I’m not sure how other software does this, but I presume they must have the ability to exclude the project area from the 3D tiles visualisation.
It looks very strange to have the existing situation (for example a building that must be demolished) showing overlapping with the design models.
I’d expect to be able to define a polygon (on the 2D horizontal plane) that acts as a clipping mask or something. Could be a 3D volume as well it that is easier to implement, as long as that object then can be hidden.