The capital of resilience? open cities

The past weeks we have been involved with an emerging group of Dutch architects that is looking for a radical change in the building industry and built environment with the aim to transform cities. Although their ideas may seem radical, they are building on ideas that have their origin already back in the 60’s. These Dutch architects are now the Founding Partners of OpenBuilding.co. “The ideas of the Founding Partners of OpenBuilding.co are built on the legacy of Professor N. John Habraken who promoted Open Building in the 60's as a radical shift in decision-making for mass customised housing and a new ways to harness the power of industrial production.”. 

After my presentation at the meetup at Pakhuis de Zwijger, where we presented the potential benefits of building with wooden materials, Marc Koehler (One of the Founding Partners of Openbuilding.co) asked if Dr2 New Economy could create a Business Case for Open Cities to present at the World Architecture Festival. 

Which drivers are important to calculate the true value of the Open Building philosophy?

In co-production with Fakton and GreenMatters we explored several (financial) drivers and their impact in future business cases, including monetizing the principles of life-extension in buildings and other financial incentives such as taxing materials & CO2 of new building principles such as Open Building. 

Buildings change continuously during their lifecycle. This change is inevitable in the built environment and therefore requires attention in design as Brand (1994) pointed out in his book “How buildings learn”. Brand divided building systems into six layers: site, skin, structure, services, space plan and stuff. While change in each layer happens at different times, changes in the building system are controlled by slowly changing layers. For instance when applying technological systems in the skin of buildings, which are quickly outdated and in need of replacement. The rapidly changing layers simply follow along: site dominates the change in structure, which controls the skin and so on for the services, space plan and stuff. Open Cities have their foundation in Open Buildings. The Open Buildings approach extends the lifespan of buildings by using a design that allows for continuous, fast and relatively easy transformation between different types of use functions within buildings. This is enabled by creating a permanent structure which is separated from the (temporary) infill systems while using components and materials that are designed for disassembly. This allows for a more flexible use of buildings as uses can be altered, long term costs of maintenance, renovation and transformation can be reduced and massive amounts of materials can be saved while enabling more variable user-oriented business models aimed at services and performance instead of ownership.

In previous work together with Metabolic we found that €688.000.000,- of the resources in our building stock is being wasted each year. Working towards more dynamic buildings that prevent the waste of natural resources, can be an effective solution in creating a more open, diverse and resilient model for cities. This will make cities more responsive to social, demographic and environmental changes. 

However, radically redesigning the built environment requires us to redesign our financial system as well. An Open Building requires approximately between 10%-20% more initial investments compared to a traditional building. This investments pays-off after the first transformation of function of traditional buildings. While traditional buildings are in need of a new round of investments, the transformation of Open Buildings is much more cost-effective. Looking at high-end real estate development these percentages may be marginal. But, the real societal challenge lies in realizing affordable, qualitative and social housing. To change the financial perspective we need to look at the total costs of ownership/user, including the comparison of buildings emitting CO2 to the once that store CO2, while looking at the function and uses of buildings, and their contribution to quality of life, instead of ownership.

The IIRC identifies six capitals that are useful when considering value creation of current business activities, namely natural capital, human capital, social and relationship capital, financial capital, intellectual capital and manufactured capital. I would like to add a seventh form of capital, the capital of resilience allowing for these six forms of capital to adapt to changing needs. Embracing returns on these seven capitals and including these returns in the model for Open Cities requires a reinvention of current business models which are more oriented towards end-users. A system which is currently being applied by Commonland as a science-based framework for global landscape restoration. This system already enables four returns in social capital, natural capital, financial capital and inspiration (a form of intellectual capital).

A Business model is not about making money, it’s about long term holistic value creation within these seven capitals and if used appropriately it can function as a true accelerator in the right direction. For that, the euro is a comprehensible metric that we can use. Using currency can be central in these calculations of these forms of capital, however, the challenge still remains in defining and valuing the less tangible forms of capital on which our systems (social & ecological) depend upon. 

Society and policy is currently growing from small subsidies and standards to true costing, health and well-being and a CO2-tax all really influencing the true financial business cases towards more transformative and open systems like the Open Building model. Is the building industry ready for this change? We believe that the industry (both financial as the built environment) has to change rapidly while lots of old structures/methods are in need of a redesign. The first movers are on the rise.....

let’s accelerate these initiatives while building new systems and more holistic forms of returns. 

We started with different kinds of tools and methods into valuing and including these seven forms of capital while integrating them into new financial perspectives. If you are interested in the financial models that Dr2 New Economy are building, contact me and let’s have a chat over a cup of coffee. I believe this is just the beginning, let’s continue the good work! 

Thank you all Open Building founding fathers visible at www.openbuilding.co/manifesto, and in particular for the cases and co-production in preparation: Pablo van der Lugt (Greenmatters), Dominique Rethans &  Robert van Ieperen (Fakton). Marc Koehler (Marc Koehler Architects), Tom Frantzen (Tom Frantzen et al) and last but not least co-writer and colleague Jonah Link (Dr2 New Economy).