Contrary to the common misconception that AI will take over large segments of work and create entirely new business models, its most profound impact is less glamorous but crucial, achieved through multiple small-scale cumulative improvements at different strategic points. Through detailed expert reviews, JLL found that current AI capabilities, such as image recognition, data modeling and text generation, could enhance the effectiveness of an estimated 65% of all tasks in the sustainable asset enhancement process by increasing accuracy and speed, streamlining processes and allowing for better data management and retention.

Among these, four key strategic points stand out where AI-powered technologies could add the most value.

Recent findings from JLL’s Asset Enhancement Initiatives Survey reveal that understanding the payback period and securing project funding are the largest barriers to undertaking asset enhancement projects. Retrofits, particularly medium to deep retrofits, are so capital-intensive that building owners and investors tend to act with the highest discretion.

However, most owners and investors lack a systematic approach to these projects. Large sums of capital are often committed based on individual building audit reports, without proper portfolio-level oversight. But building audits are not designed to analyze hundreds of properties simultaneously. Companies and experts need effective tools to align priorities - including target tenant preferences, sustainability goals, equipment replacement cycles, upcoming lease expiries, regulatory changes and investment requirements - to help develop a data-driven, costed, time-sequenced and actionable roadmap.

AI and tech solutions offer significant potential to address this strategic planning challenge:

Example AI-powered technology functions available:

AI-assisted audits offer direct benefits by reducing auditing time and increasing accuracy and data quality. AI-powered energy modeling enhances the ability to identify untapped energy saving opportunities and deliver monetary benefits in building operations. These AI-driven efficiency improvements can contribute to more buildings being audited and the creation and integration of more digital twins, a crucial factor in accelerating retrofits to align with net-zero targets. At the light retrofit end of the spectrum, AI-driven energy optimization products (like JLL’s Hank) can already offer cost-effective solutions with wide-ranging benefits and significant cost-savings.

Traditionally, retrofits have been viewed as one-off, costly efforts with minimal knowledge accumulation. Without proper data retention and communication throughout the retrofit life cycle, decision-making continuously suffers from a lack of quality data, leading to ineffective planning and limited improvements over time.

Additionally, asset performance improvement projects typically involve various stakeholders from multiple specialist organizations. Centralizing and standardizing information exchanges has been challenging, resulting in isolated data and missed opportunities to gain collective insights.

By implementing AI, particularly the latest GenAI and LLM capabilities, information flow can be significantly streamlined, and best practices can be identified and replicated at scale. Updating retrofit results into a centralized database enhances future benchmarking and replaces rough assumptions with precise, data-driven insights, allowing experts to focus on adding value rather than on data collection and management. Accumulating high-quality data and insights establishes a valuable resource for broader applications in construction and decarbonization efforts.

Example AI-powered technology functions available:

More organized and structured data can yield coherent insights into retrofit processes, allowing owners and investors to continuously track ROI and develop a clearer understanding of payback periods. Enhanced communication between siloed stakeholder groups promotes effective information sharing, which is critical for project delivery and sustained post-completion performance. Most importantly, increased data availability will enhance the effectiveness of all previously discussed AI and technology use cases, bringing long-term cumulative benefits.

Considering available approaches to leverage AI, there are actions for building owners and investors to take now to kickstart AI integration: 

• Understand your priorities (i.e., cost saving, time saving, meeting regulation, etc.) and define objectives for using AI to identify tools for maximum benefits.
• Assess the AI readiness of your organization. Identify gaps in data quality and availability. Move to digitize existing building information, lease time frames and other critical data on the portfolio level to enable decarbonization at scale.
• Conduct a detailed provider landscape scoping and evaluate the optimum approach to harvest AI capabilities: buy, build or partner.

AI will not directly solve all the challenges in sustainable asset enhancement and decarbonization, but by strategically integrating AI within project planning, management and implementation, building owners and investors can take a more informed approach to make a stronger business case for these enhancement initiatives, which is the premise of realizing net-zero and long-term return on investment.

Explore more of JLL's latest insights on World Economic Forum themes at our dedicated Davos page.