AB, whose

important input, guidance, support and commitment made this study possible.

We would also like to thank Vasakronan AB for giving us the opportunity of conducting this

study. Furthermore, we would like to thank all the participants in the interview for taking the

time to provide us with valuable inputs, reflection and thoughts in this study, despite the

ongoing pandemic. Without you, this study would not be possible.

Last, but certainly not least, we would like to sincerely thank all our loved ones for the constant

support you have given us during all these years at KTH Royal Institute of Technology.

Milan Sofipour & Dana Trabulsi

May 20th, 2020 Stockholm, Sweden

Examensarbete

Titel: Återbruk av byggmaterial. En studie på hur ett strategiskt samarbete kan främja å terbruk av byggmaterial Författare: Milan Sofipour & Dana Trabulsi Institution: Fastigheter och Byggande Master Thesis number: TRITA-ABE-MBT-20403 Handledare: Agnieszka Zalejska Jonsson Nyckelord: Cirkulär Ekonomi, Återbruk av Byggmaterial, Strategiskt Samarbete, Omvänd Logistik

Sammanfattning Världens befolkning har i samband med den generella konsumtionen samt vår användning av

naturresurserna ökat avsevärt det senaste decenniet. Bygg- och fastighetssektorn är idag en av

de industrier som har störst påverkan på vår miljö. Därav behövs en skiftning från den linjära

ekonomin till en cirkulär ekonomi som grundar sig i material- och resurseffektivisering.

Konceptet omvänd logistik för ett ökat återbruk av byggmaterial och behovet av samarbete har

identifierats som viktiga verktyg för skiftet mot en cirkulär ekonomi och därmed en minimering

av byggavfall. Då byggbranschen idag är fragmenterad har bristen på samarbete mellan

fastighetsägare och andra aktörer identifierats som en utmaning för att implementera återbruk

av byggmaterial med framgång. Vidare ses fastighetsägare som en huvudaktör som kan utnyttja

potentialen som finns kring återbruk av byggmaterial genom att skapa incitament och

samarbeten med andra involverade aktörer.

Därför var syftet med denna rapport att utreda olika aktörers perspektiv på återbruk av

byggmaterial inom bygg- och fastighetssektorn samt vad de främsta barriärer och incitament är

för att de ska implementera det. Vidare, genom att få en förståelse för samtliga aktörers

perspektiv var målet att skapa en modell för hur fastighetsägarna kan uppnå ett strategiskt

samarbete med olika aktörer för att effektivisera processen av återbruk av byggmaterial vid en

hyresgästsanpassning.

Detta uppnåddes genom att intervjua huvudaktörer inom bygg- och fastighetssektorn. Vidare

gjordes en enkät för att erhålla en förståelse för hyresgästerna syn på att ha återbrukat

byggmaterial i deras lokaler.

Resultatet indikerar på att de främsta barriärerna var; brist på incitament, logistik &

lagerhållning, en etablerad process för kvalitetssäkring & garantier på materialen samt

hyresgästernas uppfattning av det. Vidare visar resultatet att fastighetsägarna kan skapa olika

incitament till inblandade aktörer för att främja implementering av materialåterbruk samt ett

etablerat samarbete. Slutligen presenterades en modell för att åskådliggöra hur en

fastighetsägare kan samarbeta med andra aktörer för att erhålla en djupare förståelse för

dynamiken av ett potentiellt samarbete.

Förord

Detta examensarbete markerar det slutliga momentet av det femåriga civilingenjörsprogrammet

Samhällsbyggnad vid Kungliga Tekniska Högskolan. Examensarbetet har skrivits inom

mastersprogrammet Fastigheter och Byggande på skolan för Arkitektur och Samhällsbyggnad

våren 2020 i samarbete med Vasakronan AB.

Först och främst vill vi tacka våra handledare, Agnieszka Zalejska Jonsson på Kungliga

Tekniska Högskolan och Kubra Ayata på Vasakronan AB, vars viktiga åsikter, vägledning, stöd

och engagemang möjliggjorde denna studie.

Vi vill dessutom tacka Vasakronan AB för att ha gett oss möjligheten att få genomföra denna

studie. Vidare vill vi tacka samtliga som deltagit i intervjuerna samt tagit sig tiden att förse oss

med viktiga åsikter, reflektioner och tankar i denna studie, trots den rådande pandemin. Utan er

skulle denna studie inte vara möjlig.

Sist men absolut inte minst skulle vi vilja tacka våra nära och kära för det konstanta stöd ni har

gett oss under alla dessa år på KTH.

Milan Sofipour & Dana Trabulsi

20de maj 2020 Stockholm, Sverige

Table of contents 1. Introduction ........................................................................................................................................ 1

1.1 Background ................................................................................................................................... 1

1.2 Problem Formulation .................................................................................................................... 4

1.3 Purpose ......................................................................................................................................... 4

1.4 Research Questions ...................................................................................................................... 4

1.5 Limitations .................................................................................................................................... 5

1.6 Disposition .................................................................................................................................... 5

2. Literature review ................................................................................................................................ 7

2.1 Definitions ..................................................................................................................................... 7

2.1.1 Circular Economy ................................................................................................................... 7

2.1.2 Reuse of Materials ................................................................................................................. 8

2.2 Circular Economy and Material Reuse in the Construction Industry ............................................ 8

2.2.1 Identified Barriers for Implementing Material Reuse ............................................................ 8

2.3 Sustainability Effects of Material Reuse ..................................................................................... 10

2.3.1 Economic Sustainability ....................................................................................................... 11

2.3.2 Environmental Sustainability ............................................................................................... 11

2.3.3 Equitable Sustainability ....................................................................................................... 12

2.4 Reverse Supply Chain .................................................................................................................. 13

2.4.1 The Process of the Reverse Supply Chain ............................................................................ 13

2.5 Reverse Logistics ......................................................................................................................... 15

2.5.1 Barriers for Implementing Reverse Logistics in the Construction Industry ......................... 16

2.6 Identified Models in Reuse Management ................................................................................... 17

2.7.1 Summary of the Models ...................................................................................................... 21

2.7 Inter-Organisational Collaboration ............................................................................................. 21

3. Method ............................................................................................................................................. 24

3.1 Methodological Approach .......................................................................................................... 24

3.2 Choice of Respondents ............................................................................................................... 26

3.3 Reliability and Validity ................................................................................................................ 27

3.4 Ethics ........................................................................................................................................... 28

4. Results .............................................................................................................................................. 29

4.1 Current Business Models Within Reuse of Construction Materials ............................................ 29

4.1.1 Real Estate Developers ........................................................................................................ 29

4.1.2 Contractors .......................................................................................................................... 30

4.1.3 Demolition and Logistics Companies ................................................................................... 30

4.1.4 Suppliers .............................................................................................................................. 30

4.2 Construction Materials with the Highest Potential to Be Reused .............................................. 31

4.3 Barriers for Implementing Reuse of Construction Materials ...................................................... 32

4.3.1 Incentives ............................................................................................................................. 32

4.3.2 Logistics and Recovery facility ............................................................................................. 34

4.3.3 Quality Assurance and Warranties ...................................................................................... 35

4.3.4 Tenants Involvement in the Reuse Process ......................................................................... 36

