"We will reshape our business from one dependent on on-site personnel into an artificial intelligence (AI)- and solution-driven model, evolving into a customized business-to-business (B2B) platform."
Since taking office in January, HDC Labs CEO Lee Jun-hyung has repeatedly emphasized business restructuring and transformation both inside and outside the company. His assessment is that a business structure centered on facilities management and construction cannot escape the structural limits of low margins. Instead of a model where revenue is generated by directly deploying manpower, he has declared a strategy to transition into a space operation platform company that combines artificial intelligence of things (AIoT) with data and solutions to sell value to customers. This vision quickly translated into results. HDC Labs' first-quarter net profit reached 6.77 billion won ($4.9 million), up 158.3% from a year earlier. The results of the structural shift were proven in numbers just three months after his inauguration.
Meeting with Seoul Economic Daily at HDC Labs' headquarters in Seocho-gu, Seoul, on the 29th, Lee said, "When solutions replace what people used to do, added value rises and margin rates follow." He added with confidence, "We are at the beginning of change, but small successes will create momentum."
HDC Labs consists of three business units: home network, construction, and real estate building management. Its core businesses include the home network business, which supplies wall pads and door locks to "IPARK" apartments; specialty construction covering mechanical, electrical, and firefighting works; and real estate building management encompassing facilities operation, security, and cleaning. Added to this is the AI Technology Research Institute, launched three years ago, which is now accelerating the commercialization of solutions.
Lee defines HDC Labs as "a company that raises the value of space." Its business scope covers every space where people live and work — residences, offices, factories, and resorts. Soon after his inauguration, he added an important precondition to this definition: without the integration of technology and data, "the value of space" remains an empty slogan. "Every business ultimately exists within a space," Lee said. "If we have run those spaces solely on human labor until now, solutions are the answer going forward."
From security guards in building lobbies to operations staff in underground utility rooms and cleaning workers going from floor to floor, most revenue comes from people. In a competitive bidding structure, price wars are inevitable, and margins shrink. The same holds true for construction. Given the nature of specialty construction that deploys on-site labor, the cost structure is not robust. Lee was aware of these structural limits even before taking office, having previously overseen similar business groups at the LG Group holding company.
HDC Labs has about 6,000 employees. Of these, roughly 450 are in general technology, administrative, and research positions, while the rest work in the field. What is unusual is that they are all HDC Labs employees, not subcontracted workers. This contrasts with other conglomerate-affiliated facilities management firms that indirectly oversee around 10 partner companies. Lee views this as a double-edged sword. On-site execution capability and loyalty are clear strengths, but the risks of directly managing thousands of people are also significant. "Companies with strong on-site capabilities can execute well, but if management falters, it becomes a risk," he said. Lee is focused on digitizing these capabilities and converting them into differentiated competitiveness that rivals cannot easily replicate.
His specific breakthrough is an AI-based closed-circuit television (CCTV) monitoring solution. The system detects fire, smoke, and worker anomalies at factories and construction sites in real time and sends immediate alerts. If a worker collapses or a dangerous situation arises during hot work, a remote control center automatically captures it with AI. Previously, people had to watch monitors 24 hours a day, but with AI taking over, monitoring staff is reduced and response time is faster. It is a real-world example of structural transformation in which solutions replace human services and raise added value.
In the physical AI domain, the company is also expanding its robotics business. Through collaboration with Zeroworks, a logistics robot company acquired by HDC Group, robots are being deployed at construction sites and for building security. Tasks too dangerous for people, such as exterior wall cleaning or hot work at heights, are handled by robots. The same applies to nighttime security patrols. In office buildings and factories, robots carry out 24-hour patrols that humans used to conduct at night, immediately reporting abnormalities.
AI services in residential spaces are also being upgraded at pace. A voice-based AI wall pad will be installed this July at Lotte Upper House, a high-end residence in Seocho-gu. Within a 5-meter radius of the wall pad, saying "open the main entrance," "how's the parking," or "how's the weather" triggers immediate execution. The entire home environment can be controlled by voice alone, without pressing buttons. "If existing wall pads stayed as simple display devices, the AI wall pad is an attempt to change the very interface of residential space," Lee said.
At "Seoul One IPARK" in Wolgye-dong, Nowon-gu, Seoul — a flagship development of HDC Group — the company plans to introduce even more advanced behavior-based AI services. AI learns residents' behavior patterns and proactively suggests services without voice commands. If a resident has the habit of drinking water after coming home from work, the system announces, "I'm getting ready to pour water," and when the TV is turned on, it first asks about the favorite channel. The more lifestyle data accumulates, the more accurate the services become. "Just as humanoids change entire process flows at factories, similar things will happen in residential environments," Lee said.
The door lock business is also evolving. The new door lock developed by HDC Labs and sold through consignment manufacturing locks immediately once the door closes, eliminating the one- to two-second gap in existing products. It is aimed at the safety of single-person households, especially female residents. Both wall pads and door locks are developed by HDC Labs itself and sold externally, expanding the business into an independent product line that goes beyond mere supply to affiliates.
The testbed for validating its own solutions is its headquarters, "HDC Labs Tower." In the elevators, an AI boarding volume detection system is being tested in collaboration with Hyundai Elevator. By measuring volume rather than the number of people, the system improves operational efficiency by skipping certain floors when a particular floor has a large crowd. Facial recognition is applied to the access system, allowing pre-registered visitors to pass through without a security guard. Door lock and AI technology validation tests are also running in parallel at IPARK Mall in Yongsan. "The testbed is not just Labs Tower," Lee said. "All captive spaces owned by the group are validation sites." Once validation is complete and effectiveness is confirmed, the solutions are sold to external customers.
On the data side, R114, a real estate information business acquired through a business transfer last year, is emerging as a new growth axis. Leveraging the 300,000 monthly visitors on R114, the strategy is to link HDC Labs' solutions business and build new revenue models through on-platform exposure and advertising. For construction orders, real estate market data is used for site evaluation and sales strategy. In the medium to long term, the plan is to combine operational data and market data to develop a sophisticated proptech-based space operation platform. A role leading product planning, customer analysis, and operational strategy enhancement in collaboration with HDC Asset Management or IPARK HDC is also under consideration.
HDC Labs' role has also been clarified in the future vision and strategy of HDC Group, which marks its 50th anniversary this year. At a vision declaration ceremony in March, the group presented life, AI, and energy as three growth pillars. Among these, HDC Labs is the core execution body for the AI axis. In a structure where HDC HDC develops real estate and energy affiliates handle infrastructure, HDC Labs is loaded on top of that foundation.
