AI data centers emerge as new growth engine for construction industry as government, sector launch forum

The government and the mechanical construction industry have launched a public-private consultative body to develop AI data centers as a new growth engine for the construction sector. Amid surging demand for data centers driven by the spread of AI and cloud services, the forum aims to bring together construction, mechanical systems, power and ICT companies to strengthen the domestic market and build a foundation for overseas contracts.

The Korea Institute of Mechanical and Electrical Constructors said it held a launch ceremony Wednesday afternoon for the "Forum on Revitalizing the Data Center Construction Industry in the AI Era" with the Ministry of Land, Infrastructure and Transport at the Korea Mechanical Construction Contractors Association building in Gangnam-gu, Seoul.

The Ministry of Land, Infrastructure and Transport chairs the forum, with the Korea Institute of Mechanical and Electrical Constructors — an affiliate of the Korea Mechanical Construction Contractors Association — serving as its secretariat. The forum is organized into four subcommittees covering manufacturing and construction, operations and maintenance, regulation and standardization, and overseas expansion and financial support.

Kim Seok-gi, director general of the Ministry of Land, Infrastructure and Transport's construction policy bureau, serves as government co-chair, while Kim Chae-gyu, a research fellow at the Korea Institute of Mechanical and Electrical Constructors, serves as private-sector co-chair. More than 120 experts from 65 institutions across government, academia, industry, research organizations and trade associations are participating.

Participating institutions include major construction and engineering firms alongside equipment and electronics companies such as Samsung Electronics, LG Electronics and Samsung SDI, energy and power companies including Korea Electric Power, SK Innovation and LS Electric, and ICT firms such as NHN Cloud and KT Corp. The lineup reflects how data center construction has evolved beyond building structures into an industry that integrates power supply, cooling systems, battery technology, and operations and maintenance capabilities.

The forum's launch also aligns with the construction industry's search for new contracts amid a prolonged slump. According to the Korea Construction Industry Institute, construction output in March stood at 12.3 trillion won ($8.03 billion), down 2.5 percent from the same month a year earlier. A continued slowdown in private-sector building activity has kept the overall recovery limited.

Government policy to expand AI infrastructure is also driving demand for data center construction. The government has allocated 10.1 trillion won for AI-related spending this year, pursuing high-performance GPU procurement and AI infrastructure development. The National AI Strategy Committee is also working out detailed regulatory frameworks ahead of the scheduled March 2027 enforcement of the Special Act on Promoting the Artificial Intelligence Data Center Industry. Those frameworks include streamlined permitting, designation of AI data center special zones outside the Greater Seoul area, and exemptions from power grid impact assessments.

"Data centers are critical infrastructure that will determine national competitiveness in the AI era, and a new growth engine for a construction industry in crisis," Kim Seok-gi said. "We will work closely with related ministries to actively build the legal, regulatory and financial foundations needed to foster the industry ecosystem and support overseas expansion."

Kim Chae-gyu said the forum would "faithfully carry out its role as a public-private policy design body to help the government realize its vision of making Korea one of the world's top three AI data powerhouses."