The commercial HVAC services sector continues to draw strong investor interest, driven by attractive fundamentals, according to a new industry report released by the Commercial Services investment banking team from Brown Gibbons Lang & Company (BGL).
With the level of consolidation and increasing competition for platforms and add-ons in sectors such as fire & life safety and commercial HVAC over the last few years, investors are increasingly turning to sub-sectors such as security & access control and exterior building façade services, which remain in the early innings of platform investment and consolidation.
Investors are seeking to replicate the successes that private equity firms have seen in more established sub-sectors, such as fire and commercial HVAC.
BGL managing director, Eliott Musick, said most private equity and institutional capital investors in commercial services want to know what’s next.
“The playbook is well established, and the universe of opportunities is well known in commercial HVAC and fire & life safety,” he said.
“As a result, we're focused on being out in front of the next wave of consolidation opportunities in sub-sectors such as perimeter security, exterior building façade, and commercial water treatment."
Inside the report, BGL examines the compelling attributes and fundamentals that have contributed to the strong interest and investment in the commercial services sector to date, and which sub-sectors present opportunities in the next wave of consolidation.
The report identifies the key benefits of rollup strategies including opportunities for building scale, driving efficiencies, enhancing margins, and ultimately driving EBITDA growth.
It looks at why the security & access control and exterior building façade services sub-sectors are attracting increasing interest and investment from private equity.
Corporates are divesting legacy or non-core operations and reallocating capital towards higher-growth, technology-enabled, and service-oriented businesses aligned with digitalisation, the energy transition, and the build-out of AI infrastructure.
This includes engineering and construction, according to PwC research on the investment outlook for 2026.
“Infrastructure, clean-energy, and data centre investment will support M&A activity in specialty contractors and industrial services, particularly those enabling automation, prefabrication, and higher-value, project-critical capabilities,” PwC said in a report entitled Global M&A trends in industrials and services.
“The buyer universe is expanding, and competition is intensifying for scarce assets that sit at the intersection of power, automation, and digital infrastructure.
“Strategic buyers are closing capability gaps in electrification, thermal management, automation, and digital controls, while private equity is underwriting long-duration growth through platform roll-ups in services, specialty manufacturing, and asset-light software and controls.”