Engineering Is Booming. Private Equity Wants In.

Natick, MA (July 12, 2024) – According to Bisnow, Towering skyscrapers, sprawling developments and buzzing retail centers have long appealed to private equity groups, whose investors can see, touch and tour the tangible assets that bring in revenue. 

Now those same investors are increasingly seeing the value in the typically unseen engineering firms behind the projects. That’s largely due to a mass of federal funding flooding into infrastructure and construction projects, and some engineering firms say they are fielding acquisition offers on an almost weekly basis.

What that portends for the industry is a matter of debate, with some viewing the consolidation as much-needed fuel for growth and others worried about a shrinking competitive field.

“We get approached two or three times a month,” Stephen DeSimone said about private equity interest in his firm, Manhattan-based DeSimone Consulting Engineering. “It used to be once a year, maybe twice a year. They used to be pretty discreet about it. Now they just leave voicemail messages.”

Private equity spent $4.5B on engineering and construction acquisitions last year. This year is tracking to be the fourth year in a row with more than 400 mergers and acquisitions in the architecture, engineering and environmental space, and 41% of all year-to-date deal activity was backed by private equity buyers. Read more from Bisnow News.