Private Equity’s Push Into Construction and Skilled Trades — What Leaders Need to Know

Skilled trades at the center of Private Equity’s next wave

For decades, construction, HVAC, plumbing, roofing, and other trade businesses were almost entirely locally owned and family operated. That’s changing. 

In 2024 alone, over one-third (35%) of all construction M&A deals involved subcontractors, and nearly half of those were backed by private equity firms. HVAC services saw nearly 80 buyouts last year — one of the most active subsectors across the entire services economy. With billions in “dry powder” still waiting to be deployed, the construction and skilled trades sector as a whole has become a prime target for institutional capital. 

For founders, this sudden surge of outside interest is both an opportunity and a wake-up call. 

Why? Because unlike many white-collar industries being disrupted by artificial intelligence (AI), the trades remain largely AI-proof. You can’t automate a new roof, rewire a building, or install an HVAC system from a laptop. These are physical, essential services that require skilled people on the ground — and demand for them is only growing. 

While HVAC, plumbing, and electrical stand out because they provide essential services people pay for even in downturns (making them both AI-proof and recession-resistant), private equity’s interest extends much further. Specialty contractors, general construction services, and infrastructure-related companies are also highly attractive because of the sector’s fragmentation, labor shortages, and unprecedented levels of government infrastructure spending. Put simply: the entire construction services industry is in play.

Why construction service companies are suddenly attractive 

• Recurring demand. Roofs wear out, plumbing leaks, HVAC systems need maintenance — whether there is an economic recession or not. 

• Scarce skilled labor. Businesses that can recruit and retain talent have a real competitive edge. Investors know this. 

• Locally trusted brands. Customers often prefer the neighborhood company they know, making brand equity a powerful asset. 

• Room for professionalization. Many companies still run on paper, outdated systems, or the owner’s memory. With stronger systems and processes, margins can expand significantly. 

  
  

The opportunity, and the decisions, trade business owners face 

Here’s the crossroads many founders and leaders are standing at today:

1. Stay Family-Owned 

Double down on independence. But independence today requires professional-grade operations — modern systems, streamlined processes, and measurable performance metrics. The upside? You keep ownership, protect your legacy, and maintain full control. In fact, “locally owned” can be a marketable edge in a climate where communities want to support small businesses over big-money investors. 

2. Raise Capital to Grow 

Bring in outside equity or debt to scale faster — new locations, more technicians, upgraded systems, and a more sophisticated operation. You keep a meaningful stake and gain the resources to compete head-to-head with larger roll-ups. The trade-off? Share some decision-making and take on investors who expect performance and accountability. 

3. Full or Majority Exit 

Sell most or all of your company. For many owners nearing retirement, this is the opportunity to turn decades of hard work into financial freedom. Some deals also allow you to keep a minority stake for a potential “second bite of the apple” if the platform resells later. 

The bigger picture: wealth and consolidation 

There’s no denying the bigger conversation. On one hand, private equity represents the 1% consolidating wealth and ownership. Instead of local families holding these businesses, profits increasingly flow to institutions and investors. Communities often value “local first,” and there’s legitimate concern about what happens when too much power and profit leave the community. 

On the other hand, for founders and owners, this may be the best window you’ll ever have to cash out or partner with capital. 

You can walk away with life-changing wealth, or bring in resources to expand far beyond what you could have achieved alone. 

Either way, the message is clear: the opportunity is here, and the game is changing. If you want to stay in the game, your company has to evolve. The real question is: will you shape this opportunity, or let it shape you? 

Legacy Ready: positioning yourself for options 

Whether you want to stay family-owned, bring in outside capital, or prepare for a full exit… The conclusion is the same: your business needs to run like a well-oiled machine. That means clean financials, strong systems, operational efficiency, delegated leadership, and a clear growth plan. 

At Valtoro Consulting, this is exactly what we help you build with our Legacy Ready Program. We position your business to be investable, scalable, and sellable. That way, you stay in control. You have leverage. And you can choose when and how to make your next move — not because you’re forced to, but because you’re prepared.  

If you would like to learn more about our Legacy Ready Program and how we can help you, contact us here.  

References & Further Reading 

• Capstone Partners – Construction Services M&A Update (Jan 2025) 

• Contractor Magazine – Active Construction Market Accelerated M&A in 2024 

• PKF O’Connor Davies – US HVAC Services Industry Update (2024) 

• KPMG – Roofing Contracting M&A Market Update (2025) 

• Wall Street Journal – America’s New Millionaire Class: Plumbers and HVAC Entrepreneurs 

• The American Prospect – Private Equity Intensifies Rollups of HVAC Installers 

• Associated Builders & Contractors – Construction Workforce Shortage Tops Half a Million (2024–2025) 

• U.S. Department of Transportation – Infrastructure Investment & Jobs Act (IIJA) Overview