Valley Bank's third annual report on proptech, which included collaboration from alternative investments firm GreenPoint and real estate tech-focused VC firm Metaprop, reports that there are some significant headwinds for proptech firms.

Obvious ones are tied to the difficulties that much of the CRE industry faces, including coming debt maturities, high interest rates, and the cost of construction. There's also the uncertainty of rising taxes, utilities, and insurance. Companies worried about operating costs are less likely to pony up for more tech.

"Last year, the pace of dealmaking in proptech finally succumbed to the general slowdown that has been observed in virtually every other asset class," they wrote. "Moreover, for proptech, 2023 saw the lowest count of completed transactions since 2017, albeit for a combined aggregate value of $2.9 billion that exceeded 2020's total." Venture capital deals tallied 144 for an aggregate of $2.7 billion. The bulk of the activity was in the final quarter.