Claus Henriksen
September 7, 2026
Time can consume 95% of a building transformation’s value
New Danish research shows how unresolved uncertainty can make viable building transformations lose out to new construction. Although the market data is Danish, the lessons apply to investors far beyond Denmark.
A research project from Ramboll, Nykredit, Ejendomsselskabet Olav de Linde, and Freja Ejendomme has identified a central reason why promising building transformations fail to attract investment: decisive technical, commercial, and regulatory questions often remain unanswered when capital must be committed.
The project forms part of Preserve More (in Danish: Bevar Mere), a Danish initiative exploring how more future homes can be created within existing buildings. Denmark may need up to 150,000 new homes by 2040, and an estimated 40,000 to 70,000 could potentially come from renovation, transformation, and conversion.
Investors can generally accept risk when they can estimate and price it. The real difficulty comes when decisive conditions remain unresolved at the point when capital must be committed, such as structural capacity, contamination, planning permission, building-code requirements, or the building’s actual suitability for housing
Chief Consultant in Sustainability Consultancy at Ramboll
“Until those questions are clarified, the project cannot be modelled, financed, or compared reliably with alternative investments. Transformation may offer comparable or even greater value, yet new construction often wins because it presents a more familiar and predictable range of outcomes.”
Can add costs and delay revenue
The cost of waiting can be decisive. In an anonymised, simplified case involving the conversion of a medium-complexity industrial building into housing, the initial calculation showed a gross value potential of approximately DKK 6.32 million.
Once two years of planning and approvals, around 18 months of construction, financing, property tax, maintenance, and other holding costs were included, the projected value gain had almost disappeared, leaving approximately DKK 0.31 million.
The exact result is specific to the case, while the mechanism is widely relevant: every additional month can add costs and delay revenue.
The project also produced the BEVAR (PRESERVE) framework, which helps investors, developers, and advisers screen five critical areas early: technical suitability, contamination, market value, space efficiency, and the regulatory pathway.
“The key contribution is the ability to identify the small number of conditions that disproportionately influence the outcome,” says Veenboer and adds:
“That allows investors to distinguish manageable challenges from potential showstoppers before significant time and money have been committed.”
What the PRESERVE (BEVAR) framework screens
- Building condition and load-bearing capacity
- Contamination and remediation
- Value and market demand
- Space efficiency and suitability for housing
- Regulation and municipal approval
Tipping points
- More proportionate building regulations
- Faster municipal processes
- Stronger public incentives (e.g. tax relief, lower fees or development-right bonuses) could reduce the cost and uncertainty of transformation.
At the same time
- Tighter carbon and demolition requirements
- Rising material costs and
- growing ESG demand may make resource-intensive new construction relatively less attractive.
Want to know more?
Daniel Veenboer
Chief Consultant
+45 52 47 57 80