4.5 Tenants View on Having Reused Construction Materials ........................................................... 37

4.6 Real Estate Developer’s Role in Encouraging Reuse of Construction Material .......................... 38

4.7 Key Factors for Initiating a Strategic Collaboration Between Different Actors .......................... 41

5. Analysis/Discussion ........................................................................................................................... 43

5.1 Influential Factors in the Reuse Process ..................................................................................... 43

5.1.1 Degree of Collaboration ....................................................................................................... 43

5.1.2 Tenant’s Perspective on Reused Materials .......................................................................... 44

5.1.3 Finding Added Value in the Existing Property ...................................................................... 46

5.1.4 Conditions to Finding and Using Suitable Reused Materials ............................................... 47

5.1.5 Logistics and Recovery facility ............................................................................................. 49

5.1.6 Real Estate Developer’s Ability to Facilitate Future Reuse .................................................. 51

5.2 Model Proposition ...................................................................................................................... 52

6. Conclusion ........................................................................................................................................ 57

6.1 Reliability and Validity ................................................................................................................ 58

6.2 Suggestions on Further Studies .................................................................................................. 59

References ............................................................................................................................................ 61

Appendix I – Disclosure of Survey ......................................................................................................... 69

Appendix II – Interview Questions for Real Estate Developers ............................................................ 73

Appendix III – Interview Questions for the Contractors ....................................................................... 74

Appendix IV – Interview Questions for the Suppliers ........................................................................... 75

Appendix V – Interview Questions for the Architect ............................................................................ 76

Appendix VI – Interview Questions for the Demolition and Logistics Contractors ............................... 77

Appendix VII – Interview Questions for the Waste Contractor ............................................................ 78

Appendix VIII – Interview Questions for the Reuse Consultants .......................................................... 79

Appendix IX – Interview Questions for the Research Institute ............................................................. 80

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1. Introduction

This chapter aims to present the background to the study, the purpose of the study as well as the research questions this study intends to answer. Furthermore, the limitations of the study are presented in this chapter.

1.1 Background The world’s population is rapidly growing. In less than a century, the world’s population has

grown by over a threefold, to a total of 7,7 billion in 2019 (Roser et al., 2020). Alongside our

increase in population, digitalisation and mass production, the general consumption in the world

has risen (Dobers & Strannegård, 2005). As the earth’s resources are limited, it is of great

importance that the resources are preserved and managed sustainably. Resource efficiency is

essential to achieve, as extraction and the production of material has an immense effect on the

environment (European Environment Agency, 2016).

There is a general consensus among researchers that the “buy, use and throw away” mentality

that we as consumers have is not sustainable (Schrader & Thøgersen, 2011). The real estate-

and construction sector is today one of the industries that has the highest impact on the

environment due to the enormous quantities of greenhouse emissions being liberated when

producing construction materials and the high amounts of waste it generates (Boverket, 2019).

During the years of 2008-2017, the real estate- and construction sector stood for 19% of all

green emission gas released in Sweden (Boverket, 2019). Furthermore, nine million tonnes of

non-hazardous waste are generated annually from the construction and demolition sector which

comprises 31% of all waste, excluding mining waste (Boverket, 2019). Material reuse is a

sustainable way to make use of construction waste destined for landfills. However, only a small

amount of construction material is currently reused, which indicates that there is plenty of room

for resource- and material efficiency in the construction industry (Miliute-Plepiene et al., 2020).

In the European Union, construction and demolition waste stands for 25-30% of all generated

waste in 2018 (European Commission, 2019). In 2008, the European Union issued a new

directive framework which aims to have 70% of all construction and demolition waste recycled

and reused by 2020. However, with the exception of a few EU countries, only about 50% of all

construction and demolition waste is currently being recycled or reused (European

2

Commission, 2018). However, the percentage rate mainly accounts recycled materials, which

distinguishes from reused materials. Recycled materials are existing materials that are turned

into raw or processed material which can be used again, normally for another function. While

reuse refers to a material product that is used again to fulfil the same function as it was intended

for before (European Commission, 2018). In order to achieve the directive framework

objective, the European Union issued a waste hierarchy which prioritises the waste management

principles in order to prevent harm against humans, environment and wildlife. see figure 1.1.

The hierarchy consists of five different management steps; prevention, preparation for reuse,

recycling, recovery and disposal.

Fig. 1.1. EU’s waste hierarchy. Figure inspired by The European Commission's waste hierarchy (2008)

Circular economy is a term well investigated by researchers’ and academics. It is designed to

benefit businesses, society and the environment. In contrast to the ‘take-make-waste’ linear

economy, a circular economy is regenerative by design and aims to gradually decouple growth

from the consumption of finite resources (MacArthur, 2013). The concept of circular economy

differs from a linear economy in the sense of replacing the “end of life” for a material as it

remains in productive use to create additional value (MacArthur, 2013). A circular economy

favours activities that preserve value in the form of energy, labour, and materials (Ellen

Macarthur Foundation, 2017). The built environment has been identified as a key target in The

European Commission policy (2018) to achieve circular economy. Furthermore, the European

Environment Agency (2016a) argues that construction and demolition is one of the five priority

areas for transitioning to a circular economy (Jones, 2018).

3

Fig. 1.2. Illustrations of the material process of linear and circular economy. Source: van der Heijden et al., 2017

There are several research papers investigating the potentials of reuse of construction materials

and how to improve the management of construction waste. However, little progress has been

made in practice to address the implementation of construction material reuse. There is a

consensus among researchers that reuse of building materials in the real estate- and construction

sector has a decisive role to play in reducing waste. Previous research has identified the concept

of reverse logistics which is a process within reverse supply chain, as an important tool in terms

of alleviating environmental issues such as material reuse in the manufacturing and construction

industry (Hosseini et al., 2014). However, some of the biggest obstacles in implementing

material reuse that need to be addressed are; limited access of secondary materials with

sufficient quality, lack of infrastructure necessary and few market actors with low incentives

for cooperation (Nußholz et al., 2019). Furthermore, the real estate- and construction sector is

fragmented and hierarchical, causing a lack of dialogue between real estate developers,

architects, designers, contractors and demolition contractors. Therefore, increasing

collaboration and networking may facilitate and expand the knowledge and understanding of

life cycle concerns in design and construction. A lack of cooperation of all parties such as real

estate developers, contractors, subcontractors, waste contractors, architects and designers are

identified amongst others, as a barrier for successfully implementing reuse of construction

materials (Nakajima & Russell, 2014).

Raw Materials

Production

Use

Waste

Raw Material

Production

Use

Reuse and Recycle

Circular Economy Linear Economy

4

Previous research in the area of material reuse have mostly been focused on the barriers and the

opportunities that arise from implementing it. However, there has been a lack of research on

how collaboration amongst different actors can facilitate reuse of construction materials and

how such a collaboration can be manifested.

1.2 Problem Formulation The real estate- and construction sector stands for a high amount of the waste produced in

Sweden. Although the European Union has established a waste hierarchy with the goal of

having 70% of all construction waste reused or recycled by 2020, only a small amount of all

construction waste is currently being reused in Sweden (European Commission, 2018). This

indicates an unutilised potential in reusing construction materials and the real estate developer

is seen as a key actor to utilise the potential of it by using its influence to create incentives for

other actors involved (Miliute-Plepiene et al., 2020; Andersson et al., 2018). The need for a

collaboration between different actors in the real estate- and construction sector has been

identified as a key driver to further facilitate the material reuse process. However, currently

there is a lack of established models which emphasises on the collaboration between a real

estate developer and different actors in the material reuse process, which is what this paper aims

to provide.

