flexiblefullpage
billboard
interstitial1
catfish1
Currently Reading

M&A activity down in 2013 among architecture, engineering firms: Report

M&A activity down in 2013 among architecture, engineering firms: Report

Many of the firms that have traditionally been the most active buyers in the industry spent 2013 mostly on the sidelines. 


By Morrissey Goodale | February 5, 2014
In 2013, consultant Morrissey Goodale observed 168 sales of U.S.-based architecture and engineering (“A/E”) firms – down nearly 7% from the record 180 sales of U.S.-based A/E firms in 2012. Similarly, just 107 international A/E firms sold in 2013, a drop of more than 20% from the 135 deals in 2012. Yet 2013 was anticipated by many to be another break-neck, record-setting year for A/E industry M&A. The economy continued to recover, performance at many firms climbed back to pre-recession levels, and things were looking up for a year of rapid deal-making. So what caused industry dealmakers to slow down after living 2012 in the fast lane? 
 
·       Owners rode the (modest) wave. As the economy persisted to creep toward respectability in 2013 and value continued to build in A/E firms, prospective sellers showed an increasing reluctance to jump at offers. Instead, they were inclined to take the longer view of building a track record of solid performance, desiring to sell at the high (or at least higher) water mark that many A/E firm leaders believe is still on the horizon.
 
·       Tax-driven deal spike late in 2012. U.S. sellers seemed to be certain they needed to sell in 2012 to minimize capital gains which were anticipated to climb in 2013. We observed an unusually high flurry of deal activity in late 2012, seemingly driven by a desire to get deals done by year end. With tax rates steady for the foreseeable future, we anticipate the competitive environment, age, ownership and leadership transition, and other factors will drive owners’ desires to sell their firms.
 
·       Large firms took a breather in 2013. Many of the firms that have traditionally been the most active buyers in the industry spent 2013 mostly on the sidelines. Firms like AECOM, SNC-Lavalin, Genivar (now WSP Global), IBI Group, ARCADIS, and URS, among others, slowed or stopped their M&A programs in 2013. This decline may be attributable to the need to integrate the firms they acquired over the last few years, work on internal initiatives, or simply being unable to find and close deals that met their strategic needs at appropriate valuations in 2013.
 

About Morrissey Goodale LLC

Based in Newton, Mass., Morrissey Goodale LLC is a leading management consulting and research firm serving the architecture, engineering, and Construction (AEC) industry. 

Related Stories

Architects | Feb 28, 2022

JLL continues expansion in Southwest with acquisition of San Diego’s Gilliland Construction Management

JLL announced that it has completed the acquisition of Gilliland Construction Management, a leader in project and construction management services for life sciences, lab, retail, hospitality, industrial, multifamily, and office properties.   

Codes and Standards | Feb 24, 2022

Most owners adapting digital workflows on projects

Owners are more deeply engaged with digital workflows than other project team members, according to a new report released by Trimble and Dodge Data & Analytics.

Multifamily Housing | Feb 24, 2022

First new, mixed-use high-rise in Detroit’s central business district in nearly 30 years opens

City Club Apartments completed two multifamily projects in 2021 in downtown Detroit including the first new, mixed-use high-rise in Detroit’s central business district in nearly 30 years.

| Feb 24, 2022

Signs of ‘Antiwork’ appear in the architecture industry

Reddit's r/Antiwork forum highlights the mounting pressures everyday workers face in a purely capitalistic society. AEC industry professionals are not immune to these pressures.

Office Buildings | Feb 23, 2022

The Beam on Farmer, Arizona’s first mass timber, multi-story office building tops out

The Beam on Farmer, Arizona’s first mass timber, multi-story office building, topped out on Feb. 10, 2022.

Codes and Standards | Feb 21, 2022

More bad news on sea level rise for U.S. coastal areas

A new government report predicts sea levels in the U.S. of 10 to 12 inches higher by 2050, with some major cities on the East and Gulf coasts experiencing damaging floods even on sunny days.

Wood | Feb 18, 2022

$2 million mass timber design competition: Building to Net-Zero Carbon (entries due March 30!)

To promote construction of tall mass timber buildings in the U.S., the Softwood Lumber Board (SLB) and USDA Forest Service (USDA) have joined forces on a competition to showcase mass timber’s application, commercial viability, and role as a natural climate solution.  

University Buildings | Feb 18, 2022

On-campus performing arts centers and museums can be talent magnets for universities

Cultural facilities are changing the way prospective students and parents view higher education campuses.

University Buildings | Feb 17, 2022

A vacated school in St. Louis is turned into a center where suppliers exchange ideas

In 1871, The Carondelet School, designed by Frederick William Raeder, opened to educate more than 400 children of laborers and manufacturers in St. Louis. The building is getting a second lease on life, as it has undergone a $2 million renovation by goBRANDgo!, a marketing firm for the manufacturing and industrial sectors.

Data Centers | Feb 15, 2022

Data center boom: How two AEC firms plan to meet unprecedented demand for data center facilities

Ramboll's Jim Fox and EYP Mission Critical Facilities' Rick Einhorn discuss the recent joining of their companies at a time of unprecedented data center demand. BD+C's John Caulfield leads the discussion with Fox, Ramboll's Managing Director for the Americas, and Einhorn, EYP Mission Critical Facilities' Managing Director.

boombox1
boombox2
native1

More In Category

Warehouses

California bill would limit where distribution centers can be built

A bill that passed the California legislature would limit where distribution centers can be located and impose other rules aimed at reducing air pollution and traffic. Assembly Bill 98 would tighten building standards for new warehouses and ban heavy diesel truck traffic next to sensitive sites including homes, schools, parks and nursing homes.




halfpage1

Most Popular Content

  1. 2021 Giants 400 Report
  2. Top 150 Architecture Firms for 2019
  3. 13 projects that represent the future of affordable housing
  4. Sagrada Familia completion date pushed back due to coronavirus
  5. Top 160 Architecture Firms 2021