On the latest episode of Behind the Buyouts, Tim Shea, partner and head of business services at Solomon Partners, discussed the evolution of private equity’s interest in residential and facilities services and strong demand for high-performing assets in 2025.

PE firms a decade ago weren’t as interested in the fragmented industry given its low barriers to entry. But they’ve come to recognize that while anyone can start a residential heating, ventilation and air conditioning company, for instance, and compete with limited capital, not everyone can turn those businesses into regional and national players that manage hundreds and thousands of technicians, according to Shea.

A rollup frenzy that took off in residential HVAC quickly spread to other corners of the industry, with PE consolidating and professionalizing everything from pest control to garage door services to roofing.

Transaction volumes in the residential and facilities services sectors, as with almost every other industry, have dropped since the highs of 2021 amid a broad economic slowdown. While dealmakers expected an improved M&A environment in 2025, uncertainty from proposed tariffs, federal spending cuts and more has tempered deal activity.

“The demand is there on the buy side, and when we see high-quality companies that are growing, that have nondiscretionary demand, that don’t have some of these question marks around tariffs or government spending or regulation, it’s a feeding frenzy, and the processes are very, very hot,” Shea said.

Shea has been advising residential and facilities services companies for more than 15 years. Solomon’s business services team recently advised on deals including Agellus Capital LLC’s February acquisition of FirePro Tech LLC, Chase Fire and Union City, AAA Fire Protection Services to create Bluejack Fire & Life Safety and the December sale of Unified Power by Incline Equity Partners to New Mountain Capital LLC holding Pearce Services LLC.

Check out the podcast with Tim Shea below:

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