economies of sustainable construction

Nathalie Janson & Christian Berkes
on Economies of Sustainable Construction

Nathalie Janson co-edited the book „The Economy of Sustainable Construction“, which was published by Ruby Press. Here, she discusses market forces in the building sector and alternative ways of evaluating architecture and its societal benefits.



CHRISTIAN: When I received my copy of The Economy of Sustainable Construction, the first thing I did was flip through it. It’s abundantly illustrated and approaches its subjects in a very visual manner, using photographs, diagrams, and drawings. For some people, infographics are a great way to communicate complex topics. However, others argue that they are misleading, oversimplified abstractions. What is the aim of the book’s visual introduction, “Can Sustainability Be Economical?” by economist Lucas Bretschger?

NATHALIE: The visual introduction reflects the overall design and curation of the book,. There is no blank endpaper when you open the book; instead, it begins right away with the visual introduction, which is placed before the table of contents. We envisaged Bretschger’s piece as a very clear graphic introduction to the book’s subject, setting up some key thoughts and relationships that recur throughout the book. By exploring a simple yet very complex question—can sustainable construction be economical and even profitable?—Bretschger’s piece sets the tone for the rest of the book. Also, although the book is largely about the economy, its intended readership consists of more than just economists: it includes architects, urban planners, and other people who are involved in the built environment and are very visual. As for the tendency of infographics to oversimplify: that’s sometimes the case. But the idea here is that they just serve as an introduction to the subject, which the essays explore in greater depth.

CHRISTIAN: There’s a diagram from David Harvey’s essay “The Urban Roots of Capitalist Crises” that comes to mind. It shows the number of buildings taller than seventy meters that were constructed in New York between 1890 and 2010 and juxtaposes this with the financial crashes that occurred in 1929, 1973, 1987, and 2000. In the diagram, one can see how property booms precede economic crises and the direct relationship between the building sector and the financial market. With this as one starting point, Harvey uses his essay to explain this relationship in greater detail. Throughout The Economy of Sustainable Construction, people from different spheres are struggling with this very question. The graphics in the book show how relevant the building sector is for sustainability in terms of the economy and ecology. Harvey takes the opposite approach: he shows that the financial market cannot be described without the building sector.

NATHALIE: There is a popular idea that the building of showcase architecture always precedes an economic crisis and is therefore an indicator of economic trouble—that banks, for example, will commission extravagant headquarters right before going under. This is partially because there is a strong correlation between the construction sector and the use of buildings as commodities and investments, which means that construction is a big part of the economy. Architecture with a capital A also has great symbolic power and is often used to project confidence. I recently went to Istanbul and visited Dolmabahçe Palace, one of the grandest buildings built during the Ottoman Empire, which was finished around sixty, seventy years before the Empire collapsed. Part of the problem was that it was funded by money that the Ottomans borrowed from abroad and didn’t have the means to pay back. Here we see both sides: architecture as a symbol, a projection of power, and as something that simply costs a lot of money.


CHRITSIAN: Let’s return to the cover. A tiny input leads to a big output. How does that work? Is it magic?

NATHALIE: No, it’s sustainable construction! I think it’s important to discuss the front cover because it says a lot about the book’s intentions. The basic impetus for the book was to challenge the common idea that sustainable construction is more expensive than conventional construction. The diagram upends the idea that the input in sustainable construction is greater than the output. Something that we discuss in the introduction is that this economic equation of inputs and outputs changes dramatically depending on the parameters we set for the equation. The cover, in that sense, acts almost like the hypothesis for the whole book: sustainable construction is profitable, the input is smaller than the output. It’s also important to consider other non-financial benefits of our built environment. Buildings don’t just have to benefit society financially. Maybe they can also provide ecological and social benefits. We need to reconsider how we value things. Right now, most people who build and invest in buildings are mainly concerned about that economic input-output equation.

CHRISTIAN: So it’s a two-sided question. On the one hand, the question of evaluation: How do you set the frame when thinking about different topics in building? On the other hand, the question of expectation: Which circumstances do you wish to effect with your actions? The visual introduction says: “sustainability is becoming common sense in real estate.” That means it hasn’t been in the past. Why?

NATHALIE: The main challenge to introducing more sustainable measures in the construction industry is the idea that sustainable construction is costly. In several studies, people will admit that sustainability is important and that we need to consider the future of younger generations. But then they argue that in the short term, it’s not economically viable.

CHRISTIAN: This leads us to the question of the scale on which sustainability is happening. Is it an individual scale, a scale of personal decision-making, or the scale of state regulations? And then there’s the question of the relationship between knowledge and rules.

