NYC’s AI Revolution is Transforming Construction Inspections: What Property Owners Need to Know

New York City is undergoing a technological transformation that’s reshaping the construction industry in ways property owners couldn’t have imagined just a few years ago. In January 2025, NYCEDC published NYC’s Artificial Intelligence Advantage: Driving Economic Growth and Technological Transformation. The report is a first-of-its-kind study and action plan that outlines the City of New York’s and NYCEDC’s strategy to secure and expand the city’s position as the global leader for Applied AI.

This AI revolution isn’t just about tech startups—it’s fundamentally changing how construction projects are planned, executed, and inspected throughout the five boroughs. For property owners, developers, and construction professionals, understanding these changes is crucial for staying compliant and competitive in today’s market.

The AI-Powered Construction Landscape

Governor Hochul announced a historic agreement with the Legislature to establish Empire AI, a first-of-its-kind consortium to secure New York’s place at the forefront of artificial intelligence research, as part of the FY 2025 Budget. The consortium will leverage a $275 million state investment to create and launch a state-of-the-art artificial intelligence computing center on the University at Buffalo’s campus. This massive investment signals the state’s commitment to integrating AI across all sectors, including construction.

The impact on NYC’s construction industry is already becoming apparent. The city has partnered with startups and a tech incubator to test drone and AI technology that guides energy retrofits, saving time and money compared with traditional assessments. These technological advances are streamlining processes that previously required extensive manual labor and time-consuming inspections.

How AI is Revolutionizing Construction Inspections

Traditional construction inspections have long been a bottleneck in NYC’s building process. The number of DOB staff in these types of positions (i.e., project managers, plan examiners, inspectors and estimators) declined to 519 people in March 2024, from 662 in March 2021. As of March 2025, the number of staff in construction positions is over 21% below the March 2021 level, suggesting that building approvals may remain slower going forward.

This staffing shortage makes AI-powered inspection tools more valuable than ever. Advanced AI systems can now analyze construction plans, identify potential code violations, and even predict structural issues before they become problems. For property owners working with professional inspection services, this means faster, more accurate assessments and reduced project delays.

When selecting inspection services for your construction project, it’s essential to work with companies that understand both traditional inspection methods and emerging AI technologies. Professional special inspections that incorporate these advanced tools can provide more comprehensive evaluations while maintaining the human expertise needed for complex judgment calls.

Regulatory Changes and Compliance Requirements

The NYC Office of Technology and Innovation (OTI) published “Preliminary Use Guidance: Generative Artificial Intelligence” in May 2024. Rather than prohibiting the use of AI by city personnel, the preliminary guidance outlines key considerations to guide agencies and their personnel towards the ethical, transparent and effective deployment of AI technologies.

This guidance affects how construction projects are reviewed and approved. In the first part of 2025, New York joined other states, such as Colorado, Connecticut, New Jersey, and Texas, seeking to regulate artificial intelligence (AI) at the state level. Specifically, on 8 January 2025, bills focused on the use of AI decision-making tools were introduced in both the New York Senate and State Assembly.

For property owners, this means staying informed about new AI-related compliance requirements. Projects may need to demonstrate how AI tools are being used in design, inspection, and safety monitoring processes.

The Economic Impact on NYC Construction

The construction industry’s embrace of AI comes at a critical time for NYC’s economy. Construction spending in the city reached a record high of $68.2 billion in 2023, partly due to rising costs, exceeding the pre-pandemic peak in 2019 by 10%. The number of construction businesses decreased by 3%, or 479 firms, in 2024, the first annual decline since 2011.

AI adoption is helping the remaining construction companies become more efficient and competitive. With a $2 trillion gross metropolitan product, the largest concentration of Fortune 500 companies in the nation, and global leadership across finance, healthcare, real estate, media, fashion, and more, NYC offers unrivaled opportunities for AI application and innovation.

What Property Owners Should Do Now

To prepare for this AI-driven future, property owners should:

• Partner with tech-savvy inspection services: Choose inspection companies that understand both traditional methods and emerging AI technologies
• Stay informed about regulatory changes: Monitor updates from the NYC Department of Buildings regarding AI integration requirements
• Invest in digital documentation: Ensure all project documentation is digitally accessible for AI analysis tools
• Consider AI-enhanced project management: Explore construction management platforms that incorporate AI for scheduling and quality control

Looking Ahead: The Future of NYC Construction

Empire AI will bridge this gap and accelerate the development of AI centered in public interest for New York State. Enabling this pioneering AI research and development will also help educational institutions incubate the AI-focused technology startups of the future, driving job growth.

The integration of AI into NYC’s construction industry represents more than just technological advancement—it’s a fundamental shift toward more efficient, safer, and more sustainable building practices. Property owners who embrace these changes now will be better positioned to navigate the evolving regulatory landscape and capitalize on the efficiency gains that AI-powered construction processes offer.

As NYC continues to lead the nation in AI adoption, the construction industry will serve as a proving ground for technologies that will eventually reshape building practices nationwide. For property owners, staying ahead of these trends isn’t just about compliance—it’s about ensuring their projects are completed faster, safer, and more cost-effectively in an increasingly competitive market.