Why 25/26 is a Golden M&A Era for Construction, Engineering and Home/Facility/Industrial Service Firms

Todd
6 days ago
4 min read

Updated: 5 days ago

Across the construction, A/E and the home/facility/industrial services sectors, the story is the same: demand for acquisitions is outpacing supply and buyers are paying premium multiples (6-15x) for companies.

The Market is Accelerating: A Look at the Numbers

After a record-breaking 2024 that saw deal activity in the Construction & Engineering (C&E) sector surge by 34%, the market has defied expectations and accelerated into 2025.

o 1H 2025 A/E grew by 31% by deal count and 41% by total deal value

o 1H 2025 construction and home/facility/industrial services grew by 28% by deal count and total deal value

o Sector valuations represent a 17.3% increase in the average EBITDA multiple since 2018.

o The sector has grown QoQ for 7 straight quarters. The last down quarter was Q3 2023.

Why? Because the macro and industry fundamentals are stronger than ever. The merger and acquisitions (M&A) landscape for high-quality construction, A/E and home/facility/industrial services firms is not just "active"—it's experiencing a sustained surge of buyer interest at record-breaking valuations. This isn't speculation; it's a trend validated by data.

Buyers, flush with capital, are actively and aggressively seeking to invest in this space. And they aren’t just looking; they are closing deals at premium prices.

Why Your Sector? The New "Safe Haven" for Buyers & Epicenter of Demand

What’s driving this frenzy? In an uncertain economic environment, buyers are prioritizing resilience. They’ve recognized that the services you provide are not optional; they are essential.

This has turned the C&E and home/facility/industrial services sectors into a "safe haven" for capital, prized for three key factors:

Resilient, Recurring Revenue: Buyers (especially private equity) are in love with the "essential services" model. This offers non-discretionary, needs-based services and sticky recurring revenue from maintenance and service contracts. This provides the "visible cash flow" that acquirers/investors crave.
A Fragmented Market: The C&E and home/facility/industrial services industries are famously fragmented, full of best-in-class, founder-led businesses. Buyers see this as a massive opportunity. They are executing "roll-up" or "platform" strategies.
Massive Tailwinds: This isn't a short-term blip. Buyer demand is underpinned by powerful, long-term trends:

o Aging Infrastructure: The U.S. home and commercial building stock is aging (the median U.S. home is over 40 years old), guaranteeing decades of repair, replacement, and retrofit demand.

o Infrastructure Spending & Reshoring: Massive public and private investment in infrastructure, power grids, and data centers, combined with the "reshoring" or "nearshoring" of manufacturing, is creating a pipeline of large-scale projects for years to come via governmental programs - IIJA, IRA, CHIPS, etc.

o The Technology & Labor "Problem": Ironically, the very challenges you face — labor shortages and the need for new technology—are making you more attractive. Acquirers are confident they can use their capital and scale to solve these problems, making established businesses with skilled crews a prime candidate.

This intense buyer interest is not just general—it is highly concentrated in the sectors you operate in.

For Specialty Construction & Home/Facility/Industrial Services: This segment is, by far, the most active. The "Specialty Construction" category (which includes plumbing, electrical, HVAC, roofing and others) saw a blistering pace that has only continued into the first half of 2025.
For A/E & Consulting Firms: The "Specialty Engineering" category is seeing the same spike. Buyers are actively seeking firms with expertise in project management, design, and advisory services, especially those supporting infrastructure, data centers, and energy projects.

The Most Important Stat: Sellers are Winning at the Exit

This high-activity market is translating directly into wealth-generating events for owners.

Perhaps the most telling statistic comes from 2024 exit data. While the number of owners selling their C&E businesses rose by a healthy 36%, the total value of those exits skyrocketed.

Total exit value in 2024 increased 82% from the prior year and that momentum continued into the 1H 2025.

This massive gap between the number of sellers and the value they received means one simple thing: owners who sold, sold for a premium, top-dollar valuation.

A Window of Opportunity

We are now in a "market thaw" where buyers and sellers are aligning on valuations, and the pressure on investment funds to deploy their capital is immense. Owners nearing retirement, looking to exit, recapitalize or divest, are finding they can fetch premium valuations while simultaneously avoiding the future headaches of the next business cycle or labor crunch.

This combination of peak activity, strategic buyer demand, and record-setting exit values has created a window of opportunity.

If you are an owner thinking about your next chapter via an exit, recapitalization or divestiture, the current market is sending an unmistakable signal: it is an extraordinary time to be a seller.

I invite you to a confidential, no-obligation conversation to discuss your company’s position, your wants and concerns and the unprecedented value the current market is placing on your specific business.

For over 27 years, I’ve been delivering M&A expertise. Vercor and I serve as a trusted partner to help build long term, iterative strategies that ensure you are positioned to meet your unique personal and financial goals whether it is selling, recapitalizing, acquiring or divesting of a division. Call or email me to learn how this data relates to your company.