NATHALIE: The scale of sustainable construction that is explored in the book is both small and large. There are two ways of approaching the “economy of sustainable construction.” One is to understand it as the relationship shared by all people and all interests in the built environment. That means architects, planners, investors, governments, businesses, and the people who build and maintain the built environment. The other is to look at how economical the built environment is. Sustainability is already happening on the smaller scales of individual buildings and individual lifestyles. But, of course, the challenge is how to scale up these practices: to make infrastructure, transport, and housing for whole cities and nations more sustainable. People working in construction and with the built environment need to be educated about the hidden costs and benefits of conventional construction and sustainable construction. We need to inform people about the need for sustainability and also show that sustainability can be profitable if you think about it in broader, more holistic terms. And we should really encourage people, and businesses, and investors, and architects, and planners to adopt more sustainable practices. A big challenge for sustainable construction is that people think about the short term. Most investors and politicians, for example, work with election cycles and profit returns that force them to prioritize short-term profit and gain. To encourage more sustainable practices, you have to make them profitable in a way. That’s a crucial point. It’s really difficult for a business to adopt more sustainable practices; it exposes them to risk in a competitive market. They either end up profiting on visionary decision-making, or they lose out. In this situation, it’s important for governments to provide a kind of safety net for businesses and people to be able to make those decisions. There needs to be regulation to punish unsustainable practices, by pricing carbon emissions for example. At the same time, there need to be incentives that encourage and reward sustainable measures. The government, in a way, is best-suited to draft such legislation because it has a broader perspective on the situation and the power to enforce; governments also often end up cleaning up the negative social and ecological effects of unsustainable business practices.


CHRISTIAN: The book does reflect many different spheres, scales and constellations. There are specific case studies that range from minibuses in hilly Rio de Janeiro switching off their engines when going downhill to save fuel to larger participatory projects that empower people and work from within a community. One of the recurring questions in the book asks how can we cope with the effects of neoliberalism. A lot of problems and options discussed in the book are heavily influenced by the broader logic of the market. However, the book also points out that we need new evaluation systems. Do you see any new evaluation systems that go beyond pure market logic?

NATHALIE: There are two takes on that question in the book. One group of people is operating within today’s market logic; they argue that sustainable buildings are, or can be, profitable in that system. One good example of this camp is Gail S. Brager’s contribution, which shows just how much money businesses are losing because of low worker productivity caused by poor indoor environmental quality. The flipside is that these businesses can gain a lot economically by increasing the health and happiness of their workers. Another group presents ways of evaluating the built environment that are not just economical. Representative of this group is Sheela Patel and Keya Kunte’s piece on SPARC, which describes the work they do to empower people living in poverty. I think sustainable construction—in the way we understand it as having a financial, social, and ecological value—is a different way of looking at a society, one that’s not entirely based on the logic of the market. There is a social value to teaching people and empowering people to effect positive change in their built environments. That value isn’t necessarily a financial value. Everyone deserves shelter, everyone deserves dignity—those are human values. There’s no one evaluation model that is as tangible today as that of the market. But we can see how different values are coming to the fore. For example, empowering people living in informal neighborhoods is becoming a more important issue. The private sector and governments are increasingly interested in investing in these neighborhoods. It’s very important to make sure that this money is invested in a way that benefits the people who already live there.

CHRISTIAN: Am I mistaken, or do architects like to undertake empowerment projects in the developing world, but don’t like to do the same work at home?

NATHALIE: It is critical to empower people in the developing world, where people are very vulnerable to corporate interests and the interests of the private market. But that also applies for people living in the West. We operate under the false notion that because we live in a wealthier, more democratic environment, we aren’t as vulnerable to corporate interests or those of neoliberalism. But we actually are. In the US, for example, there is a high degree of corporate lobbying. Private citizens, unfortunately, do not have as much influence as many corporations that are involved in politics today. Aron Chang’s piece is an example of how architects are working with communities “at home,” in the West. In his piece, Aron explores informal architectural adaptations in American suburbs. He shows how people have adapted their living environment—by running businesses out of their garages, for example, or renting them out as separate units—to provide financial security or to accommodate a different household composition than the nuclear family. This essay is really a call for empowering people. Suburban development was heavily influenced by the corporate interests of banks, the construction industry, and the automobile industry. In suburbs, there are certain rules that govern these communities and limit adaptations; these rules are not always in the best interests of the people that live there.


CHRISTIAN: Are we all on the same page when it comes to sustainability? What about language?

