Making Renovation Less Risky – AEC Business

Dutch bank ING’s research found that the overall EU construction market’s share of renovation and maintenance grew from 48% in 2008 to more than 54% in 2022. Despite its prevalence, renovation remains a conscious risk-taking for developers and builders. Due to various surprises, the costs of these projects can increase unpredictably, and builders may even avoid highly demanding projects.

A recent Building 2030 research report, Industrialized and Digitalized Renovation, investigated how prefabrication and digital information management could make renovation more controlled and less risky.

The needs

The researchers conducted an online survey and in-person interviews to understand the renovation scene better. Three areas emerged as the top development needs:

1. Initial data and its significance as a source of risk – Since the actual condition of structures, for example, is only revealed after demolition work, surprises are expected. Thoroughly determining the initial data before planning and construction is financially highly beneficial.
2. Collaboration and interaction among project participants, as well as the implementation of risk management at different project stages — Expanding networks and the concurrence of design and construction require a constant and intensive exchange of information and cooperation.
3. Expertise, established practices, and implementation of risk management measures – Over 80 percent of participating construction companies had established risk management practices, but respondents perceived their effectiveness as weak at the company and individual project levels. Additionally, there is little training in risk management.

The suggested improvements

The Building 2030 researchers suggest several strategies to make renovation projects more controlled:

Systematic risk management

Based on the findings, researchers developed a risk management process model for companies and a risk management tool, including a registry of risk factors from 108 renovation projects.

Offsite construction

Despite many challenges, industrialized construction could be up to 30% cheaper overall than on-site implementation. The quality of installation work improves, the duration of the worksite is shortened, and ergonomics and occupational safety also improve.

Additionally, industrial renovation saves energy during both the production and use phases. However, industrial construction requires new design and installation expertise and collaboration.

Data-driven management

The research suggests that data-driven management should cover the entire project to address these issues. It starts in the pre-planning phase, where all possible initial data is digitized, and the building’s demolition and digital scanning begin well before planning.

The project is divided into necessary tasks and roles, which are communicated to the parties from the start.

BIM

BIM is already regularly used in new construction in many countries. Similarly, renovation design should be model-based.

Since design and construction are iterative processes in renovation projects, the up-to-dateness of models is a must. In a model-based process, all project participants must be connected to the same digital communication platform. This ensures everyone can access the latest information, and progress and quality reporting are real-time.

A decision-making model

The research suggests a four-field model for considering solutions, where the individuality of the target and the scope of renovation construction determine the management models used: industrialization, standardized processes, or collaborative projects (e.g., IPD).

Although renovation construction is project-centered, researchers encourage broader lifecycle thinking. Every renovation should consider how to prepare for future needs so the next project will be less challenging.

You can download the report in Finnish.