Cement, bricks and AI: India's $650-billion real estate industry has a new formula
Artificial intelligence is transforming India's real estate sector beyond customer interactions. Developers now use AI for crucial decisions on building and project management. This technology promises faster launches and increased workforce produ...
In recent years, artificial intelligence (AI) in India's real estate sector was largely confined to the customer-facing side of the business. Virtual property tours, chatbots answering buyer queries, personalised recommendations and smarter digital marketing were among the first applications developers experimented with.
That was the easy part.
Now, a much bigger shift is happening behind construction barricades, inside project offices and across boardrooms where developers are increasingly relying on AI to decide what to build, when to build it, how much it will cost and whether a project is likely to run into trouble long before delays begin to show up on site.
The conversations around AI inside real estate companies have changed remarkably over the past year.
The opportunity is massive. India's real estate sector is currently valued at $650 billion, projected to become a $5.8-trillion industry by 2047, according to the India Brand Equity Foundation (IBEF). But to get there, developers will have to build more, build faster and build smarter. Increasingly, they believe AI can help do all three. A joint EY-Parthenon and CREDAI report estimates GenAI alone could add $14-17 billion to the sector's Gross Value Added over the next seven years by improving productivity, shortening project timelines and boosting sales.
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"About 18 months ago, developers were asking us, 'What can AI do?' Today, the question is, 'How quickly can we roll this out on our next project?'," Iesh Dixit, co-founder and CEO of construction management platform Powerplay, told ET Online.
That shift reflects a broader change across the industry.
According to the EY-Parthenon-CREDAI report, developers adopting GenAI could see 30-50% higher sales velocity, around 30% faster product launches, 20-50% gains in workforce productivity and 20-50% lower customer acquisition costs, driven by AI-powered customer intelligence, automated design workflows and predictive project monitoring.
"GenAI is fast becoming central to value creation and competitiveness, making inaction a growing strategic risk," said Chaitanya Seth, Partner, Real Estate at EY-Parthenon India. "This is not about incremental digitisation. It is about rewiring the operating model."
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The underlying reason is simple. Real estate has always been a business built on fragmented information.
Every project generates thousands of drawings, contracts, approvals, site photographs, procurement records, spreadsheets, WhatsApp messages and progress reports. Traditionally, making sense of all this depended heavily on experience and manual coordination.
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AI changes that equation.
Unlike older enterprise software that required structured databases and extensive employee training, today's AI models can understand engineering drawings, site images, voice notes and unstructured communication that construction teams already generate every day.
"The effort required to adopt new technology has reduced dramatically. When AI starts working with the information teams already create instead of forcing them to change their workflows, adoption naturally accelerates," Dixit said.
While AI-powered marketing remains important, developers say project execution has become the industry's biggest focus.
"Earlier, AI was largely associated with marketing automation or customer engagement. Today, developers want to know which two or three business functions AI can improve immediately," Argenio Antao, Chief Business Officer at Inkers Technologies, an AI-powered construction intelligence platform, told ET Online.
The answer increasingly lies in execution.
Developers are using AI to predict schedule overruns weeks before they occur, automate project reporting, analyse site photographs to identify quality issues, forecast procurement requirements and anticipate cash-flow gaps before they become critical.
The economics are becoming difficult to ignore.
According to EY, AI can reduce deal evaluation time by nearly 50%, shorten land-closure timelines by 30-35%, and enable developers to evaluate 2.5 times more land opportunities through automated feasibility studies and AI-generated financial modelling. Decision-making cycles that once took months could shrink to weeks—or even days.
Inkers estimates AI can reduce manual reporting effort by 30-40%, while projects using AI-powered monitoring have improved execution timelines by roughly 5-10% because project teams identify risks before they snowball into expensive delays.
Powerplay, meanwhile, said one of the biggest breakthroughs has come in estimation.
Tasks that previously required engineers to manually analyse architectural drawings over several days — or even weeks — can now be completed within hours and, in some cases, minutes. The company said its AI models, trained on data from more than 85,000 construction projects, are also helping automate procurement planning and cash-flow forecasting.
Developers say avoiding even a single Bill of Quantities (BoQ) error — which can run into crores of rupees — is often enough to justify investing in AI.
While the industry is still in the early stages of adoption, consultants say AI's biggest financial gains are likely to come from automation rather than replacing people. According to Vijay Gopalakrishnan, Partner, Consulting, Deloitte India, AI-led automation has delivered 10-40% effort savings in software development-related processes and 50-70% savings across several non-software business functions in other industries. The exact benefits for real estate, he said, would depend on the specific use case and how the technology is deployed.