1.3 Purpose The purpose of this study is to develop an understanding of different actor’s perspectives in the

real estate- and construction sector regarding reuse of construction materials and identifying

what the key barriers and incentives are for them to implement it. Furthermore, by gaining an

understanding of each actor's perspective the aim is to create a framework model for how a real

estate developer can achieve a strategic collaboration with different actors to make the process

of reusing construction materials in tenant adaptation projects more efficient.

1.4 Research Questions The research question can be divided into three different questions;

• Which barriers exist with implementing the reuse of construction materials according

to different actors within the real estate- and construction sector?

5

• How can a real estate developer create incentives for other actors to engage in a

collaboration to facilitate the reuse of construction materials?

• How can a strategic collaboration between a real estate developer and other actors be

actualised in order to streamline the process of using reused construction materials?

1.5 Limitations To be able to conduct the study, some limitations have been made. First and foremost, this study

is centred around the real estate developer and how such an actor can collaborate with other

actors to facilitate the reuse of construction materials. Also, this study and its conclusions is

only based on reuse of construction materials for tenant adaptation projects. Secondly, this

study is limited to a certain number of actors. Some actors, such as governmental entities, legal

representatives and subcontractors have not been taken into account. Furthermore, the survey

conducted was only answered by tenants of the real estate company, Vasakronan, who were

located in Stockholm, Gothenburg and Uppsala. Lastly, this study examines a collaboration

between actors with regards to a general concept of reused material, i.e. this study does not

differentiate on whether the collaboration should be approached differently depending on the

materials reused.

1.6 Disposition This report is divided into six different chapters as seen in figure 1.6.

Fig. 1.6. Visualisation of the disposition of this report

The first chapter is the introduction which aims to give the reader a comprehensive

understanding of the problem and why material reuse is important, followed by the purpose of

this report and the research questions it is intended to answer. The literature review chapter

aims to give the reader an understanding of previous research regarding circular economy, reuse

of construction materials, reverse logistics, reverse supply chain and inter-organisational

collaboration. Thereafter the method chapter is presented, which shows the reader which

approaches the authors have taken in order to obtain the results needed. Furthermore, it aims to

clarify the chosen method and how it contributes to increased validity and reliability. This is

Introduction LiteratureReview Method Results Analysis Conclusion

6

followed by the results chapter which presents the reader with the empirical data that has been

collected from the interviews and survey. In the analysis chapter the authors discuss the results

obtained with the help of the theoretical framework, the literature review and the empirical data

collected. The concluding chapter presents the final conclusions drawn from the authors based

on the previous chapters as well as a review of the reliability and validity of the empirical data

collected and is then finalised with the authors suggestion for further studies.

7

2. Literature review

This chapter will provide the reader with previous research conducted in the field of circular economy, reuse of construction materials and inter-organisational collaboration. Furthermore, this chapter presents previous research on models of reverse logistics and reverse supply chain in the construction industry.

2.1 Definitions

2.1.1 Circular Economy Circular economy is a concept which has gained immense importance to policymakers and

industries in addressing sustainability issues during recent years. Therefore, it is out of

importance to define the concept of circular economy. However, the concept is rather broad and

is based on a fragmented collection of ideas from different scientific fields that all share the

idea of closed loops (Korhonen, 2018). Circular economy is seen as a business model which

contributes to sustainable development (Zhijun & Nailing, 2007). MacArthur (2013) explains

the term circular economy as “an industrial system that is restorative or regenerative by

intention and design” and thereby replaces the concept of “end of life” as the material remains

in productive use to create additional value and thus minimise waste. Similarly, Geng &

Doberstein (2008) provides an explanation of the concept that is derived from research in China

and concludes that circular economy is the “realisation of a closed loop material flow in the

whole economic system”. Circular economy emphasises on product, material and component

reuse, remanufacturing, refurbishment and the potential of sustainable energy sources through

the product value chain by a cradle-to-cradle life cycle approach (Rashid et al., 2013).

At first sight, the potential outcomes of circular economy seem solely positive, however it is

out of importance to consider that the positive externalities prevailing within a circular economy

are mostly based on environmental observations, rather than economical (Andersen, 2007).

According to Andersen (2007) the benefits with reuse and recycling materials will gradually

decline whereas there will be a stage where a cut-off will be reached. This is further

strengthened by Daly (2007) who believes that it is impossible for an economic system to be

fully circular due to the entropy law. Furthermore, according to Korhonen et al (2018) there are

several limitations and challenges when trying to implement the concept of Circular Economy

in practice, whereas the limitations are mostly centred around system boundaries as well as

governance and management. Therefore, a new definition of circular economy is developed by

8

Korhonen et al (2018) which besides production and consumption system also focuses on the

holistic contribution it has on sustainable societal development. The definition that Korhonen

has established takes into account the importance of inter-sectoral, inter-organisational

management and governance models (Korhonen et al., 2018).

2.1.2 Reuse of Materials

The general conception about reuse is using the same material in construction more than once

and for the same function as it previously had (Yuan & Shen, 2011). Furthermore, reuse of

materials can also be defined as “new-life” reuse, where materials does not necessarily need to

have the same function as it previously had, but is used as raw material for a new function

(Duran et al., 2006). In this report, reuse will be defined in accordance to the European

Commission Waste Framework Directive (European Commission, 2010);

“Reuse involves the repeated use of products and components for the same purpose for which

they were conceived” – European Commission 2010

2.2 Circular Economy and Material Reuse in the Construction Industry The concept of circular economy has gained recognition among policymakers in the

construction industry. However, research indicates that the building sector is still mostly

discouraging the implementation of it because of certain barriers (Nußholz et al., 2019). Limited

research on how circular economy and circular business models can enable the reuse of

construction materials has been undertaken, therefore there is a need for expanding the research.

2.2.1 Identified Barriers for Implementing Material Reuse

Nußholz et al (2019) examines the potential barriers and potentials for implementing the use of

secondary materials in the building sector and how a transition into a circular business model

can be of importance to increase the decarbonization of the sector. The most common barriers

according to Nußholz et al (2019) is identified to be the limited access of secondary materials

with sufficient quality, the lack of infrastructure necessary and few market actors with low

incentives for cooperation. Similarly, Adams et al (2017) conducted a research by analysing the

largest challenges and enablers that exist when recovering and using secondary materials in the

construction sector. Correspondingly to the study conducted by Nußholz et al. (2019) the most

common barriers for implementing the reuse of secondary materials were mainly centred

9

around the lack of incentives for designing end-of-life issues for construction materials, a lack

of market incentives to aid recovery, the low value of products at end of life, warranty issues

of using reused materials and a general lack of knowledge (Adams et al., 2017). Furthermore,

besides the general lack of knowledge, a major barrier according to Kartam et al. (2004) is the

negative perception the final users have on reused materials, which makes a shift in the end-

user’s mentality essential.

