Our topic for today: The impact of AI in Real Estate Development

• 💰 Latest VC-fundings related to AI construction tools

• 🤖 Research Reveals Growing AI Use in Construction

• 🛠️ The 3 Phases to bring real estate construction with AI to the next level

• 🔮 Future? Variety beats One-Size-Fits-All

• ✏️ Prompt of the Month

In this issue, we reveal the latest advancements driving efficiency at every step — from site selection to due diligence. Imagine tracking neighborhood trends, assessing environmental impact with digital twins, and leveraging NLP for market insights — all powered by AI.

Curious how AI could elevate your projects? Dive in and discover how to stay ahead in this tech-driven landscape!

Buildots I 15 Millionen USD I Israel I Series unknown:
Buildots uses a 360-degree camera and AI to digitally monitor construction, optimizing processes, reducing delays, and preventing budget overruns.

BuildPass I 7,5 Millionen USD I Germany I Seed round:
AI-powered software for construction site management, streamlining tasks such as safety, asset tracking, quality assurance, and daily operations to increase efficiency and compliance.

syte I 5 Millionen USD I Germany I Seed round:
AI solution for optimizing real estate portfolios and enhancing property management efficiency.

PinPoint I 3,2 Millionen USD I United States I Seed round:
AI-driven platform that streamlines construction data management and analysis, helping contractors optimize bids and profit margins while enabling municipalities to create accurate project budgets and reduce financial risks.

Research Reveals Growing AI Use in Construction

• Bluebeam's latest research reveals that 74% of construction firms now use AI, primarily in design and planning. While AI is transforming the industry, regulatory issues and talent shortages hinder wider adoption. Most firms plan to increase AI investment, but a significant skills gap and reliance on paper-based processes persist.

• OpenAI released new research function: ChatGPT can now search the web in a much better way than before. You can get fast, timely answers with links to relevant web sources, which you would have previously needed to go to a search engine for

The 3 Phases of AI-Powered Construction

There are many ways real estate development companies can leverage the power of AI in the development process. Here are some uses cases for the early stage of the development process:

Phase 1 - Searching for locations:

Use AI to detect up-and-coming regions or neighborhoods. How?

• Forecast economic trends and real estate prices with historical data (also known as time series data) based on macroeconomic variables

• Observe changes in pedestrian flows e.g. in city center locations with the use of mobile phone data

• Know how public opinion towards economic developments or certain neighborhoods changes using sentiment extracted from news and social media 

• Detect announcement in news or from public authorities early (Subsidies, construction measures e.g. for public transport)

Who can assist you here? Look at companies like prea or entera.

What’s the AI in here?

• For point 1 and 2 - conventional machine learning approaches to make forecasts respectively highlight changing behavior

• For point 3 and 4 - different NLP (natural language processing) approaches to classify news respectively find latest publications about a certain topic

Phase 2 - Searching for properties:

Use AI to spot potential properties within a region or neighborhood. How?

• Find empty lots and brownfields based on satellite images

• Estimated energy efficiency of buildings using street view images

• Combine both to detect potentials areas and roofs for photovoltaic systems

Who can assist you here? Look at companies like syte.

What’s the AI in here?

• AI can help to scan large areas and thousands of buildings. In particular image recognition techniques are used to create additional insights for first estimations (such as building age, condition, materials)

Phase 3 - Optimized property DD:

AI can streamline the property due diligence process by automating document analysis, detecting legal issues, and analyzing risks associated with properties:

• Automatically structure deal rooms and extract key information from e.g. leases, zoning laws, environmental reports, … and get an automated red flag report. 

• Assess the environmental impact of a property, considering factors like energy efficiency, water usage, and the potential for renewable energy integration, through digital twins of buildings.

Who can assist you here? Look at companies like AlphaPrompt, Predium, Metabuild or Alasco.

What’s the AI in here?

• AI, in particular large language models, can help you structure your information and scan for predetermined red flags. Also AI is used to create building models and simulate their efficiency.

Variety beats One-Size-Fits-All

The above mentioned examples highlight the wide range of AI-applications in real estate and that there is not (and probably will not be) the one “super-AI” solving all your problems (luckily otherwise your daily work might get pretty boring).

Instead it’s about integrating AI into your workflows and then step by step connecting those flows (maybe even with the use of another AI). Only then you will get a very powerful solution.

Prompting isn't just about crafting a single query to solve a problem. Often, ChatGPT can now search the web for you! Similar to perplexity.ai, this features now browses the web to find latest information, before answering your question - no more clicking through an endless list of blue links!

If you prefer short answers ChatGPT is probably the best tool. If you want more information perplexit.ai is probably the better search engine for you! Try it out: 

P.S. don’t forget to click the globe icon before starting the ChatGPT search.

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Thank you for joining our Propagator newsletter. Stay tuned as we continue to explore the technologies shaping the future of real estate.

See you next time!

Nino, Cosima & Jan
Your Propagator - Team