Proptech Funding 2025: Where $16.7B in Capital Is Going

Proptech venture funding surged to $16.7 billion in 2025, a 68% increase from the prior year, according to data from CREtech and PitchBook. After two years of pullback following the 2021–2022 peak, the sector has entered a new growth phase — but the composition of that growth tells a more nuanced story than the headline number suggests.

The capital is not flowing evenly. It's concentrating around AI.

The AI Divide

The most striking trend in 2025 proptech funding is the divergence between AI-native companies and traditional proptech platforms. AI-centered proptech companies attracted funding at roughly double the rate of non-AI peers, both in deal count and average round size.

This divide reflects a broader recognition that the next wave of proptech value creation will come not from digitizing existing workflows — that was the 2015–2020 story — but from automating them entirely. Investors are betting that AI-native platforms capable of executing complex real estate workflows will capture more value than tools that simply make human workflows slightly more efficient.

Where the Capital Is Concentrating

Construction technology led all categories with over $4 billion in funding, driven by large rounds for companies applying AI to project management, progress monitoring, cost estimation, and supply chain optimization. The construction industry's $1.3 trillion annual U.S. market size and notoriously low productivity make it a natural target for AI-driven efficiency gains.

CRE analytics and intelligence attracted approximately $3.2 billion, with investment shifting from pure data platforms toward tools that combine data with analytical capabilities — market forecasting, property valuation, and deal screening powered by machine learning.

Property management and operations saw $2.8 billion in funding, led by AI-powered platforms for maintenance management, energy optimization, tenant experience, and lease administration. The thesis: AI can meaningfully reduce operating costs across the 5+ billion square feet of U.S. commercial real estate.

Transaction and investment platforms captured $2.1 billion, increasingly focused on AI-powered underwriting, due diligence automation, and deal sourcing tools that compress transaction timelines.

Notable Trends

Vertical AI is winning. Horizontal AI platforms that serve multiple industries are losing ground to vertical-specific solutions built for CRE. The reason is straightforward: real estate workflows require domain-specific knowledge — zoning codes, ARGUS models, lease structures, construction specifications — that general-purpose AI tools handle poorly.

Agentic AI emerges. The most significant technological shift is the move from AI copilots (tools that assist human operators) to agentic AI (systems that execute multi-step workflows autonomously). Several companies raised significant rounds for agentic CRE platforms that can conduct site selection, due diligence, or underwriting with minimal human intervention.

Consolidation accelerates. Larger proptech companies are acquiring smaller, AI-native startups to add AI capabilities to their existing platforms. This trend is particularly visible in the data/analytics category, where established players are buying AI teams rather than building them.

What the Funding Signals

Venture capital is a leading indicator of where the industry is headed. The concentration of 2025 proptech funding around AI signals several things:

First, the market believes AI will fundamentally change how real estate is developed, managed, and transacted — not incrementally improve existing processes.

Second, the competitive moat in proptech is shifting from data access (which is increasingly commoditized) to workflow execution capability. The question is no longer who has the best data, but who can turn data into completed work product most efficiently.

Third, the winners will likely be platforms that combine AI capability with deep domain expertise. The most successful proptech companies are not pure technology plays — they're organizations that understand real estate workflows intimately and apply AI to automate them.

Build's Position

At Build, we sit at the intersection of these trends. We're an AI-native operating partner — not a software tool, but a service that deploys agentic AI alongside CRE domain experts to execute development workflows end-to-end. The $16.7 billion flowing into proptech validates what we've built: the future of CRE belongs to organizations that can combine AI capability with real estate expertise at scale.