In the heart of the construction industry, a sector that has long been the bedrock of global economic growth, a quiet revolution is brewing. Artificial Intelligence (AI), which has already transformed industries from healthcare to finance, is now poised to tackle the unique challenges faced by construction. This isn’t just about adopting new tools; it’s about reshaping the very foundation of how we build and manage our environment.
Patric Hellermann, founding general partner at built environment venture capital firm Foundamental, draws a compelling analogy. “The construction industry is in its own ‘Internet 1.0’ era,” he says, likening the current state to the early days of the tech boom. This comparison isn’t merely rhetorical; it underscores the vast potential for growth and innovation that AI can bring to the sector.
The construction industry, often seen as traditional and slow to adopt new technologies, is now at a critical juncture. The global demand for infrastructure is skyrocketing. According to Hellermann, “We have to add one New York City per month for the next 40 years to keep up with population growth, migration, and the rising middle class—everywhere on the globe, not just SE Asia and Africa.” This staggering demand is compounded by a shrinking supply of qualified labor. In the U.S., 41% of skilled construction workers are expected to leave in the next decade. Europe is already short millions of skilled workers, and the UK is facing a significant retirement wave among its skilled workforce. The need for technological adoption is not just a matter of progress; it’s a matter of necessity.
So, where does AI fit into this picture? Hellermann points to several key areas where AI can make a significant impact. For general contractors (GCs), the bidding and estimation workflows, as well as the financial back office, are ripe for AI integration. These processes are notoriously complex and error-prone, often leading to costly miscalculations that can jeopardize entire projects. AI can streamline these workflows, providing more accurate estimations and reducing the risk of human error.
On the blue-collar front, AI-enabled on-site robotics is emerging as a highly promising area. While Hellermann notes that AI for document and contract intelligence is a crowded market with little differentiation, the potential for robotics in construction is immense. Robots can handle repetitive tasks, freeing up human workers for more skilled labor, and can operate in hazardous environments, enhancing safety on construction sites.
Dennis Lentz, chief digital officer at Heidelberg Materials, echoes this sentiment. Heidelberg Materials is leveraging AI in customer interactions, shared services processes, and key processes in its concrete business. Lentz highlights the importance of AI in reducing raw material costs and optimizing concrete mix designs for cost and carbon efficiency. “In almost a decade of driving digitalisation in this industry, this is the first tool I’ve implemented with a strong business case that comes with no change management, training and hence adoption barriers,” he says, referring to Command Alkon’s Batch AI and Giatec Scientific’s SmartMix AI.
But AI’s potential in construction doesn’t stop at the building phase. Dimitris Bountolos, chief information and innovation officer at Ferrovial, emphasizes the role of AI in operating sustainable infrastructure post-construction. Ferrovial is developing digital solutions that leverage AI and IoT to optimize highway operations, using Visual Large Models to detect incidents in real-time and improve road safety.
Fabian Lenz, managing director of Goldbeck Technologies, takes a holistic view. “AI is transforming both the construction process and building operations,” he says. “Improving efficiency and decision-making during construction, optimising workflows and reducing risks is as important as using automation and data to improve energy efficiency, maintenance, and tenant experience.” Goldbeck Technologies plans to significantly expand AI adoption across its construction business, recognizing that both construction and operation phases are crucial for innovation.
The integration of AI in construction is not just about adopting new technologies; it’s about addressing fundamental challenges in the industry. From labor shortages to the pressing need for sustainable infrastructure, AI offers solutions that can revolutionize how we build and manage our environment. As Hellermann notes, the construction sector’s killer app is yet to come, but the potential for AI to transform the industry is undeniable.
This revolution isn’t just about building smarter; it’s about building a better future. As AI continues
