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Report: Construction tech adoption accelerated due to COVID-19

The COVID-19 pandemic forced a lot of industries to pivot, including construction technology as it pertains to commercial real estate, according to JLL. The real estate services firm recently released its 2020 State of construction tech report, which captures how the pandemic impacted the construction industry as well as offers insights into the challenges of construction during a pandemic and where construction tech stands today.

“Due to the pandemic, three years of construction technology growth and adoption has been compressed into the past nine months,” Henry D’Esposito, JLL’s Construction Research Senior Analyst said in the report. “The technology categories that recorded the most growth due to the pandemic have been digital collaboration platforms, virtual scanning tools, and safety focused wearables. Venture capital funding has continued to flow to construction technology startups post-pandemic, with funding levels roughly on par with the average of the past five years. Most new funding has been concentrated in categories that have grown because of the pandemic.”

Construction tech year in review

Last year, JLL’s State of Construction Tech report forecasted a strong year of tech growth in 2020 due to low adoption barriers and more efficiency benefits at technology improved. These factors came to light in 2020, but unfortunately, so did COVID-19. The pandemic caused those factors to have less of an impact than the required changes that came about over the course of 2020. As D’Esposito noted, the urgency and severity surrounding the pandemic condensed technology adaption that would have normally taken three years at a standard pace into a single year.

“The pandemic pressed tech adoption onto every industry, but for construction the shift of office-based workers to a remote work environment was only one small part of the change,” D’Esposito said in the report. “To keep jobsites open and projects running, construction technology was needed to enable virtual inspections, provide contact tracing solutions, track project status remotely, and develop project plans to allow workers to maintain social distancing.”

As construction technology improved, acquisitions and growth has created an ecosystem of hubs and platforms so that construction firms will just need a few core tools to connect to their choice of one-off technology tools.

“Our 2019 report summarized the state of the market one year ago as. ‘After years of talk about the promise of construction technology, the reality on the ground has finally started to catch up to the hype,’” D’Esposito said. “Now nearing the end 2020, growth in construction technology on the ground, fueled by demand because of the pandemic, has far outstripped even the most optimistic forecasts.”

Pandemic impact on construction tech

The COVID-19 pandemic reshaped construction tech throughout 2020, but the net impact has been positive, according to JLL. Social distancing requirements and remote work forced a lot of construction firms to adopt technology faster than they might have otherwise. Meanwhile, the economic downturn this year led to tough market conditions, especially for lesser-known startup companies because construction firms were less profitable and did not have as much revenue to spend on unproven solutions.

The rapid shift to remote work for office-based employees also created new opportunities for the construction tech industry to grow. Fortunately, the design industry had already moved to cloud-based digital platforms years ago, meaning there was not much disruption during their projects’ early stages. Smaller local firms were less likely to have an existing cloud-based system in place pre-pandemic, however.

Construction tech also helped firms execute onsite during the pandemic in a couple of ways. First, opportunities to have less people on a job site were created. Solutions like scanning tools, virtual walkthroughs, virtual inspections, and digital issue tracking have been an adequate substitute for the traditional onsite meetings between subcontractors. Construction tech has also made it safe as possible for the people who must be onsite. In addition to the standard COVID-19 safety procedures like temperature checks and hand washing, solutions like wearables and monitoring devices have expanded in 2020.

“(These devices) ensure workers stay socially distanced and to allow contact tracing if any issues arise, and planning tools to enable optimal efficiency in staging and scheduling to ensure that teams stay separated,” D’Esposito said.

Construction tech’s success will rely on connectivity

JLL’s report lays out a variety of construction technology solutions to help projects keep moving forward, safely, during the pandemic. It’s key for CRE owners to remember many of these solutions will need reliable in-building wireless solutions to work effectively. If construction teams are bringing less people on site, it’s imperative that the tools they use to conduct virtual meetings, inspections and walkthroughs are working so they can finish their projects in a timely manner—causing less disruption for tenants.

Joe Dyton can be reached at joed@fifthgenmedia.com.

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