Around the Industry
Market Sector Status M&A activity remains steady overall, but momentum is far from uniform. Growth is increasingly concentrated in sectors tied to sustainability, infrastructure renewal, and energy transition—areas now defining the industry’s next chapter. Recognizing where that momentum is building, and where it’s beginning to soften, offers a clearer view of what comes next. GROWTH SECTORS Environmental and infrastructure markets continue to anchor 2025 deal activity. Buyers are prioritizing practices with expertise in environmental consulting, water resources, and infrastructure resiliency—fields propelled by federal funding, ESG mandates, and long-term climate resilience goals. Energy transition work, from renewables to grid modernization and decarbonization—adds further momentum. Financially, these firms outperformed the industry median by 2%-3% ( 2025 Financial Performance Report ), offering both growth and stability. Together, these sectors have shifted from cyclical to strategic and now serve as the foundation for long-term portfolio growth across the AEC industry. MODERATING SECTORS Not all segments of the AEC industry are expanding equally. Data from the 2025 AEC M&A Outlook Survey and the 2025 Financial Performance Report point to a slowdown in commercial real estate, private development, and industrial design, particularly among architecture- focused firms. High interest rates and delayed project starts have tempered demand and narrowed buyer appetite.
Design firms with distinctive expertise or deep client relationships still attract interest, but selectivity has replaced scale as the defining factor.
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