Enablers to successfully implement circular economy through the reuse of materials includes

feasible logistics, the development of higher value markets and clear business models (Adams

et al., 2017). While business models for the reuse of materials in the construction industry has

been developed, the implementation of such circular business models has been rather slow

(Nubholz, 2019). An issue that has been highlighted in previous research is the absence of

market incentives and the lack of incentives for cooperation between different actors, which

can be illustrated in the current lack of circular business models. In order to promote closed and

circular cycles, it is of great importance to include the entire supply chain and involve all parties

from the design stage to the material suppliers and the actors operating in the final stage (Leising

et al., 2018).

Reusing materials are often associated with financial value due to the reduction in costs from

using secondary materials (Verian et al., 2013). However, a limited amount of studies on the

financial aspects of material reuse within the building and construction sector have been made

(Hart et al., 2019). Studies made on circular business models in general often highlight the risks

associated with the uncertainty of the prices of secondary materials, the high costs associated

with labour and reverse logistics (Nubholz, 2019). In the field of recycled materials, whereas a

higher amount of studies has been conducted, Kartam et al. (2004) found that the cost of

recycled materials in comparison to raw material is an important factor in the decision factor of

using recycled materials. Furthermore, Lauritzen (1998) states that recycled materials are only

attractive to use when they are competitive with raw materials, both in terms of cost and quality.

In the context of material reuse, new material is likely to be more preferable due to the necessity

to meet regulatory requirements that secondary materials may struggle to attain (Ferreira et al.,

2015). Similarly, Vares et al. (2019), claims that the main obstacles for reusing construction

materials are the economic aspects listed below:

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• The overall cost of reused materials may exceed the cost of building with new or

recycled materials, due to the fact that when reused materials come to the market they

may require sampling, testing and certification.

• The second-hand market for construction materials is small. This results in preventing

reused materials to be applied on a large scale, due to a lack of recovery facilities and

information about reused elements from planned and on-going demolitions.

• There is a scarce amount of companies in the market today that are specialised in

deconstruction; designers willing to design buildings using reused materials and

contractors willing to construct buildings with reused materials.

Economic challenges such as financial metrics and a return on the investment is therefore

believed to be one of the biggest challenges with implementing material reuse in the

construction industry (Hart et al., 2019; Adams et al., 2017). Despite the economic challenges

arising, several studies show that a circular economy implementation has the potential to reduce

the total life cycle costs. (Ellen Macarthur, 2017). Mokhlesian and Holmen (2012) show that

the implementation of circular economy in the building sector has the ability to decrease the

total life-cycle cost. This is further strengthened by Jung et al (2015) who states that the total

costs of the entire value chain structure should be considered in the decision-making process of

recovering and reusing secondary materials.

Furthermore, it is important to recognise that in order to achieve economic viability, material

reuse must be accompanied with appropriate business models capable of commercialising price

competitive products that both meet regulatory standards in terms of quality and safety, but also

deliver strong sustainability benefits (Nußholz et al., 2020). The economic viability

accompanied with the business model also need to sort out other issues of interest in what value

the business model creates for the firm and its customers (Wirtz et al., 2016), and for other

stakeholders, in terms of environment and society (Massa & Tucci, 2014).

2.3 Sustainability Effects of Material Reuse There have been several research papers written regarding the reuse of materials in the real

estate and construction sector and its impact on sustainability. Previous research and literature

regarding reuse in the real estate- and construction sector claims to have been motivated by the

three E’s of sustainability; economic, environmental and equity (aka social) (Tobias &

Vavaroutsos, 2012; Wilkinson et al., 2009). However, most of the research that has been made

11

has mostly focused on the environmental and economic impact of reuse in the real estate and

construction sector and has thus mostly focused on two of the three E’s of sustainability

(Mohamed et al., 2017).

2.3.1 Economic Sustainability

A study regarding the effects of reusing materials in refurbishment projects, more specific,

commercial real estates was conducted in 2018 by Lindholm et al. for IVL (Swedish

Environmental Research Institute). The study was a case study based on two of IVL’s own

offices in Stockholm and Gothenburg and was focused on what the effects of the renovations

of the two offices would be from an economic and environmental aspect and was focused on

furniture’s and fixed interior building products, compared to what the effects of the renovation

would be with new materials. The study found that the office renovations with reused materials

ended up with reduced project costs of 1,4 million SEK for the office in Gothenburg and 1,9

million SEK for the office in Stockholm. The biggest reduction in costs came from reduced

purchasing of materials, followed by revenues from sales of used products and then reduced

costs for waste management. However, the study also concluded that reusing materials in the

two offices resulted in an increase of labour cost by 320 000 SEK for the office in Gothenburg

and 350 000 SEK for the office in Stockholm. The reason for the increased labour costs was

according to Lindholm et al. (2018) the fact that by using reused materials in a renovation

project, the overall wage costs increase due to increased planning work from architects and

contractors (Lindholm et al., 2018). Furthermore, since there are many actors participating in

an office refurbishment project, Lindholm et al. (2018) believes it is of importance to agree on

how the new costs and savings for applying reused materials should be divided amongst the

different actors.

2.3.2 Environmental Sustainability

The potential that material reuse has on the environment in terms of reducing embedded

emission has gained increased recognition amongst policy makers, companies and academic

scholars (Merrild, 2016; Moncaster et al., 2019). Several studies show that the reuse of materials

has a significant effect on reducing the negative environmental impact (Cabeza et al. 2014;

Nußholz et al. 2019). The extent of the positive impact varies and is dependent on the type of

material being reused and the processes affiliated with being able to reuse the material, such as

the process of making the secondary material fulfil certain requirements (Nubholz, 2019,

Vadenbo et al., 2017). A case study conducted in Sweden by Thormark (2000) investigated the

12

environmental effects on a building with a large proportion of reused materials compared to

newly produced materials. The study showed that the environmental impacts were about 55 %

lower with reused materials compared to if the materials were new. Of the materials

investigated, the study found that the reuse of clay bricks of roofing clay tiles accounted for the

main decrease in environmental impact and that these materials could be transported over a

long distance and still be environmentally beneficial (Thormark, 2000). Furthermore, a study

made by Nußholz et al. (2020) investigated what the environmental impacts of reusing two

different products, namely concrete and glass would be, compared to using newly produced

materials. The results suggested a carbon saving potential of 56 tons CO2-eq for glass and 11

tons CO2-eq for concrete.

Besides the potential economic benefits from renovating IVL’s two offices in Stockholm and

Gothenburg with reused materials, Lindholm et al. (2018) also came to the conclusion that in

the events of renovating the two offices with reused materials compared to new, the decrease

in waste would be 18 tons for the office in Gothenburg and 12 tons for the office in Stockholm.

Furthermore, the decrease in greenhouse gas emission would be 52 tons CO2-eq for the office

in Gothenburg and 41 tons CO2-eq for Stockholm. This corresponds to a gas emission decrease

of around 60 % per office, compared to new purchased materials (Lindholm et al., 2018).

2.3.3 Equitable Sustainability

As previously mentioned, out of the three E’s of sustainability, equity is the one that has been

focused least on with regards to reuse in the real estate and construction sector. However,

Mohamed et al. (2017) list four potential impacts on social sustainability due to material reuse:

• Creates distinctive communities: Constructing or renovating a building with a primary

focus on creating distinctive communities could have the potential to be more successful

and have a more lasting impact with using reused materials.

• Acknowledges underserved and vulnerable populations: Reuse that specifically focuses

on the needs of underserved and vulnerable communities can help counter the effects of

gentrification.

