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Real Estate & Construction News Roundup (11/5/25) – Apartment Conversion Projects Surge, Targeted AI in Real Estate Increases and Hotel Lobby Urge End of Government Shutdown

December 02, 2025 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
In our latest roundup, government shutdown affects contractors, hotel construction stays flat, and more!

• The total U.S. hotel construction pipeline stayed relatively flat year over year in the third quarter of 2025, while brand conversions saw record-high project totals. (Lara Ewen, Construction Dive)
• Construction attorneys say some federal jobs during the government shutdown may require contractors to keep working, even if they’re not getting paid. (Sebastian Obando, Construction Dive)
• The government shutdown has resulted in an estimated $650 million in lost hotel business, with each day of the shutdown costing the economy $31 million “in activity that would’ve been generated by hotel stays.” (Lara Ewen, Hotel Dive)

Read the full story...
Reprinted courtesy of Pillsbury's Real Estate & Construction Law Team

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Risks of Using an AI Chatbot for Legal Advice: Lessons from United States v. Heppner

April 08, 2026 — Payne & Fears LLP
Imagine that you are an executive (who is not a lawyer) and are concerned about what your company plans to do is legal. You could call your lawyer who might bill you for the call. Or, you can ask your AI chatbot, such as Claude or ChatGPT, about the legal risk. The chatbot will likely compliment you on the incisive question, provide you with highly confident answer (that may or may not be right) and will not bill you on an hourly basis. That is essentially what financial services executive Bradley Heppner did. It did not end well. A federal court recently ruled that Heppner’s chats with the AI tool Claude were not protected by attorney-client privilege or the work-product doctrine. That means that the other side (in this case, the federal government) could get access to his chatbot prompts, uploads and responses, and learn a great deal about, for example, whether Heppner knew what he was doing was illegal. Read the full story...
Reprinted courtesy of Payne & Fears LLP

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Modular Construction’s Big Boom: New Risks Outpacing Standard Contracts in Industrial Projects

March 24, 2026 — Chad Theriot & Jack Mayo - Construction Executive
Modular construction is revolutionizing the construction industry, tackling labor shortages, sustainability goals and supply-chain challenges, with the global market for modular and prefabricated construction projected to reach over $200 billion by 2030. While residential builders have embraced modular’s speed and affordability, the greatest risks—and opportunities—are emerging in the industrial sector, where project scale and complexity demand new legal strategies. In 2023, Chad Theriot explored industrial and infrastructure applications of modular construction, addressing risks like offsite fabrication and integration complexities in his article, “The Rise of Modular Construction—Impacts for Consideration.” Since that time, modular construction has continued to experience significant advancements and has been increasingly adopted by contractors across a broad spectrum of industrial and commercial projects. As modular construction continues to reshape the industrial landscape, contractors and owners alike must be mindful of the legal implications associated with its use, specifically as it relates to liability and risk allocation, regulatory compliance, quality control and upstream factors such as transportation and intellectual property concerns. Reprinted courtesy of Chad Theriot and Jack Mayo, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the full story...

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Surety Liability Is Coextensive with Its Bond Principal

April 14, 2026 — David Adelstein - Florida Construction Legal Updates
A recent Miller act payment bond case, U.S. f/u/b/o Whitetail General Constructors v. Northcon, Inc., 2026 WL 46671 (D.Mont. 2026), contains a short noteworthy discussion as to a surety’s liability being coextensive with that of its bond principal. If you are bonded, or you are pursuing a bond, you need to appreciate this, which is why this is a noteworthy discussion:

A “surety’s liability on a Miller Act bond must be at least coextensive with the obligations imposed by the Act if the bond is to have its intended effect.” “Therefore, ‘the liability of a surety and its principal on a Miller Act payment bond is coextensive with the contractual liability of the principal only to the extent that it is consistent with the rights and obligations created under the Miller Act.’” In other words, “[w]here a subcontract’s terms are consistent with the Miller Act’s provisions, the surety’s liability on the Miller Act bond is coextensive with the contractual liability of its princip[al].”

“The liability of a surety under the Miller Act is controlled by federal law, rather than state contract law[.]” The court may, however, “look to state law when interpreting contractual provisions” in a Miller Act case.

“[T]he measure of recovery under the Miller Act is generally determined by the terms of the subcontract [or underlying contract].”

Northcon, supra, at *4-5 (internal citations omitted).

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Reprinted courtesy of David Adelstein, Kirwin Norris
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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High-Rise Design and Construction: Then, Now, and Next

March 16, 2026 — Aarni Heiskanen - AEC Business
The Empire State Building was built in 14 months. Since 2010, the average completion time for a 200-meter-plus building has increased from 4.3 to 5.8 years. Buildings have become more complex, and there's more regulation than in the 1930s. Still, there are ways to make high-rise construction more efficient. An Unlikely Benchmark From 1930 When construction began on the Empire State Building on March 17, 1930, the world was in the midst of the Great Depression. That turned out to be an advantage. Contractors Starrett Brothers & Eken had access to a vast, motivated workforce, peaking at 3,439 workers on a single day in August 1930. Read the full story...
Reprinted courtesy of Aarni Heiskanen, AEC Business
Mr. Heiskanen may be contacted at aec-business@aepartners.fi

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2026 Construction Outlook: Dampening Outlook With Some Potential Bright Spots

February 17, 2026 — Garret Murai - California Construction Law Blog
According to Dodge Construction Network’s Outlook 2026 Ebook, “the construction industry came roaring into 2025” – with large government investments through the Infrastructure Bill and the CHIPS Act (promoting investment in the domestic semiconductor industry), as well as outsized spending on data centers to support cloud and AI technology – but “throttled back significantly” due to “rapid changes to economic and fiscal policies.” These changes include short-term cost impacts due to tariffs and labor impacts due to the federal government’s immigration crackdown and long-term concerns following enactment of the One Big Beautiful Bill (OBBBA) which is anticipated to add $3.4 trillion to the federal deficit over ten years. Read the full story...
Reprinted courtesy of Garret Murai, Nomos
Mr. Murai may be contacted at gmurai@nomosllp.com

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Court Rules Cook County Misspent $243M in Transportation Funds

March 10, 2026 — Annemarie Mannion - Engineering News-Record
A Cook County Illinois Circuit Court judge has ruled that the county violated the state constitution by using $243 million in transportation tax revenue during fiscal 2023 for non-transportation purposes, handing a legal win to a statewide coalition of construction trade groups. Read the full story...
Reprinted courtesy of Annemarie Mannion, Engineering News-Record
Ms. Mannion may be contacted at manniona@enr.com

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Are Robotic Coworkers Soon a Reality in Construction?

March 24, 2026 — Aarni Heiskanen - AEC Business
General-purpose humanoid robots are in the headlines, but is the hype justified? What’s the point of having a robot home assistant when it still needs a “guy behind the curtain” to control it remotely? Despite the challenges, robots, even those that look like humans, are seriously considered as future coworkers in business environments. According to the McKinsey report ‘Will embodied AI create robotic coworkers?‘ the idea that AI-powered robots will become general-purpose coworkers is grounded in real technological progress, but not an overnight reality. Read the full story...
Reprinted courtesy of Aarni Heiskanen, AEC Business
Mr. Heiskanen may be contacted at aec-business@aepartners.fi

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