Keywords

1 Introduction

The focus of this research lies on urban epicenters, such as Zürich, which are marked by a high demand of both residential and commercial real estate. In these urban landscapes, several challenges - regulatory, logistical, and fiscal - often hinders the advancement of investments in construction initiatives. This phenomenon leads to a widespread issue where numerous sites remain vacant for extended periods. By addressing the principles of the circular economy, this study aims to confront these challenges, investigating methodologies and new business models to repurpose these temporary vacant spaces into functional areas. This entails a reevaluation of site development strategies through inter-scalar tactics to advance circular economy, tapping into digitalization to show the benefits of temporary use with flexible structures and Nature-based solutions (NBS).

2 Literature Review

2.1 Flexible Structures and NBS for Temporary Use of Vacant Sites

The concept of implementing temporary, incremental, and flexible strategies for urban vacant land use is a practical response to the diverse conditions and contexts of vacancy, as explored by research. This model emphasizes flexibility and adaptability in urban planning and design, which is particularly relevant in the context of circular economy to manage vacancy [1].

Predominantly, the discourse around urban vacancy has been centered on shrinking cities, where socio-economic decline result in abandoned or underutilized spaces [2]. However, the scope of this research extends beyond these contexts to include growing cities, such as Zurich, where demand for urban space is high, yet the need for strategic vacancy management remains critical. This paper seeks to bridge the gap in existing literature by exploring how urban strategies can address vacancy in high demand urban areas by responding to challenges such as market uncertainty, rapid change in the needs, demands and user preferences.

Moreover, the model is more appropriate for public ownership, where uncertain transitional periods can be exploited [1], there is a gap in temporary use models suitable for institutional or private investors, who are interested in high financial returns. Therefore, this study considers the value dimensions, in particular the value creation mechanisms of temporary use for sites waiting for building permit approvals, planning, or financing.

Existing studies reveal a range of temporary urban solutions which have been explored and implemented. These temporary pop-up environments are characterized by modular structures which allows for temporary occupation and adaptability to different uses, needs and target groups, though international transferability is limited due to the importance of local context [3]. The case studies include temporary housing from shipping containers, event space, pop-up retail [4].

In this context, integrating NBS into urban development is a crucial strategy. As defined by the European Commission in 2015, NBS approaches use nature to address global challenges, providing economic, social, and environmental benefits. They are part of green infrastructure, targeting specific issues. The concept has developed further, as Langergraber et al., 2020 [5], under the European Cooperation in Science and Technology’s Circular City initiative, highlight. Here, NBS involves incorporating nature into cities and using natural processes to address challenges like the heat island effect through microclimate improvement, air pollution through carbon sequestration, social inequity, biodiversity loss in urban ecosystems [6, 7, 19]. Additionally, empirical evidence, as exemplified by Dwaikat et al., 2016 [8], indicates NBS`s potential to increase real estate values.

2.2 Multi-scalar Impact Investments for Temporary Vacant Sites

The business case for circular economy models for flexible, temporary use including NBS for real estate investors remains challenging. Most of existing flexible re-use solutions are on temporary vacant sites waiting densification approvals rather than being permanent solutions. We identify here an opportunity to prove the feasibility of a more adaptable, incremental, and flexible urban development. To address this challenge, the review is addressing the recent paradigm shift in the real estate industry from the responsible to impact investments. It is driven by emerging regulations such as the EU Taxonomy [9], aiming to channel capital investments into decarbonization, circular economy or biodiversity measures. The challenge lies in balancing these sustainable measures with financial yields. Impact investments, aiming for social or environmental impact in addition to financial return, is not a new concept, it was only coined in 2007 by the Rockefeller Foundation [10]. This approach aligns with the concept of social entrepreneurship, which integrates profit-making with philanthropic goals, a principle increasingly applicable to real estate development. Entrepreneurial management, essential in real estate development, is highlighted in this context [11, 12] (Fig. 1).

Fig. 1.
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Classification of sustainable investments, based on the European SRI Study 2012, INREV.

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The financial sector is exploring the potential of innovative impact investment products by increasing risk and entrepreneurship [13]. The challenge is to find the balance between directing capital towards these measures without compromising yields. One strategy is tapping into the multi-scalar value generation of urban transformation solutions integrating NBS. The temporary use sites act as a platform for new impact invest products to be tested and developed.

2.3 Capturing the Multi-scalar Value with Digitalization

Numerous studies have highlighted the necessity and challenges of evaluating the diverse impacts of urban interventions across various scales. Hayek et al. (2015) [14] explore the intricate relationship between real estate supply and open space, assessing urban interventions from individual parcels to city regions. Despite these efforts, accurately valuing these impacts at multiple scales remains difficult. Recognizing the importance of considering both local context and broader implications, this study seeks to transform these challenges into a business opportunity. It aims to investigate the potential of digitalization to assess and capture the multi-scalar value of urban interventions on temporary vacant sites.

