I'm working on this for a few days now. Most of the work so far has been research and a lot is possible. Right now I have a mechanism to spawn a building at any location and NPC's will properly walk around it (dynamic navigation meshes). I also implemented cutting down trees, the tree falling with physics, then the tree dividing in 3 wood logs after a few more cuts, which can be picked up and carried by the player or NPC's. I think I also figured out how to create horse-pulled carriages and hand-pushed carts and such. There are a lot of useful animations already in the game, but some new ones need to be made to make things look good (I don't yet know how to create new anims, and I have very little animating experience).