NATHALIE: When it comes to sustainability, clarity is key. Sustainability means very different things to a lot of different people. It’s therefore important for each person to articulate what he or she means by “sustainability.” We also need to better articulate the urgency of the situation. There are really well-educated, well-informed people who tell us that we are experiencing unsustainable increases in temperature and that we are emitting too much carbon dioxide. Despite these warnings, we haven’t come to terms with the fact that the world as we know it might change completely in the next fifty years. That’s a very difficult thing for us to imagine—that the world our children might inhabit will be radically different from ours.

CHRISTIAN: That’s a pretty emotional point. The book ends similarly, with a very personal statement by Rolf Soiron, who led the book’s concluding debate about the future of construction. In this discussion, you can find some phrases that are, in my opinion, rather surprising: Werner Sobek talks about the “ethical corruption” of architects who work on projects they know are not in the public’s best interest. Nirmal Kishnani talks about the “integrity of stakeholders” in terms of the moral fundaments of certain representatives, and Marc Angélil talks about “entering enemy territory” when thinking about the architect finding his or her place in the economic sphere. We see those well-informed men struggling with the question of how to build in a world organized by capital. And, at this very moment, they refer back to emotional, philosophical, or moral arguments instead of trying to stay “matter-of-fact.” That seems very interesting to me, because usually they are pretty much into scientific engagement and here they suddenly seem to be a bit lost.

NATHALIE: Aren’t we all? Concerning the emotional appeal and ethics and integrity—I think it’s important, especially in terms of finding alternatives to a pure market logic. “Integrity” and “ethics” are important values that architects, planners, investors, and other people involved in the built environment need to integrate into their work. If you’re an architect or a planner and you’re providing a service, but not considering your client—how she or he can access and afford such a service—then you are part of the problem. So if you build a house but plead ignorant about housing finance, that, in a way, is part of the “ethical corruption” in architecture and planning that Sobek refers to.


CHRISTIAN: It’s interesting that the reason this “ethical corruption” happens is always based on one’s own life. That’s why I’d like to talk about Airbnb as a case study of the “sharing economy.” There is an ongoing debate about when Airbnb is legal or illegal. Different cities are finding different ways to cope with this phenomenon. That’s one side of the story. On the other side, we see a lot of people who rent out their flats in order to earn much-needed money. When we look at the diagrams in the book, we can see that the individual decision to rent out one’s home is often driven by the renter needing extra money to pay his or her own rent or mortgage (this constituted 56 percent of the reasons given). This latter point is little-discussed in the debate around Airbnb. Furthermore, I think this is a comparable situation to the one you described with the corrupted architect. Maybe he just needs to earn money?

NATHALIE: We often have to make decisions based on what makes the most financial sense for us at that time. But that’s not a passive decision. That’s an active one. So we need to think about how we integrate our values into our daily decisions. For example, when we buy apples, do we choose the ones that are cheaper but have been flown here or choose ones that are local and have a smaller carbon footprint? Those are decisions that we need to make. The reason why we included the Airbnb report on San Francisco and the sharing economy is because we wanted to explore “sustainable construction” in a broader way: not just how we build, but how we inhabit buildings, how we demolish or recycle them. Usage becomes important in terms of economizing the built environment. There is a whole movement around the sharing economy that asks, for example, why do we individually consume things like a washing machine when we can share one among fifteen families?

CHRISTIAN: A lot of people are renting out their homes to make ends meet and they are not necessarily okay with it. So, isn’t this—parallel to all the positive effects of the sharing economy—just another neoliberal force that we are abandoning ourselves to? We are making our home a commodity, and we are selling it. Isn’t that a problem? That’s why I think the Airbnb case study is interesting because it very tangibly shows the two-sidedness of all these personal and legal decisions.

NATHALIE: But housing already is a commodity; that’s part of the reason why rents are rising faster than wages. It’s problematic that people have to have to rent their belongings or apartments to make ends. That is not itself a problem with the sharing economy, but with the fact that people are profiting on increasing rents while wages remain low. There needs to be stronger wage legislation, fair compensation for work, and there needs to be some kind of rent control because the way rents are increasing at the moment—in Berlin, London, New York, and across the world—is not sustainable in the long term. In London, for example, many middle-class families have to look far outside the city center for affordable rents. If people—nurses, firefighters, teachers, and so forth—cannot live in the areas where they work, what kind of city is that? Of course, the financial pressures that encourage the sharing economy need to be dealt with. But people are also renting all kinds of things, like gardening equipment, bikes, and cars. These are consumer goods that we use extravagantly; it would be more ecologically sound if we produced and consumed fewer of them. So if people want to share, that’s good for us! I’d rather borrow a car than own one.