Urgent needs to mitigate climate change and reduce waste generation require collaborations between sectors. We examine the impacts of the potential recycling of ashes from the incineration of urban waste streams such as municipal solid waste, sewage sludge, and biomass within the construction sector. We perform material flow analysis to estimate the flows and stocks of ashes to identify underutilized waste streams. In this study, we use a multi-objective optimization model at the regional level (country level) to estimate optimal scenarios for urban waste recycling in the construction sector, with a focus on minimizing CO2 eq. emissions and costs. We combine geographic information systems and life cycle assessment (LCA) to examine the configurations of optimal supply chain networks, including direct symbiosis between waste producers and construction material manufacturers, as well as centralized waste recycling plants with recovery of valuable substances. We apply the proposed methodology to a case of sewage sludge recycling and phosphorus recovery in Denmark. Results show that recycling of sewage sludge ashes as supplementary cementitious materials with mineral recovery can bring up to 69% lower CO2 eq. emissions compared to business-as-usual ash landfilling and production of conventional cement construction materials and fertilizers. The methodology can be further applied to assess impacts with potential urban waste recycling in different regions. The results can provide indications to policymakers to encourage the establishment of new urban-industrial collaborations, promote sustainable waste management practices, and advance the goals of a circular economy.