• Workforce development: Constructing with reused materials could be a key factor in

workforce development to train workers either in deconstruction and preservation

techniques and thus creating more jobs.

13

2.4 Reverse Supply Chain According to Guide & van Wassenhove (2002) the definition of reverse supply chain is:

“The series of activities required to retrieve a used product from a customer and either

dispose it or reuse it.” - Guide & van Wassenhove, 2002

The definition is further strengthened by Prahinski & Kocabasoglu (2006) who states that the

scope of Reverse supply chain also involves the collaboration with other parties and actors

(Prahinski & Kocabasoglu, 2006). The concept of a reverse supply chain implies that the life

cycle of products and materials do not end when being delivered to the end customer, rather,

the end-of-used products can be brought back from the end customers to the suppliers in order

for it to be reused, recycled or disposed (Álvarez-Gil et al., 2007).

The implementation of a reverse supply chain requires a large initial investment; however, it

also causes strategic importance to companies as well as economic benefits (Álvarez-Gil et al.,

2007). The strategic importance can be manifested by the “green image” it offers to the

company which may increase the company’s competitiveness in the market and with its

customers (Álvarez-Gil et al., 2007).

2.4.1 The Process of the Reverse Supply Chain

Important aspects to consider when establishing a reverse supply chain is which activities that

needs to be outsourced versus insourced and how to minimise the costs while maximising the

recovering value. When implementing a reverse supply chain, it also is of great importance to

make rational decisions about the structure of such a chain. Not all reverse supply chains are

identical, however Guide & van Wassenhove (2002) identified that the chain could be divided

into five key processes.

Fig. 2.4.1. Illustration of the Reverse Supply Chain. Source: Guide & van Wassenhove, 2002

Product acquisition

Reverse Logistics

Inspection and Disposition Reconditioning

Re-distribution and Sales

14

Product acquisition The term product acquisition refers to the process of obtaining used products, components or

materials from the user (Guide & van Wassenhove, 2002). According to Prahinski &

Kocabasoglu (2006), there exists three sources of products: those from the forward supply chain

which contains returns of defective or damaged products, those from an already established

reverse supply chain, also called market-driven systems; or those from the waste stream.

Products that enter the reverse supply chain through the waste stream can either be landfilled

or reused due to their recoverable value (Prahinski & Kocabasoglu, 2006). Guide & van

Wassenhove (2002) believe that the quality, quantity and the timing of the product return needs

to be carefully coped with in order to prevent receiving a huge number of returned products

with different levels of quality which further decreases the effectiveness of the process.

Retrieving the product efficiently is key to creating a profitable chain while coordinating the

collection of the used product through collaboration with distributors (Guide & van

Wassenhove, 2002).

Reverse Logistics Reverse logistics refers to the process of retrieving the product from the end consumer by

transporting the products to a facility for inspecting, sorting and disposition (Prahinski &

Kocabasoglu, 2006). Reverse logistics contain activities such as; transportation, recovery

facility, distribution and inventory management. During this process, the key objective is to

assess the condition of the return product and determine the level of quality and use a returned

product has (Prahinski & Kocabasoglu, 2006). Prahinski & Kocabasoglu (2006) suggested four

pre-dominant groups of product recovery strategies, namely, direct reuse, product upgrade,

materials recovery and waste management.

A business should aim to make decisions on the alternatives based on the quality of the product,

configuration of the product and other necessary variables as early as possible in the returns

process to achieve profitability and decrease logistic costs (Guide & van Wassenhove, 2002).

Products that are identified to be in a good condition can be reused by being returned to the

supply chain for distribution or to the secondary market for resale. Products which are

inadequate, and which does not meet the conditions for being reused, upgraded or recovered

should be incinerated or land filled (Prahinski & Kocabasoglu, 2006)

15

Reconditioning If product upgrade or material recovery is decided to be the most appropriate and profitable

product recovery strategy in the disposition process, then, the product is transferred to the

reconditioning process. During this process the product can be repaired, refurbished or

remanufactured. Repair refers to the return of used products to its normal order and refurbishing

refers to achieving a product specified quality standard, while remanufacturing aims at

reconfiguring a product to reach the same quality standard as a new product. (Gobbi, 2011).

However, reconditioning and remanufacturing processes are unpredictable as there exists a

large degree of uncertainty in the timing and quality of returned products (Guide & van

Wassenhove, 2002).

Re-distribution and Sales If recovered products are to be re-entered into an external market, reconditioned products and

products that are usable can be re-sold to the market (Nuss, 2015). Guide & van Wassenhove

(2002) proposes that companies that are considering to re-sell products firstly need to determine

whether there exists a demand for it or if such a market has to be created (Guide & van

Wassenhove, 2002). If a market has to be created, large investments are required to target

potential customers. Potential customers for the products can consist of both purchasers within

the existing markets such as original purchasers as well as new customers from different

markets for instance such customers who cannot afford new products (Guide & van

Wassenhove, 2002).

2.5 Reverse Logistics In the context of supply chain management, the management of reusing products and materials

in industrial production processes, also named reverse logistics, was developed to add value to

the current manufacturing processes. (Pacheco et al., 2018). Currently there exists no consensus

regarding the concept of reverse logistics (Nikolaou, 2013). Several authors and researchers

have defined reverse logistics somewhat broadly as the definition of reverse logistics is

sometimes referred to as reverse supply chain. However, according to Guide & van

Wassenhove (2002) the terms should be distinguished as reverse logistics is the process of

retrieving the product from the end consumer for the purposes of capturing value or proper

disposal (Prahinski & Kocabasoglu, 2006). According to Nikolaidis (2012), reverse logistics

can be defined as:

16

“the process of logistics management involved in planning, managing, and controlling the

flow of wastes for either reuse or final disposal of wastes” – Nikolaidis, 2012

The most recognised definition is however proposed by the European Working Group on

reverse logistics who defines it as “the process of planning, implementing and controlling flows

of raw materials, in process inventory, and finished goods, from a manufacturing, distribution

or use point, to a point of recovery or point of proper disposal” (Nikolau, 2013). There exist

two different areas where reverse logistics is applicable; after-sales and after-consumption.

Reverse logistics in after-consumption which is the area of most importance in this study

considers products at the end of their lifecycle, products that can be reused and industrial waste

from production processes. A reverse logistics approach should be adapted when products and

materials can be reused and whereas materials will only be disposed of when the total reuse is

unfeasible (Pacheco et al. 2018).

An effective management of the activities included in reverse logistics as well as financial

incentives is essential for companies to adopt a reverse supply chain system. If the total costs

related with the retrieval process exceeds the total cost of new materials or products, firms

would have smaller financial incentives to invest in such a system (Prahinski & Kocabasoglu,

2006). The design for a reverse logistics network has to be tailored according to the size and

frailness of the products and materials involved as well as the economics of their reuse (Guide

& van Wassenhove, 2002). Besides transportation and storage costs, companies should also

consider how rapidly the value of the returned products will decline as well as if logistics should

be outsourced (Guide & van Wassenhove, 2002).