With the advancements of open standard data models, which solve the interoperability issues, Noardo et al. (2020) [15] discuss the integration of 3D city models and GIS datasets with Building Information Models (BIM) through GeoBIM, enabling inter-scalar urban analysis. The use of AI algorithms can further enhance our interpretation of the urban environments [16]. The successful translation of the multi-scalar urban analysis synthesis into design criteria can benefit from the advancements in parametric and algorithmic design [20]. Particularly concerning the circular economy and the variety of temporary re-use scenarios of vacant sites, the application of parametric and algorithmic design can be used to control and optimize various aspects of a project in early stages, allowing for the exploration of multiple design scenarios and alternatives [17]. The decision-making process can be supported by using these technology enabled insights to manage the trade-off between the financial impact and the environmental gains, for example balancing urban densification scenarios with NBS.

The already established BIM and Digital Twins technologies have significant potential for enhancing the construction and maintenance of flexible structures and NBS on temporary vacant sites. BIM provides a detailed 3D model and a Common Data Environment (CDE) with digital information useful for project management, monitoring, and operation across the entire lifecycle of a project. When combined with Digital Twins, this approach contributes to a circular economy by facilitating optimized asset management, enabling stakeholders to visualize, share data, and monitor conditions in real-time, leading to efficient cost management, reduced project delivery time and disassembly [18] in particular relevant for temporary re-use.

3 Methods and Research Approach

A comprehensive mixed-method approach was utilized, combining literature review, case studies, and design thinking methodologies as outlined in Table 1.

Table 1. Research Design.
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4 Results and Discussion

4.1 Multi-scalar Value Generation of Temporary Uses in Vacant Real Estate

Limited Scope and Multi-scalar Impact.

The findings indicate a constrained scope and impact across multiple scales. From a total of 38 cases, the majority is temporary office space. In addition, storage space and very few residential, retail and parking is being offered for temporary use. In terms of rent per square meter, the revenue generated is relatively low, barely covering the operational costs of assets that are non-sustainable and awaiting upgrades, repurposing, or demolition (Table 2).

Table 2. Multi-scalar value generation of temporary use in vacant real estate.
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Moderate Scope and Multi-scalar Impact.

The flexible uses of vacant sites offer opportunities for innovation, new business models, new site uses which generate a moderate multi-scalar impact as analyzed in Table 3.

Table 3. Multi-scalar generation of temporary use in vacant sites after demolition.
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High Scope and Multi-scalar Impact.

NBS interventions deliver significant multi-scalar impacts. Even small green interventions at the plot-scale contribute to a broader ecological network, addressing various socio-ecological challenges as confirmed by literature [21]. These include biodiversity preservation and ecosystem services, improved air quality, and enhanced health and well-being for residents. By integrating the diverse values of NBS into urban strategies through vacant land use, urban resilience is strengthened by promoting adaptability and flexibility (Table 4).

Table 4. Multi-scalar impact of NBS on vacant sites.
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The main findings are summarized in Fig. 2.

Fig. 2.
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Multi-Scalar Impact Investments.

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4.2 Scenario Planning with Digitalization

Multi-scalar Site Analysis. Utilizes GeoBIM and AI algorithms to understand the site constraints and possibilities ranging from local to the regional scale.

Multiple Scenario Generation. Utilizes parametric and algorithmic design to create multiple temporary use scenarios, factoring in owner requirements, market trends, demand, site limitations, and regulations.

Multi-scalar Impact Assessment. Evaluates scenarios based on cost-benefit analysis and overall value generation, identifying the solution with high financial return and high environmental impact.

Matchmaking. The platform connects suppliers of temporary, modular structures and owners of vacant sites, promoting efficient resource utilization and temporary site use.

Detailed Planning and Execution. Facilitates collaborative planning for the chosen scenario via CDE enabled by BIM.

Maintenance. Digital Twins for managing the temporary use for the owner over the short life cycle.

Disassembly. After the temporary uses, facilitates the disassembly and listing of structures on the platform at different sites.

5 Conclusion

The study is centered on applying the principles of the circular economy to address the underutilization of vacant urban land while promoting a swift urban transformation. It explores the temporary use of vacant land in cities like Zürich as a testing ground for new real estate products and ideas, facilitated by emerging digital technologies. This approach minimizes physical planning and waste, providing innovative solutions to rapidly evolving user needs and demands. By using digital tools to analyze trade-offs between financial returns and the ecological impacts of various urban scenarios, the study advocates for NBS and more flexible urban development. This digital methodology aligns with the circular economy’s goals of maximizing resource efficiency and minimizing waste. Thus, the study suggests that the flexible and temporary use of land, particularly during periods of transition or uncertainty, is a valuable strategy for urban development. This approach is applicable not only to publicly owned lands but also to those awaiting development by private and institutional investors.

The paper introduces a new multi-scalar approach to manage urban vacant land. It proposes the use of temporary, flexible structures in conjunction with NBS as a strategic method to manage such spaces and their impact on local, district and city scale. This method is particularly beneficial in high-demand cities where it presents a sustainable solution for preserving open spaces while adapting to the changing needs, demands, and preferences. In conclusion, the strategic management of vacant spaces, as proposed in the study, is crucial not only for the functionality of urban areas but also for preserving valuable open spaces. This approach demonstrates the potential for temporary and flexible land use strategies within the framework of a circular economy, offering a model for sustainable urban development.