Circular Depreciation in the Municipality of Heerenveen: “Materials Retain Their Value”

Materials in buildings retain value, even after fifty years. Yet municipalities often write off buildings completely. The municipality of Heerenveen does it differently. They only depreciate down to the value the materials still have. This remaining value creates room for circular choices, without exceeding the budget.

We spoke with Marjan Draaijer-de Vries, Program Leader for Circular Society, and Lennert Marinus, Program Manager for Educational Housing, about their experience with circular depreciation.

What does financial residual value mean to you?

‘Normally, you depreciate a building to zero over fifty years. We depreciate down to the value that the materials still have at that point. We calculate the residual value based on the purchase price, minus costs for dismantling, transport, and storage. Reusable materials yield more than recyclable ones. That creates financial space—if you invest five million euros, five percent residual value already gives you 250,000 euros. We use that space for better materials, demountable constructions, or biobased insulation.’

What prompted you to start this?

‘Our municipal council decided to make circular building the standard. Not as a future ambition, but as the new normal. We want to be a leader in the circular society.

All Frisian municipalities are members of the Circular Friesland association, together with almost two hundred other members such as SMEs, construction parties and educational institutions. In the Friesland Builds Circular program, as clients, we look at how we can procure and build circularly. Every municipality participates in pilots. We do this with educational housing.

We heard that the municipality of Leeuwarden was working with financial residual value. That sounded interesting. We started exploring it with our finance department. Is this possible? What does our accountant think? It was exciting. How can you be sure that materials will still have value in fifty years? But actually, it makes sense: you don’t write off your material to zero, do you? Even if you recycle it, it still has value.’

How did you approach it?

‘It had already been done in Leeuwarden, but for our accountant, circular depreciation was still new. There were risks involved, and accountants want to build in safeguards. That’s why we had many conversations to justify it properly.

We built in certainty in four ways:

• Material passports in which all used materials are recorded;
• Assessment of costs and assumptions by a construction cost expert;
• Transparent sources for the residual value;
• Conservative calculations: our percentages are lower than what materials are probably actually worth.

With these steps, we were able to convince the accountant. In 2024, we included it in the budget. Last year, all major accounting firms and the Central Audit Office approved the methodology. Every municipality in the Netherlands can now get started with it.’

Child Center De Buitenkans in Heerenveen: circular school building with wood, biobased insulation, and 70% demountable building components.

Can you give an example?

‘We mainly apply circular depreciation in educational housing. We renovate and build many schools, so we can try out a lot. Ten years ago, a school mainly had to look nice, but now circularity is just as important. Children grow up in these buildings, where you can show how circularity works. As a municipality, you want to set a good example.

Child Center De Buitenkans is a good example. Primary education and childcare are under one roof here. We renovated 1795 square meters and expanded by 660 square meters. We chose wood for the supporting structure, the facades, and the frames. For insulation, we used biobased materials. Seventy percent of the building is demountable. The financial residual value is 7.4 percent of the investment.

Another school, Child Center Albertine Agnes, won a European award in September 2025. There, we chose straw as insulation material. The fire department found it exciting because this is rarely done in the Netherlands. We had to prove that it was safe enough. That meant bringing in specialists, making calculations, and explaining why it works. For this project, ten meetings were needed and it took five extra months. But the permit was granted, and the project as a whole ultimately earned a European prize.’

Child Center Albertine Agnes was awarded for its sustainable and circular new construction.

What challenges did you face?

‘The market is quite conservative. Change takes time. Some circular solutions are technically easy to apply if engineers have the right knowledge and mindset. But getting a permit can be difficult because you’re doing something out of the ordinary.

That takes time and perseverance. You have to search, select, and check whether solutions comply. You have to dare to keep asking, even if someone initially says “no.” Projects therefore take a few months longer. It doesn’t always work out. But even if it doesn’t, we’ve investigated it and learned from it.

We also have clashes with other parties. For example, the aesthetics committee wanted fewer solar panels on the roof because it wouldn’t look nice enough. You have to work that out together. And if you manage to convince people, that’s great too. It takes time, but we’re building for fifty years. Whether you finish six months earlier or later doesn’t matter. Content comes first, and taking that time pays off.’

What tips do you have for buyers?

‘From the start, choose partners who take circular building as a starting point. When selecting market parties to work with, such as architects and engineers, focus on their circular expertise and on quality over price. In tenders, we also actively challenge the market to come up with better, circular solutions.

Make sure the whole organisation adapts. Invest in training, from procurement to asset management, and make circularity and demountability conditions in your request. At completion, document an up-to-date material passport in your management system so that materials can really be reused later.

Work with partners who add knowledge and strengthen each other. For example, involve a knowledge partner for residual value or material passports, develop solutions together, learn from each other’s expertise, and use data from practice.

Dare to start. It may feel daunting, but accountants have now embraced the method. It is permitted, it is auditable, and it works in practice.’

And if you look further ahead, how do you see the future?

‘The next step is to calculate the actual residual value for all buildings. Then you can compare materials. One product may be more expensive to purchase, but it yields more at the end. We are also working on a definition of “the circular school.” Together with other municipalities, advisors, and contractors, we are putting this on paper. That helps the movement forward.

In addition, we are going to work on public spaces. We hope more municipalities will join so that we can help each other. Together, we are working on circular building, and that deserves more acceleration.’