2.5.1 Barriers for Implementing Reverse Logistics in the Construction Industry

The literature on the main barriers regarding reverse logistics has been made across different

industries, such as services, manufacturing and construction (Chileshe et al., 2015). Drawing

upon previous research, the barriers that exists in the construction industry can be categorised

into intra-organisational (internal) and inter-organisational (external). According to Chileshe et

al. (2015), the previous construction-specific literature consists of the following identified

barriers in relation to the two mentioned categories and are illustrated in the table below.

17

Table 2.5.1. Identified barriers within reverse logistics literature in the construction industry

Intra-Organisational Barriers Inter-Organisational Barriers • Higher initial costs of adopting Reverse

Logistics • Risks and uncertainties with using reused

materials • Operational difficulties with providing on-

site space for materials • Lack of awareness amongst organisations

regarding the potential benefits of reverse logistics

• Lack of recovery facilities, infrastructure and an established market for reused materials

• Lack of technical support such as building standards and guidelines for reused materials

• Lack of financial and regulatory incentives • End-users mindset about the lower quality of

reused materials • Low costs of newly produced materials • Lack of awareness of reverse logistics in the

construction industry • Lack of competence and experience in the

workforce

2.6 Identified Models in Reuse Management Previous research made in the field of reuse shows that different management models has been

created. In the aspect of reverse logistics and how it can be applied to the construction sector, a

study was made by Hosseini et al (2014) investigating the appliance of reverse logistics onto

the construction industry with lessons taken from the manufacturing industry. By investigating

previous research literature, Hosseini et al (2014) created one model on how to apply reverse

logistics in the manufacturing industry and another model for applying reverse logistics in the

construction industry. Fig. 2.6.1 and 2.6.2 shows the adaptations of the models created by the

authors (Hosseini et al., 2014).

Fig 2.6.1. Illustration of Hosseini et al’s model of reverse logistics in the manufacturing industry. Source:

Hosseini et al., 2014

18

Fig 2.6.2. Illustration of Hosseini et al’s model of reverse logistics in the construction industry. Source: Hosseini

et al., 2014

Similarly, as Hosseini et al (2014), another research was carried out by Pushpamali et al (2019)

investigating how the decision making of applying reversed logistics in the construction sector

could be streamlined. Hosseini et al (2014) argues that the primary reasons for reverse logistics

are economic factors and the desire for economic gains. However, Pushpamali et al (2019)

argues that the construction sector consumes more substantial quantities of scarce and finite

natural resources compared to other industries. Therefore, reversed logistics must be adopted

in the construction sector, primarily to reduce the negative environmental and social effects

caused by upstream construction activities (Hosseini et al., 2014; Pushpamali et al., 2019).

Thus, Pushpamali et al (2019) suggests a model (Fig. 2.6.3) for the decision on reversed

logistics which emphasises on both forward and reverse flow in order to maximise its

environmental, economic and social benefits. This model also emphasises on the fact that

reverse logistics decisions must be made during the pre-construction phase where planning and

designing takes place (Pushpamali et al., 2019).

Fig. 2.6.3. Illustration of Pushpamali et al’s reversed logistics decision making model. Source: (Pushpamali et

al., 2019).

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A study by Da Rocha & Sattler (2009) investigated how the collaboration between different

actors in the construction sector could streamline the process of reusing materials from an old

building to a new one. Using a theoretical framework of supply chain management and by

conducting semi-structured interviews with different actors in the construction and demolition

industry, they opted for a model (fig. 2.6.4) for how the process should be (Da Rocha & Settler,

2009).

Fig. 2.6.4. Illustration of Da Rocha & Settler’s supply chain management of reused building materials. Source:

Da Rocha & Settler, 2009

Although the model shows the different ways and actors that can benefit from reused materials,

it is mostly focused on the demolition firm’s perspective and not on all the stakeholders. The

study by Da Rocha & Settler (2009) further showed that the reuse of building components is

primarily supported by economic and social aspects, such as labour costs of deconstruction and

demand for reused materials.

A study by Iacovidou et al (2018) examined how RFID (Radio Frequency Identification) could

ease the flow of information between stakeholders in regard to reusing construction

components. By using a common platform such as RFID, it would be possible for all the

stakeholders to retain the functionality of a construction component through a flow of

information related to its treatment, use and maintenance that requires updates throughout its

entire lifecycle (Iacovidou et al., 2018). The idea of sharing information on a components

lifecycle throughout different stages is further described in a study by Motamedi et al (2011),

who explains that information regarding a construction component should be stored at a suitable

20

location that enables all stakeholders to efficiently access, read and update it accordingly

(Motamedi et al., 2011). Fig. 2.6.5 shows the model for the levels of information flow required

for managing reused construction components between the stakeholders (Iacovidou et al., 2018)

Fig. 2.6.5. Illustration of Iacovidou et al’s, information flow model. Source: Iacovidou et al., 2018.

The model by Iacovidou et al. (2018) shows what type of information that needs to be reported

and also when it needs to be reported. Therefore, it could prove to be a valuable tool for

managing reused construction components between different stakeholders. By providing all the

stakeholders with access to view and update the information, the product data can be followed

up in real time throughout the entire product lifecycle (Iacovidou et al., 2018). However, the

model demands that all the stakeholders have access to RFID, which may not be the case in

practice. Also, it would require unified standards and best of practice guidance (Iacovidou et

al., 2018).

Despite the models presented, few models in reuse management which emphasises on the

collaboration between different actors has been produced. There exists a lack of extensive

research and a big research gap on how such a collaboration can facilitate the implementation

of the reuse of construction materials.

21

2.7.1 Summary of the Models Table 2.7.1. Summary of the models presented in previous chapter

Models Reference Positives Negatives Theoretical Framework

Reverse Logistics in the manufacturing

industry model

Hosseini et al., 2014

Takes into account different ways that materials can be

circular

Mostly adapted to the manufacturing

industry and may not be as

appropriate in other industries

Reverse Logistics

Reverse Logistics in the construction industry model

Hosseini et al., 2014

Takes into account different ways that materials can be

circular

Mostly adapted to the construction

industry and may not be as

appropriate in other industries

Reverse Logistics

Reverse Logistics decision

making model

Pushpamali et al., 2019

Emphasises that decisions

regarding reuse must be taken in the early stages of designing

and planning

Requires an early initiative from the

client to use reused materials, which may not always be of

interest for the client

Reverse Logistics

Supply chain management for

reused construction

components model

Da Rocha & Settler, 2009

Gives a comprehensive view

on the different ways and actors that reused materials can

go

Solely focuses on the aspects of the demolition firms

Supply chain management

Level of information flow for

managing reused construction

components model

Iacovidou et al., 2018

Shows in a thorough way when the

information needs to be transferred and

what it should contain

Requires that all the stakeholders implement RFID into their daily

routines

Not given in the report

22

2.7 Inter-Organisational Collaboration Inter-organisational collaboration refers to the process of collaboration between different

organisations with a wide variety of stakeholders facing complex issues they cannot solve

separately (Franco, 2008). A theoretical perspective to conceptualise inter-organisational

collaboration is inter-organisational domain theory, which emphasises on how collaboration

can be a response to inter-organisational problem domains. A problem domain is an entity that

is socially constructed, arising when a set of actors becomes dependent on each other as the

actions that the actors take in response to a problem occurring can generate potential and

unpredictable consequences for the others (Franco, 2008). An inter-organisational collaboration

between different actors from different organisations can lead to failure, primarily due to

asymmetry of interests and goals (Cabrera & Cabrera, 2002), diverse routines, practices and

values (Levina, 2005). However, Gray (1989) argues that the differences in actor’s views,

interests and knowledge when facing a problem becomes a valuable asset, which enables the

actors to develop a shared understanding of the problem. Furthermore, Gray (1985) believes

that the perception of the positive outcome of an inter-organisational collaboration can be

increased for certain actors when incentives are provided.