"It is difficult to quantify exactly how much developers can save because every deployment is different. The savings ultimately depend on the AI use case and the deployment scenario," Gopalakrishnan told ET Online.
"The misconception is that AI replaces engineers. In reality, it removes repetitive work so engineers can spend more time making decisions that require judgment," Dixit said.
On the consumer side, developers are increasingly marketing intelligence as the next luxury feature.
An ET Bureau report in February found developers are integrating AI-powered biometric access systems, predictive maintenance, intelligent air-quality monitoring and smart home automation into premium residential projects as affluent buyers increasingly expect technology to be embedded into everyday living.
"AI is changing how homes are bought, and how they are lived in," Amit Goyal, Managing Director, India Sotheby's International Realty, had told ET.
Projects are beginning to incorporate AI-enabled lifts that recognise residents, predictive maintenance systems that identify equipment failures before they happen, and personalised home automation that adjusts lighting, ventilation and security based on occupancy.
Developers are also experimenting with AI well after possession.
Payas Agarwal, Director at Great Value Realty, said the company is exploring AI for predictive maintenance, analysing recurring customer complaints, improving buyer discovery through smarter search experiences and giving brokers real-time inventory visibility and pricing updates.
"Our focus is on integrating AI into day-to-day operations both in the office and on construction sites to improve quality, decision-making and customer experience," he told ET Online.
How much does AI cost?
One of the biggest questions for developers is whether AI is expensive to deploy. There is no standard answer.
Unlike traditional enterprise software, AI implementation varies significantly depending on the use case, project size and level of integration with existing systems.
"It is not possible to give a ballpark cost for AI implementation because it varies from client to client and use case to use case," Gopalakrishnan said.
He added that AI technology providers often support initial proof-of-concept projects with funding, making it easier for companies to experiment before scaling deployments.
According to Deloitte, AI solutions are increasingly being deployed cost-effectively across industries, including traditional sectors, with several projects already moving into production in both the public and private sectors in India.
Corporate real estate is changing too
The commercial real estate segment is witnessing an equally significant transformation.
According to JLL's Global Technology Survey 2025, the share of Indian companies piloting or planning AI-enabled corporate real estate solutions has jumped from less than 5% in 2023 to 91% in 2025.
Companies are increasingly deploying AI to optimise office portfolios, reduce energy consumption, automate lease management and consolidate real estate data across multiple locations, turning buildings into continuously learning, data-generating assets rather than static infrastructure.
The question that continues to shadow AI adoption is whether it will eventually replace people.
Industry executives don't think so.
Instead, they argue AI is becoming a productivity tool that removes repetitive work rather than replacing engineers altogether.
"AI is not intended to replace the workforce. It is meant to enhance productivity and unlock bandwidth so employees can focus on higher-value work," Gopalakrishnan said.
According to Deloitte, AI is likely to touch almost every function within a real estate company — from sales and marketing, including broker networks, to project management, procurement, site operations and collections.
Rather than reducing headcount immediately, AI is expected to automate documentation, reporting, project tracking and other repetitive tasks, allowing teams to spend more time on planning, execution and customer engagement.
That broadly echoes what developers are already seeing on the ground.
Powerplay says AI is helping engineers spend less time manually analysing drawings and preparing estimates, while Inkers believes AI-powered monitoring allows project teams to identify risks before delays become expensive.
Still early, but momentum is unmistakable
Despite the growing excitement, meaningful adoption remains limited.
Inkers Technologies’ Antao estimates only 15-20% of organised developers are currently using AI meaningfully across live projects, while another 30-40% are running pilots or limited deployments.
Powerplay shared a similar assessment.
Almost everyone is experimenting with AI. Far fewer have made it part of everyday project execution. That, however, may not remain true for long.
Deloitte believes the business case for AI will ultimately depend less on the technology itself and more on choosing the right problems to solve. According to Gopalakrishnan, companies that adopt AI in phases and deploy it around clearly defined business use cases can typically recover their investments within six months to a year, although timelines vary depending on the technology stack and implementation.
If the projected gains materialise, the impact could extend well beyond individual developers. As per EY estimates, GenAI could contribute $359-438 billion to India's GDP by 2030, with real estate emerging as one of the sectors where AI has the potential to reshape everything from land acquisition and construction to sales, maintenance and customer service.
Five years from now, developers may no longer talk about "AI-powered estimation" or "AI-driven procurement," Dixit said.
"It'll become like the internet. Nobody says they're using the internet to send emails anymore. AI will simply become part of how projects are run."
For an industry where delays, cost overruns and fragmented information have long been accepted as inevitable, that may prove to be AI's biggest disruption. Not replacing people, but quietly changing the economics of how India's cities are built.
