2025 AEC M&A Outlook Report
11
According to The Birmingham Group (2024), approximately 78 percent of total US construction spending originates from private investment, while 22 percent comes from public projects. 10 This distribution highlights the industry’s dual foundation: steady institutional and infrastructure work on the public side, and a diverse array of private development in manufacturing, logistics, data centers, and adaptive reuse. Public-sector clients remain the most reliable revenue base, providing multi-year visibility and predictable funding pipelines through federal and state infrastructure programs. Private-sector projects, while smaller in share, continue to drive innovation and margin expansion, particularly for firms diversifying into fast-growing, technology-intensive markets. This balance reflects a resilient model: public work sustaining operational stability, complemented by strategic private projects that enhance profitability, adaptability, and long-term growth. PRIME VS. SUBCONSULTANT WORK On average, firms reported that approximately 70% of their projects are delivered as a prime consultant, with 30% or less performed in a subconsultant role. Larger firms—particularly those exceeding 500 employees—tended to operate at even higher prime percentages, which reflects their broader technical capacity and deeper institutional relationships. Smaller and niche specialty firms continue to serve more frequently as subconsultants. Prime roles allow greater control over fees, schedules, and scope, which can translate to stronger margins and higher valuation multiples. PUBLIC SECTOR VS. PRIVATE SECTOR
10 The Birmingham Group, “Construction Spend Trends: Private vs. Public Projects and What it Means for Job Opportunities” (2024), www.thebirmgroup.com/construction-spend-trends-private- vs-public-projects-and-what-it-means-for-job-opportunities/
Made with FlippingBook Annual report