New York developer RXR Realty has abandoned hope of taking a proptech company public through a merger with a special-purpose acquisition company.

RXR, founded and led by Scott Rechler, disclosed its plans to fold RXR Acquisition Corp. and return $345M to investors in a Securities and Exchange Commission filing Tuesday, The Real Deal reports.

The company had “several opportunities to acquire various startups with strong business models and momentum,” but thought the valuations of those startups were too high, an RXR spokesperson told TRD in an email.

A redemption amount of $10 per share will be returned to the investors. RXR announced plans for its SPAC in February 2021, initially trying to raise $250M, a target that was then increased to $345M.

Private investment into the proptech sector hit $32B in 2021, according to the Center for Real Estate Technology & Innovation. That record total represented a 28% increase from 2020 and a 3.2% bump from 2019.

But a year later, the fundraising environment completely changed, with proptech firms contending with slashed share prices and layoffs. Companies like WeWork, smart lock company Latch and online real estate investor Opendoor have experienced massive valuation falls after going public via SPAC.

RXR wasn't the only real estate firm to launch a SPAC only to later shut it down. At the start of this year, Cain International backed out of its proposed blank check company, having previously said it would aim to raise $250M to take an entertainment or real estate company public.

While most are backing away from the industry, last week, venture capital Fifth Wall announced it had raised $866M for proptech investment, setting a record for the sector. It also announced a deal with one of its SPACs to take a company that owns and operates parking garages public.