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Six priority AI strategies could cut construction costs by 20%, study finds

“The companies and teams that act now will help define the future of construction”

The joint study “Construction in the age of AI” examines how artificial intelligence is reshaping construction performance and productivity, and identifies six priority areas where AI shows the greatest near-term potential.

Released by the builder Suffolk, in partnership with the MIT Center for Real Estate and MIT Media Lab City Science group, the study draws on academic literature, case studies, interviews, survey input, and an industry roundtable.

“AI presents a real opportunity to transform the way we build. The most meaningful progress will come when the entire ecosystem aligns around better data, smarter workflows, and shared accountability,” said Suffolk chair and CEO John Fish.

The study’s authors say the construction industry continues to face declining productivity, fragmented project delivery, limited technology investment, and persistent pressure from rising costs and labor shortages.

Long approval timelines, siloed data, and disconnected workflows have made it difficult for owners, builders, designers, and regulators to improve performance at scale. AI has the potential to solve these challenges, say the authors, helping teams process information faster, coordinate work earlier, and make better decisions across a project’s life cycle.

“Fully realizing this opportunity will require us to rethink how projects are planned, coordinated, and delivered, enabling us to build with greater speed, efficiency, and precision,” Fish said.

Six priority strategies for AI

  1. Design automation • Evaluate design options earlier, balancing cost, constructability, performance, and code requirements.
  2. Offsite manufacturing • Support prefabricated and modular construction by connecting design, production, and delivery.
  3. Permitting • Interpret building codes and support more efficient compliance and permit review.
  4. Scheduling • Create more responsive schedules that identify risk and coordinate sequencing, labor and materials as conditions change.
  5. Skilled labor and subcontracting • Reduce administrative work and help field teams and trade partners access the information, materials, and approvals they need when they need them.
  6. Supply chain and procurement • Connect design decisions to available products, helping teams plan around what can be sourced, manufactured, and delivered.

In one sample multifamily project, Suffolk’s model suggests the combined application of the six AI-enabled strategies above could create 17% to 20% total cost savings and 22% to 25% total schedule savings. These improvements have the potential to improve project predictability and feasibility, even in markets where modest changes in cost and timing can determine whether a project moves forward.

James Scott, co-lead, MIT Center for Real Estate, says this study is important because it connects academic research with practical industry evidence.

“The next step is to keep building the data foundation needed to understand where AI has the strongest impact, where the limits still are, and how those findings can be translated into better decision-making across real projects,” Scott said.

The study suggests that AI will have the greatest impact not as a single tool, but as a connected system of capabilities that improves project planning, delivery, and performance across the full life cycle.

“The opportunity now is to move from isolated AI use cases to integrated workflows that create measurable value across design, procurement, scheduling, and execution. That is where AI starts to become operational, not theoretical,” said Suffolk EVP and CTO Jit Kee Chin.

Download the full study “Construction in the age of AI” at suffolk.com (PDF).

“The companies and teams that act now will help define the future of construction,” Fish added.