Proptech Venture Capital Investment in 2024 Up Sharply Over 2023
Funding increased 32.5% annually to $15.1 billion
By Philip Russo December 16, 2024 8:59 am
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Proptech venture capital funding came in like a lamb in 2024, but is exiting like a lion as it closes out the year, according to a report released Monday.
The Center for Real Estate Technology and Innovation’s Annual Venture Capital Report found that VC investment in proptech reached $15.1 billion in 2024, a 32.5 percent year-over-year increase from 2023.
The funding leap reflects growing investor confidence in the sector’s ability to address critical challenges across real estate verticals and tech categories, signaling a paradigm shift from experimentation to adoption, the CRETI report said.
Significant investments in the construction, multifamily and residential sectors fueled the VC investment growth. Construction tech, or contech, led with $4.5 billion as developers embraced tools for efficiency, sustainability and safety. Meanwhile, residential garnered $3.6 billion in funding, while multifamily gained $2.95 billion — both fundings representing a focus on enhancing tenant experiences and operational scalability, according to the report. The office sector saw $2.25 billion in funding.
VC funding changed notably in 2024, particularly at the seed and Series A stages, according to CRETI’s report. Valuation expectations were recalibrated to pre-ZIRP (Zero Interest Rate Policy) norms, creating a more disciplined investment landscape, while Series A rounds became larger, with consistent ownership targets raising revenue scale requirements for startups to between $2 million and $3 million.
“The surge in proptech investment in 2024 reflects the industry’s readiness to embrace innovation at an unprecedented scale,” Ashkán Zandieh, managing director at Dallas-based CRETI, said in a statement. “Technologies like artificial intelligence, automation and alternative finance are no longer peripheral; they’re central to solving real estate’s most pressing challenges.
“This marks a shift from niche experimentation to sector-wide adoption. As we move into 2025, this growth will likely expand beyond investments into partnerships and collaborations, further integrating technology into the fabric of the real estate industry.”
The report also noted that several transformative themes defined 2024, including artificial intelligence and automation. Both have emerged as dominant forces as companies leverage machine learning to predict maintenance needs, optimize workflow, and improve decision-making. Sustainability also attracted significant attention, as investors backed innovations in green building practices and energy efficiency to meet environmental and regulatory demands.
“Proptech in 2024 has been about creating impact — social, environmental and financial,” said Zandieh. “As we move into 2025, this growth will likely expand beyond investments into partnerships and collaborations, further integrating technology into the fabric of the real estate industry.”
Ajey Kaushal, a principal at San Francisco-based JLL Spark, said in the report: “Proptech is no longer just about the future, it’s about the now. Investors and operators are seeing clear value in leveraging technology to drive efficiency, sustainability and improved tenant experiences.”
In the construction sector, Travis Connors, co-founder and general partner at Building Ventures, a Boston-based VC firm, offered: “The momentum we’ve seen this year confirms what we’ve believed for some time — real estate technology is not a passing trend. It’s becoming essential to the industry’s evolution and resilience.”
According to the CRETI VC report, the higher investment in proptech venture capital this year reflects a new era of technological integration in real estate. With advancements in innovation-oriented categories and increased cross-sector adoption, the industry is poised for continued transformation in 2025 and beyond, the report asserted.
Philip Russo can be reached at prusso@commercialobserver.com.
Correction: This article originally stated that 2024’s funding total was an annual record. Other years surpassed it.
