2026 Proptech Predictions: Anyone Up for AI?

Predicting can be a risky business, but it can be fun too. (If no one is keeping score!)

With that in mind, a number of proptech entrepreneurs have chosen to manifest their inner Oz Pearlman and look into what technology innovations might lie ahead for real estate in 2026.

The construction industry was perhaps the sector that produced the most predictions for adoption and tech iterations in the coming year.

“Over the next few years, AI will start to truly understand the physical world,” wrote Jeevan Kalanithi, CEO and co-founder at OpenSpace, a provider of visual and spatial intelligence for construction. “Large language models have dominated the news cycle for the last few years, and for good reason. They are amazing. But the next major leap will come from spatial AI — AI systems trained on reality data like images, video and spatial information that capture how the physical world actually looks and functions.”

Much of the focus of the field of spatial AI has been on building world models for robotics, but Kalanithi said the applications can be even broader, changing how real-world industries function. He pointed to computers that can interpret job site, factory or infrastructure projects with a human-like grasp of context. That includes answering questions based on spatial context and location, spotting missing materials, or identifying other issues automatically, while delivering real-time visual intelligence that when paired with human insight can help builders and operators work more efficiently and safely.

Not quite as close to everyday use are robots.

“We’re still a long way from humanoid robots that can safely and autonomously roam the unpredictable, high-variance environment of a construction site,” Kalanithi cautioned. “The real progress in 2026 will come from narrow robotics systems built to perform one physical task exceptionally well, such as drawing layouts or moving materials with precision. The future isn’t robots instead of people, it’s robots supporting people. The companies that win will be the ones that pair specialized machines with the experience and intuition of the humans who make construction happen.”

OpenSpace Chief Technology Officer and co-founder Michael Fleischman sees smart glasses becoming the new smartphones for builders.

“By 2026, smart glasses will start to move from novelty to an early-adoption inflection point,” Fleischman said in an email. “Within the next few years, construction workers will wear smart glasses the way we use smartphones today: continuously, intuitively, and as an essential part of the job. These devices will provide real-time spatial data and AI insights directly into a worker’s view, giving them just-in-time information tailored specifically to who they are and where they are. As generative and spatial AI converge, this will mark the beginning of a new on-site interface: the digital and physical worlds finally merging in everyday field operations.”

The future of unmanned construction projects and corporate venture initiatives in the heavy equipment world led Henri Lee, co-founder and CEO at Xpanner, a provider of construction automation solutions, to write his comment about “physical AI.” He described it as a blend of robotics, sensing and control designed to tailor automation to specific workflows and projects, enabling AI-powered unmanned job sites with human oversight.

“Physical AI is transforming construction by integrating perception, intelligence and actuation with a system-level approach to automate job-site tasks, thus addressing labor shortages and meeting AI-driven infrastructure demands,” said Lee.

To succeed in this latest AI iteration, the construction industry will need to collect previously ignored data, such as machine motion trajectories, task sequencing, weather interactions and real-time safety measures to train effective AI models, he explained.

“By 2026, the construction industry will witness the foundational deployment of physical AI, transitioning from pilot projects to real-world usage, with the emergence of unmanned job-site zones and reliable operation in unpredictable environments, marking a shift toward functional implementation.”

AI in general will be viewed through a different lens in 2026, Prasan Kale, co-founder and CEO of CRE AI workflow automation platform Outcome, said in an email.

“The CRE industry is done with AI experiments,” wrote Kale. “What I’m hearing from leading firms and industry insiders is clear: 2026 will be the year of practical AI that works today, not pilots that take months to deploy.

“The hot trend will be efficiency. With rising labor costs and leaner teams, firms are prioritizing tools that help them do more with less, without complex implementations. The winners will be AI-native platforms built specifically for CRE workflows, not generic enterprise software retrofitted for real estate. Buyers have grown skeptical of broad AI promises and are now demanding solutions that deliver measurable value on day one.”

The multifamily sector will experience “a reckoning year,” wrote Virginia Love, a 30-year industry veteran and industry principal at Entrata, an operating system for the rental industry.

“Income growth has finally surpassed rent growth, giving renters new leverage and putting pressure on operators to demonstrate value and transparency,” said Love. “Meanwhile, Gen Z renters have burst onto the scene as the most informed, selective and transient cohort in history, demanding value and transparency in every interaction.”

Given that emerging cohort, Love predicted that 2026 will redefine what “value” means in renting for residents and property managers, including “the return of worth. Renters will pay for what feels worth it, not just what’s cheapest. Operators who can tell that story clearly will win.

“Tech will move behind the curtain,” she added. “Tech and automation will finally streamline, not strain, on-site teams through smarter integration and training, while also elevating the renter experience with faster responses, proactive service and more personalized living.”

Another view of AI in the rental market came from Julie Blanc, co-founder and CEO at Rentana, an AI-powered revenue intelligence platform designed to optimize pricing for multifamily owners and operators.

“In 2026, real estate leaders will embrace AI as a business intelligence tool that identifies revenue opportunities at scale,” Blanc said in an email. “While 2025 saw advances in the use of AI for lead management and content creation, 2026 will be the year that operators and ownership groups recognize AI’s criticality to high-level decision-making.

“AI can empower these stakeholders with unprecedented access to the data that has always been at their fingertips yet just out of reach,” she added. “Optimizing net operating income in 2026 will be tough without this kind of assistance. The industry will be compelled to shift their focus to automated workflows and AI-powered data analysis to better inform their revenue strategies.”

