Artificial intelligence is rapidly emerging as one of the most transformative forces in the built environment—reshaping how buildings are designed, constructed, managed, and operated. A recent report from the Sustainable Markets Initiative’s Buildings Hub spotlights this shift, documenting real-world applications of AI that go far beyond automation to reimagine the entire lifecycle of buildings. From energy-saving retrofits that have delivered 20–30 % reductions in consumption within a year to advanced generative design tools that enhance architectural creativity, the findings signal a major paradigm shift at the intersection of technology, sustainability, and commercial real estate.
Titled Building Intelligence: Applying Artificial Intelligence to Revolutionise the Built Environment, the report highlights a striking market forecast—with AI in smart buildings and infrastructure projected to grow from $41.4 billion in 2024 to nearly $359 billion by 2034, driven by technological advances and increasing demand for efficiency and sustainability in a rapidly urbanizing world.
Professionals in the built environment are increasingly using AI not just to automate routine tasks but as a collaborative tool throughout the entire building lifecycle, from concept and design to long-term operation and maintenance.
In 2024, the market for AI in Smart Buildings and Infrastructure was valued at $41.4 billion and is expected to be worth around $359 billion by 2034. This growth is fuelled by advances in core technologies, such as faster processing power and lower data storage costs, that have made AI more scalable and accessible.
AI’s integration across the building lifecycle can significantly reduce environmental impact, optimise energy use, and extend asset lifespans. With real-world examples showing that AI retrofits can deliver 20–30% energy savings in under a year. Other use cases for AI include, autonomous AI technology for commercial heating, ventilation, and air conditioning, AI-driven visualizations and generative wind-informed architectural design.
However, to fully realize AI’s potential in the built environment, coordinated action is required across technical, operational, and regulatory domains. The SMI Buildings Hub recommends the following priorities to accelerate responsible AI adoption:
- Adopt Responsible AI Principles
- Use AI for Supervisory Control and FDD
- Apply Agentic AI to Improve Productivity
- Select the Right Algorithms and Prioritize Data-Efficiency
- Enabling Conditions for AI Integration in Buildings
Jennifer Jordan-Saifi, M.V.O., CEO of the Sustainable Markets Initiative, said, “AI has the potential to fundamentally reshape the buildings and construction sector. This isn’t just about efficiency—it’s about sparking unprecedented innovation that turns environmental stewardship into a core commercial advantage.”
“AI transforms building performance and lifecycles, boosting sustainability, efficiency, and cutting waste, leading to unmatched economic benefits for owners and managers,” said Dave Regnery, chair and CEO of Trane Technologies. “This isn’t just tech hype; it’s a reality proven by today’s AI-driven successes.”
“Artificial intelligence is a catalyst for real, measurable progress in the built environment. By harnessing data and technology, AI helps to create buildings that are more sustainable, resilient, and that are strategic assets. The progress we’re seeing is not just about efficiency, it’s about freeing up precious resources to fuel business growth,” said George Oliver, retired chairman and CEO, Johnson Controls.
“Architecture is constraint-driven exploration and so is GenAI. By iterating through options at scale, AI amplifies the designer’s process and frees time for higher-order decisions, without displacing the architect’s critical judgment,” said Irene Gallou, head of Specialist Modelling Group, Foster + Partners.
As leaders and practitioners in the built environment, members of the Sustainable Markets Initiative Buildings Hub are uniquely positioned to shape how AI is adopted and applied across the industry. To harness AI’s potential responsibly and effectively, the Sustainable Markets Initiative Buildings Hub endeavours to:
- Champion ethical and transparent AI practices that prioritize safety, privacy, and sustainability.
- Invest in capacity building, ensuring teams are equipped with the knowledge and skills to use AI tools wisely.
- Collaborate across disciplines and organizations to share best practices, align on standards, and ensure interoperability.
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