Decision-making problems in a construction project is often caused by the complexity and the

high number of involved actors which characterises the construction industry (Yamazaki,

2004). Inter-organisational collaboration in the construction industry refers to relationships

between and amongst organisations, such as suppliers, customers, contractors and competitors

that are pursuing mutual interest, whilst still remaining independent and autonomous and thus

maintaining separate interests (Ebers, 2015). Actors in the real estate- and construction sector

can actively reach out and collaborate between organisations, projects and resources and

activities that are engaged over time (Havenvid et al., 2019). For instance, in terms of the

materials and technologies they use within and across projects, the lessons obtained from within

and across projects as well as how they develop new solutions within and across projects

(Havenvid et al., 2019). However, these gains can only be actualised when collaborative

partners trust each other and create business decisions and plans that are mutually beneficial

(Daugherty et al., 2006).

Transitioning to a circular economy in the construction and waste industry goes beyond the

borders of a single actor and stimulates the need for a collaboration among different actors. The

concept of circular economy can therefore be enabled through an inter-organisational

23

cooperation among different actors (Ruggieri et al., 2016). By investigating how opportunities

of cooperation through inter-organisational symbiosis can enable the development of circular

approaches to reuse waste, the authors found that inter-organisational cooperation can in fact

facilitate the potential reuse of waste (Ruggieri et al., 2016).

Despite the potential benefits of inter-organisational collaboration there exists several barriers

to achieving efficient inter-organisational resource management. Nilsson & Baumgarten (2014)

has identified barriers structured into five categories;

o The economic factor includes barriers such as high investment costs, low results due

to limited access to material and an unstable market.

o The social factor includes barriers such as a social isolation between organisations, lack

of time and resources as well as resistance from external factors such as public entities.

o The technological factor includes barriers related to materials such as being unsuitable

for reuse and having quality assurance demands on materials.

o The information related factor contains barriers such as limited knowledge about the

market, limited information on potential benefits and a lacking communication between

companies.

o Policy related factor barriers such as demanding logistic requirements and a lack of

supporting legislations and policies.

24

3. Method

This chapter presents the reader the methodological approaches the authors have chosen in order to conduct this study. Furthermore, this chapter presents the reader with information regarding the respondents interviewed as well as the actions taken to withhold a high reliability and validity.

3.1 Methodological Approach When discussing methodological approach, there are two general categories of methodologies;

quantitative and qualitative. Quantitative methods are more preferable in research questions

such as “how much” and “how many in general to a greater amount”. The aim with such a

method is to apply a relationship between parameters and variables to a general population

(Brannen, 2005). Qualitative methodologies emerged as a criticism towards quantitative

methods (Flick, 2014). Flick (2014) argues that qualitative methodologies are more relevant

today because people live a more individualised life than before and society today is more

diverse for sub-cultures and lifestyles than before. Therefore, according to Flick (2014), a

qualitative research strategy is better adapted to subjective research questions.

In order to fully investigate the research question, this study has used a triangulation of methods.

According to Gardner (1990), a triangulation can be described as “a combination of

methodologies in the study of the same phenomena”. There are different ways to design a

triangulation of methodologies. However, what they all have in common is the assumption that

the effectiveness of a triangulation rests on the premises that the weakness in each single

method will be compensated by the counter-balancing strength of another (Jick, 1979).

Bouchard (1976) argues that by using more than one method in the validation process, you

ensure that the variance is reflecting that of the trait and not on the method. Thus, the merging

of methods can enhance our belief that the results are valid and not a methodological artefact.

This report used an abductive research strategy, which is a combination of an inductive and a

deductive strategy. An inductive strategy means that the theoretical frameworks are based on

the empirical data collected, while a deductive strategy means that the researcher has a

perception on what the results will be based on the theoretical framework and then compare it

to the empirical data collected. By applying an abductive research strategy, it is possible to

25

change the strategy of the research depending on the questions that might arise during the

research (Saunders et al., 2015).

The primary data was obtained by semi-structured interviews with relevant people in the

industry as well as a survey to the tenants. The semi-structured interviews were conducted with

determined main questions, with the possibility to free follow up questions based on the answers

from the respondents. Semi-structured interviews are best suited for subjective questions where

the answers from the respondents are based on their own experience and perception. The choice

of semi-structured interviews is done based on the premise that the respondents might have

different opinions regarding reuse of materials and a semi-structured approach with free follow

up questions thus allows for a deeper understanding of the questions and answers between the

interviewer and the interviewees.

To get an understanding of the tenants view on reuse, the most ideal approach in this study was

to conduct a survey. There is always a risk for bias and error with a survey, but the procedure

used has a major effect on the likelihood that the results will be accurate and in terms with

reality (Fowler, 2009). In order to minimise the risk of potentially receiving answers that do not

correspond with reality, a survey should have standardised questions (Fowler, 2009). To collect

enough participants, the survey was internet-based and sent to a total of 400 companies who

are tenants to Vasakronan which resulted in a total of 40 responses. To decrease the risk of bias,

the survey was anonymous and the only information the tenants had to disclose was which

sector their company operates in.

An adequate approach to complete the primary data is to complement it together with secondary

data and then compare the results from the two. Saunders et al. (2015) argues that by

complement the primary data with secondary data, it is possible to further argue for the data

obtained by the primary data, or even discover new results by triangulation (Saunders et al.,

2015). Therefore, secondary data has been obtained by an extensive literature review regarding

previous research and literature in this topic. The literature review mostly consisted of peer-

reviewed scientific journals and governmental reports.

By gathering the primary data from the interviews and survey as well as secondary data from

investigating previous models made in the field of reuse management, the aim is to develop a

26

new framework model for optimising the management of reused materials and how a strategic

collaboration between actors can be incorporated in such a model.

3.2 Choice of Respondents When choosing respondents to interview, a lot of emphasis was put to conduct interviews with

relevant actors active in a tenant adaptation project from different fields within the real estate-

and construction industry. This was done due to the fact that by interviewing actors from

different fields, it would then be possible to locate common challenges these actors face and

how each of these actors can collaborate with each other. Therefore, interviews have been

conducted with representatives from real estate companies, architectural firms, demolition

firms, waste firms, contractors, material suppliers, logistics companies and consultants

specialised in reuse of construction materials. The respondents interviewed represents the

following companies; AMF Fastigheter, Castellum, Hufvudstaden, Skanska, NCC, Skanska

Hus, Ragnsells, Lotus Maskin och Transport, CS Riv och Håltagning, Byggpall, Interface,

Nordström Trä, Moelven, Omreda, Kompanjonen, White Arkitekter and IVL Svenska

Miljöinstitutet. Table 3.2.1 shows each representative, their role in the company and how the

interview was conducted. The questions asked in the interviews will be presented in the

appendix at the end of this report.

