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Retrofit, Renovate, Replace, Managing Aging Buildings

Grainger Editorial Staff

Buildings are constructed with a particular service life and purpose in mind, yet many buildings are kept in operation far past their peak effectiveness. In 2012, about half of all commercial buildings were built before 1980, according to the U.S. Energy Information Administration. The decision to bring an aging building up to modern standards or to tear it down and start over is a complex one involving long-term financing and opportunity costs.

Managing aging buildings requires a close look at the risks, benefits and costs associated with making certain upgrades. Ultimately, you will need to decide between three options: retrofit, renovate or replace. While the best answer will depend on your specific facility and needs, taking a step in one of these directions can make your workplace safer, more effective and friendlier to the environment and your budget.


When you need to update a building to make it safer or more functional, retrofitting may be the first step. A retrofit can dramatically extend the lifespan and utility of your existing building without the cost of replacement or the downtime of renovations. Retrofitting also brings benefits to comfort, function and sustainability, increasing the service life of your building and adding to cost savings.

In its simplest form, a retrofit replaces one system with an updated version. An example of this might be swapping lighting and equipment for modern equivalents. Because systems are updated individually, a retrofit minimizes impact on production and can be a cost-friendly option to increase the lifespan of a building.

According to Energy Star, the most common retrofits are to lighting systems, HVAC and equipment, with a focus on reducing energy use. These systems tend to be the most inefficient, and modern replacements are widely available and can significantly cut energy use. Older lighting systems, according to Grainger , can be replaced with LED equivalents that use less energy and instantly turn on and off. HVAC systems that are out of date can be swapped with energy-efficient models that are capable of learning from your usage patterns while also reducing waste. Other equipment, including assembly and storage equipment, can also be replaced with upgraded equivalents that reduce heat waste or power usage. The exact retrofitting options available to you will depend on your facility.


Renovation involves removing and replacing entire parts of a building. These changes can include parts such as walls, wiring and fixtures in order to increase the amount of usable space or to replace outdated electrical and plumbing systems. Renovations are construction projects, and unlike retrofits, may not have off-the-shelf solutions. In 2010, the U.S. Department of Energy found that over 60% of all commercial construction projects started in the year were renovations, highlighting the popularity of renovation over replacements or retrofitting. 

Renovations may be appropriate when a building is still within its service life but is no longer adequate for the type of work it's supporting. In these cases, renovations can allow you to expand your space in order to fit new or different equipment or to rearrange rooms and wiring for an entirely new use. Some buildings built before the 1990s may need renovation to remove toxic lead and asbestos used in construction. According to the Environmental Protection Agency (EPA), renovating facilities with lead or asbestos present can require special precautions or permits. When removing lead or asbestos, crews need to be trained and certified in handling toxic materials. Special gear, such as impermeable suits and ventilators, must be worn to prevent exposure. According to the EPA, asbestos emissions must be managed during renovations, and both asbestos and lead waste must be properly labeled, stored in airtight containers and removed from the site as soon as possible.

Renovations are more time consuming and costly than retrofits. Areas of the facility will need to be closed off and demolished, and construction can take weeks or months. Renovations, however, also allow for more extreme changes and can keep an aging building in service for longer. 


In the most severe cases, buildings may need to be entirely replaced or shuttered. This happens when a building becomes too dilapidated, unsafe or inadequate for operations. Replacement is a time-consuming step, requiring a demolition or appropriate lockdown. If required, a new facility needs to be planned, permitted and constructed. It's important to scope the environmental and productivity impact, which can be subject to investor or public scrutiny. 

Replacing buildings is an expensive option that should only be considered when all other options are deemed ineffective. If your facility faces replacement, consider long-term objectives upfront. Prioritizing expected capacity, sustainability goals or growth in the future can increase the lifespan of the new building and prevent another future replacement. New buildings also have costs that go beyond materials. Taxes and land costs can add significantly to the construction bill, and new plumbing and electrical services or roads may need to be built. Depending on the scale of the new building, parking and drainage must be considered far beyond the building's footprint. The costs and risks of building a new facility are unique to your facility and your needs, and the project requires its own plan.

How to Decide

Several factors will impact your decision to retrofit, renovate or replace an aging building. The most significant factor to consider when making your decision is cost. Each option comes with significant budget considerations, but the costs of renovating or replacing a building can be multi-year commitments. Before making your decision, ensure that you factor all of the expenses into each option, including labor, parts and downtime. 

The timeline is also a major factor in deciding whether to renovate or replace. Some retrofitting efforts will take less than a day, while other efforts such as replacement can take months or years. Depending on how soon you need the space back in service, certain options may be prohibitive. Before planning any change, ensure that you know the acceptable downtime for the building and factor it into the plan.

Beyond cost and time considerations, your goals also play a major role in determining which option is best. If your facility is planning to expand production, shift into new products or add storage, retrofitting may not be enough. Instead, a renovated or replaced building can better serve your needs in the future. Likewise, if sustainability is a key goal of your facility, that objective can be factored into the decision and may lead you toward retrofitting and renovation. If you intend to keep facilities in operation throughout construction, certain options such as replacement are impossible without building on a different site or relocating staff.

Learn more about how to mitigate the risks of maintaining your aging building. Download the industry report: The State of Aging Buildings: Today’s Building Management Challenges.

The information contained in this article is intended for general information purposes only and is based on information available as of the initial date of publication. No representation is made that the information or references are complete or remain current. This article is not a substitute for review of current applicable government regulations, industry standards, or other standards specific to your business and/or activities and should not be construed as legal advice or opinion. Readers with specific questions should refer to the applicable standards or consult with an attorney.


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