How AI and Big Data Can Future-Proof Buildings Against Climate Risk

As climate change accelerates, the built environment faces mounting physical risks that are reshaping the landscape of commercial real estate. The financial toll is rising rapidly—according to the Intact Centre on Climate Adaptation, “From 1983 to 2008, annual losses ranged from $400 million to $700 million, but since 2009, there has been a clear upward trend. Losses now average approximately $2.7 billion annually.” This staggering increase underscores the urgent need for action.

From rising sea levels to extreme weather events, our buildings are increasingly vulnerable, demanding an urgent and comprehensive response. To future-proof Canada’s real estate sector, we need to act now. This requires the prioritization of climate resilience, a shift in how we approach risk management, and a new understanding of the role that technology—particularly big data and artificial intelligence (AI)—can play in transforming the way we assess and mitigate these risks.

Where We Are: A Growing Crisis with Real Risks

Canada’s commercial real estate sector is at a tipping point. Climate risks are not evenly distributed across portfolios—while many assets face relatively manageable risks, a small subset of buildings, often referred to as the “long tail,” carries an outsized share of exposure. These high-risk assets, representing roughly 10% of portfolios, require urgent attention.

Yet, the industry’s response has been misaligned with the actual risk. The conversation around sustainability has largely focused on improving high-performing Class A buildings rather than addressing the buildings that are most vulnerable. As GRESB Chief Innovation Officer Chris Pyke recently noted:

“Resilience is about risk mitigation, and in some ways, we are talking about the wrong buildings. When we are talking about green buildings, we are talking about Class A+ green buildings… The risky buildings are at the other end of the tail.”

Historically, the approach to managing climate risks in buildings has been generalized, relying on one-size-fits-all checklists that are effective for sustainability goals but inadequate for climate resilience.

We have seen a slow adoption of robust climate resilience measures due to a significant data gap. Climate data and building-specific data need to be combined to pinpoint vulnerabilities and assess the potential impacts on each asset. Unfortunately, this massive data challenge has handcuffed decision-makers, leaving many in the dark or resorting to broad, unsustainable approaches such as insurers pulling out of high-risk markets or asset managers prioritizing resiliency planning on the “platinum” assets in their portfolio.

The situation is not improving at the pace needed, and the climate crisis is closing in. We must move beyond this inertia and adopt strategies that provide actionable intelligence to the building owners and operators who are at the heart of mitigating these risks.

The Opportunity: Technology as a Game Changer

For too long, assessing climate risk at the building level has been slow, costly, and reliant on fragmented data sources. Decision-makers have struggled to access the insights needed to take meaningful action. That is no longer the case.

Advancements in artificial intelligence, cloud computing, and big data analytics have revolutionized how we quantify climate risks and plan for resilience. Global climate models can now project extreme weather patterns at an unprecedented resolution, while building-specific data—covering everything from structural systems to maintenance records—provides granular insight into how climate hazards translate into financial risk.

Turning Data into Action

AI-powered analytics bring these vast datasets together, transforming them from raw numbers into actionable intelligence. Instead of relying on generic risk ratings or broad regional projections, property owners can now generate customized resilience strategies for each building. These systems can quickly identify vulnerabilities, estimate future capital costs, and recommend targeted investments to mitigate risks.

This shift has eliminated many of the traditional barriers to climate risk assessment. What was once an expensive, manual, and time-intensive process—often requiring on-site engineering evaluations—is now a scalable, data-driven solution. AI models can assess entire real estate portfolios in days rather than months, empowering owners and investors with the insights they need to safeguard their assets.

The tools exist today to future-proof commercial real estate against climate risks. The challenge is no longer about capability—it is about urgency and execution. The real question is: will we use these tools at the scale and speed required to protect Canada’s built environment?

What Canada Must Do Now

Canada has an opportunity to lead in this space by leveraging its existing strengths in innovation and sustainability. Key actions are required across multiple stakeholders to ensure the country becomes a global leader in climate-resilient real estate.

1. Government Action: Canada must introduce and enforce more rigorous climate resilience requirements in its national building codes. Voluntary programs like LEED, BREEAM, and BOMA BEST have recently integrated climate resilience best practices into their frameworks—offering a strong foundation. However, voluntary uptake is not enough. These programs should inform mandatory standards that ensure every new building is designed with physical climate risk in mind.
2. Industry Leadership: Developers, real estate owners, and operators must adopt portfolio-wide climate risk assessments. Programs like GRESB, which provide transparency and incentivize the integration of resilience into investment decisions, will be key to this shift. Companies need to identify and focus on the most vulnerable assets in their portfolios and prioritize resilience measures accordingly.
3. Investment in Technology: To harness the full potential of AI and big data, Canada’s real estate sector must embrace digital solutions that enable real-time, granular climate risk analysis. By investing in technologies that support these capabilities, stakeholders can make smarter, data-driven decisions about where to invest in resilience and which properties are worth protecting.
4. Collaboration with Insurers: Insurance companies will play a crucial role in managing risk, but need to adapt their models to account for climate change. While insurance premiums are rising, they do not always reflect the true risk to individual properties. A more nuanced approach, combining risk assessments with performance-based insurance products, can help create a system that encourages proactive investment in resilience.
5. Public Awareness and Action: Canadians need to understand that physical climate risks are real and that resilience is an urgent issue. Public-private collaborations, such as those in Boston and Florida, have shown that coordinated efforts to mitigate risk at a community level can lead to significant outcomes. Canada should foster similar collaborations across cities and provinces, helping to build a national network of climate-resilient buildings.

The Path Forward: Creating a Resilient Future

The future of Canada’s built environment depends on our ability to address the physical climate risks that threaten the safety, value, and operational continuity of buildings across the country. We must move beyond conventional methods and embrace new technologies that provide actionable intelligence to guide decision-making. With the right leadership, investment, and collaboration, Canada can become a global leader in climate-resilient real estate, protecting its infrastructure, economy, and people from the increasingly unpredictable impacts of climate change.