Table 3.2.1. List of the respondents and their role in the company

Respondent

Type of company

Role in the company

How the interview

was conducted

Real Estate Developer 1

Real estate company Head of Sustainability Telephone

Real Estate Developer 2

Real estate company Head of Sustainability Microsoft Teams

Real Estate Developer 3

Real estate company Head of Sustainability Microsoft Teams

Contractor 1 Construction company Sustainable Business Developer

Telephone

Contractor 2 Construction company Research and Innovation Coordinator

Telephone

Contractor 3 Construction company Project Manager Telephone

Waste Contractor 1 Waste contractor Contract Manager Telephone

27

Demolition and Logistics Contractor 1

Demolition and logistic company

Project Manager Telephone

Demolition and Logistics Contractor 2

Demolition and logistic company

Head of Quality and Environment

Telephone

Supplier 1 Supplier of construction pallets with

specialisation on reused pallets

Project Manager

Skype

Supplier 2 Supplier of textile and floors

Sustainability Ambassador

Telephone

Supplier 3 Wholesaler of wood Sales Manager Telephone

Supplier 4

Supplier of prefabricated construction modules

Marketing Director Skype

Consultant 1 Independent consultant in reuse and renovations

Consultant in reuse and renovations

Telephone

Consultant 2

Independent consultants in reuse of construction

materials

Consultant in reuse

Telephone

Architect 1 Architectural Firm Architect Skype

Researcher 1 Research institute funded by the Swedish

government

Project Manager Mail

3.3 Reliability and Validity Reliability and validity in research studies are of utmost importance. There is a general

consensus amongst researchers that all research must be open for criticism and evaluation. To

not be able to assess the importance of a study, the soundness of its methods, the accuracy of

its findings, the integrity of the assumptions made, or conclusions reached, could have

devastating consequences. Empirical findings that prove to be ambiguous or incomprehensible

may result in a waste of time and effort, while empirical findings which are quite frankly wrong

may result in the implementation of dangerous or harmful practices (Long & Johnson, 2000).

According to Polit et al (2001), validity can be defined as “the degree of consistency or

dependability with which an instrument measures the attribute it is designed to measure”, while

reliability is defined as “the degree to which an instrument measures what it is intended to

measure”. In order to minimise the risk of low reliability and validity, some actions have been

taken in this research:

28

• The respondents were chosen based on their expertise and experience within the real

estate and construction sector and also within reuse of materials.

• The interviews were conducted in a semi-structured way in order to have a freer

interview with relevant follow up questions that adds to a deeper understanding of the

questions and answers.

• The interviews were recorded to ensure the minimisation of loss of information from

the time of the interviews to when it is analysed and written down.

• The questions were formulated so that the risk of misinterpretation is minimised.

• The secondary data from the literature review was obtained from peer-reviewed journals

and governmental reports.

• The survey conducted was anonymous. This will ensure that the respondents will

express their opinion more freely, without feeling that they are going against company

policies or jeopardising their own interests.

3.4 Ethics Every researcher has an obligation to conduct research within the frames and aspects of the

ethical standards. Therefore, this research was conducted according to Bryman & Nilsson’s

(2011) four principles of research ethics:

• Information. The people participating in a research project shall be informed of the

purpose of the research. This includes that the participants shall know that their

participation is voluntary and not forced upon. They shall also be informed that they

have the right to drop out of the research if they want to.

• Consent. The people participating in a research have the right to decide for themselves

the level of participation they wish to have. They can themselves choose not to answer

a question if they do not wish to.

• Confidentiality. The personal data from the participant will be treated with the utmost

confidentiality. This is to prevent unauthorised people from getting access to their

personal data.

• Use. The empirical data obtained from the participants will only be used for the purpose

of this research.

Another key aspect in ethics is diversification amongst the participants. The goal of this

research is to obtain data from people with different ethnicity, gender, professional and

background.

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4. Results

This chapter presents the reader with the empirical findings obtained from the interviews and the survey conducted. The empirical findings in this chapter is focused on the barriers as well as the incentives required to implement material reuse and participate in a strategic collaboration for material reuse.

4.1 Current Business Models Within Reuse of Construction Materials To obtain an overview of the present approach of how companies within the real estate- and

construction sector works with material reuse and identify potential difficulties with fully

implementing a circular approach to reuse, the respondents were asked about their company’s

current business model related to material reuse.

4.1.1 Real Estate Developers

According to the respondents within the real estate sector there exists no clear and common

framework for working with reuse of construction materials. Each real estate developer’s

business model differs depending on the company’s environmental awareness and established

goals within the firm. However, the company’s business models are similar in several aspects,

for instance, a majority of the real estate developers mainly work with transferring materials

that can be reused within their own construction projects. When working with reconstructing a

property, Real Estate Developer 1 mentions that they use a third-party consulting company that

specialises in reuse to make an inventory and quality assurance of the existing materials within

the premises to determine what can be reused. Real Estate Developer 2 mentions in the

interview that their existing strategy to minimise waste and to encourage the implementation of

reusing materials is mainly through putting demands on the contractors that only a certain

amount of waste can go to the landfill, which indirectly forces the contractors to reuse

construction materials. Real Estate Developer 3 emphasises that their business model focuses

on planning buildings that do not require demolition when a new tenant is moving in. Therefore,

constructing flexible buildings with materials that are more expensive and are meant to last

longer than other materials is more preferable. Thus, planning for buildings to last longer and

preserving their current property stock in order to prevent the need for reusing is their main

business strategy rather than constructing with the intent of reusing. The real estate developer

uses standardised materials which are seen as exclusive, has high-quality and has a long

lifespan, materials used are for instance marble tiles in the restrooms.

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“Focus should be emphasised on constructing and designing to avoid the need to reuse

materials, rather than focusing on how to reuse materials. Constructing buildings with a

long-term perspective will diminish the need for demolition and reuse of materials.” - Real

Estate Developer 3

4.1.2 Contractors

Out of the three contractors interviewed, two of them are currently developing their business

models to implement reuse of construction materials on a larger scale. Contractor 1 mentions

that two business models are in progress, however the respondent could not disclose

information on the content due to them being in an early testing-stage, only that they differ in

two important aspects: purchasing strategy and quality assurance. Unlike previous

respondents, Contractor 2 reveals in the interview that the company has an internal digital

platform where they can share leftover materials from their own construction sites which can

further be reused in other of their construction projects. In terms of quality assurance, the

company is currently developing methods to assure the quality of the reused materials,

according to the respondent samples of materials are sent to RISE (Research Institutes of

Sweden) for quality assurance.

4.1.3 Demolition and Logistics Companies

Demolition and Logistic Contractor 2 that was interviewed has a fully established circular

business model for reusing construction materials. The company has a subsidiary which sells

reused construction materials to third party customers. Demolition and Logistics Contractor 2

mentions in the interview that the company and its subsidiary is responsible for dismantling,

making quality assurance of the materials and then transporting it to their recovery facility. The

company usually plans ahead to match a certain demolition process of a building with a

construction process that is going on at the same time, to be able to reuse the materials from the

demolition. The company has also applied an own climate calculator to determine and present

how much CO2 emissions can be saved by reusing certain construction materials to the client.

Furthermore, the subsidiary company is not only bound to the parent company itself, but also

receives materials from external companies and actors.

4.1.4 Suppliers

Similar to Demolition and Logistics Contractor 2, Supplier 1 has a fully established business

model that specialises in reusing construction pallets.