Jenna Tuttle, vice president of product at Zego, a property management software company, predicted that AI-driven automation will be a key technology in 2026 as property managers aim to reduce their workloads and increase their efficiency.

“Everyone wants artificial intelligence as part of their solution, whether or not they know what that means, but they know they need it,” said Tuttle. “Being able to deliver technology to them that helps to streamline their operations and helps to make their teams more efficient is really what they’re looking for. They categorize that as AI, whether you’re really using the technology that goes along with that or not.”

Eric Walsh, executive vice president and executive managing director for North America at technology giant MRI Software, picked up on predicting the tenant side of the business.

“Intuitive and fully integrated tenant experience leasing platforms will become the industry standard,” Walsh wrote in an email. “The demand is clear: According to a 2025 Zipdo report, 65 percent of residents prefer digital leasing methods over paperwork, 64 percent of landlords already use or plan to adopt virtual leasing offices, and 78 percent of property managers say digital transformation improves operational efficiency.”

In defining what’s automation compared to what’s AI, Walsh felt that automation gives efficiency, while AI provides intelligence.

“When you combine them, you enable staff to focus on higher-value decisions and customer outcomes,” he said. “Unified tech platforms support the combinations of AI and automation.  Closed platforms and siloed data are as obsolete as dial-up ISPs.”

The residential brokerage sector will use technology even more extensively than in recent years, said Brandon Wright, CEO and co-founder of Tongo, a firm that builds financial products for the commission economy.

“What we’re seeing on the residential side, where we spend most of our time, is that brokerages not reaping the benefits of huge windfalls of sales are getting way more efficient,” said Wright. “We think that brokerages will continue to consolidate, largely for cost efficiency, and they’ll take an opportunity to retrench and invest in their tech stacks. The trend we saw in 2025 that we think will continue to 2026 is that now with sales down from 2022-2023, we’re seeing brokerages understanding the need to compete for agents with better technology.”

Proptech opportunities lie in streamlining the transaction process post-contract, particularly in title and escrow, he said. Additionally, early-stage companies will continue to receive funding, while later-stage companies will seek substantial rounds from private markets due to the current unattractiveness of public markets. Family offices and established venture firms like Fifth Wall and MetaProp will play significant roles in funding.

Commercial, industrial and retail property owners looking to integrate their physical and digital real estate asset management face a host of challenges for technology to address, said Austin Rabine, CEO at Site Technologies, a Chicago-based property assessment and maintenance platform that uses drones, AI, and advanced analytics to help owners manage their portfolios more efficiently.

“Labor shortages will continue to spike, and using AI-enabled tech will support teams thin on the ground to still access accurate, up-to-date condition data,” said Rabine in an email, calling maintenance “mission‑critical” for property owners.

“The unknown will become known and actionable,” Rabine said. “Routine inspections and comprehensive condition data for roofs, pavements, facades and critical assets reveal risks like never before.”

While the return-to-office trend continues apace, the sector needs tech intervention more than ever, Cove co-founder and CEO Adam Segal said in a statement.

“The U.S. office market remains structurally challenged, with vacancy rates near record highs,” Segal wrote. “While markets like New York City and San Francisco lead the recovery, others lag behind. Remote and hybrid work have permanently altered demand patterns, breaking the old link between economic growth and office absorption.

“Yet, amid this turbulence, optimism surrounding the new hybrid work model persists. J.P. Morgan’s $4 billion headquarters at 270 Park Avenue in Manhattan exemplifies the new playbook — offices must become destinations that deliver amenity-rich, hospitality-driven experiences designed for hybrid work realities,” Segal added. “Today’s tenants now expect frictionless technology, wellness features and curated services that make coming to the office feel purposeful and productive. In 2026, technology will be the great equalizer, enabling even mid-tier Class B assets to compete by delivering customized, high-value experiences that foster tenant loyalty and drive occupancy.”

Relatedly, flexible workspace could provide more business for proptech, James Lowery, CEO at London-based Essensys, a software and tech provider for flexspace, said in an email.

“Addressing the emerging generational divide in tenant expectations is the next big opportunity for office spaces,” said Lowery. “Digital experience will drive revenue beyond space — from meeting room management to energy efficiency, digital platforms that will transform workspace management into a service-led, revenue-generating ecosystem.

“Offices won’t just provide desks, they’ll deliver continuous data insights to optimize space, usage, and operational efficiency, while spaces that foster collaboration, wellness and creativity will outperform those that don’t.”

Andrés Leal, CEO and founder at Bogotá, Colombia-based Triarii Group, a proptech network that links Latin America and U.S. real estate and digital companies, wrote in on the asset class du jour and what it needs: “Energy is what’s hot. Power has become real estate’s ultimate gatekeeper. AI-driven data centers will consume 8 to 12 percent of global electricity by 2030. The new game is who controls the electrons.”

Leal also pointed to retail as a sector ripe for tech disruption in 2026.

“The $600 billion live video shopping revolution is changing retail,” he said. “Some 82 percent of consumers report enjoying interacting with live hosts during shopping events, adding a personal touch to the experience. China accounts for more than 78 percent of the global live shopping market, with explosive growth in recent years.

“And retail-as-a-service is a new model that’s disrupting the retail shopping mall industry. A modern service-based, performance-driven contract model, it allows retailers to subscribe to a range of operational service packs through a monthly subscription fee.”

Philip Russo can be reached at prusso@commercialobserver.com.