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Global real estate fundraising in 2024 fell to a decade-low of $85.8 billion, driven by liquidity constraints and macroeconomic uncertainty. However, the market saw recalibration, not collapse. Capital concentrated around experienced managers and high-conviction strategies, with a pivot toward opportunistic and debt funds. Core strategies waned while niche sectors like affordable housing and data centers gained traction. Meanwhile, ESG considerations became critical for capital access. Despite weak returns, green shoots emerged late in the year. Ultimately, the sector is transitioning toward precision-led investing, emphasizing experience, resilience, and alignment with long-term structural trends.

In 2024, climate tech startups faced a more challenging fundraising environment. Note that VC investments dropped 7.2% to $12.9 billion. In other words, investor caution led to a shift toward late-stage deals, favoring companies with proven traction and clearer paths to profitability. Besides, policy uncertainty and the AI boom diverted capital and attention, especially as AI promised faster returns. Consequently, early-stage, hardware-intensive startups struggled most. Macroeconomic pressures further strained funding. These factors pushed founders to seek non-dilutive capital and reframe narratives. Despite short-term challenges, this reset is expected to enhance sector discipline. It will surely lay the groundwork for more sustainable, scalable climate innovation in the future.