In Germany, as in many developed countries, over 60% of buildings were constructed before 1978, where most are in critical condition, requiring either demolition with plans for redevelopment or renovation and rehabilitation. Given the urgency of climate action and relevant sustainable development goals set by the United Nations, more attention must be shifted toward the various sustainability aspects when deciding on a strategy for the renovation or redevelopment of existing buildings. To this end, this study focused on developing a smart decision support framework for aging buildings based on lifecycle sustainability considerations. The framework integrated digital technological advancements, such as building information modeling (BIM), point clouds processing with field information modeling (FIM)®, and structural optimization, together with lifecycle assessment to evaluate and rate the environmental impact of different solutions. Three sustainability aspects, namely, cost, energy consumption, and carbon emissions, were quantitatively evaluated and compared in two scenarios, namely, renovation, and demolition or deconstruction combined with redevelopment. A real building constructed in 1961 was the subject of the experiments to validate the framework. The result outlined the limitations and advantages of each method in terms of economics and sustainability. It was further observed that optimizing the building design with the goal of reducing embodied energy and carbon in compliance with modern energy standards was crucial to improving overall energy performance. This work demonstrated that the BIM-based framework developed to assess the environmental impact of rehabilitation work in aging buildings can provide effective ratings to guide decision-making in real-world projects.