KEY HIGHLIGHTS AT A GLANCE:

Historically, M&A activity in the DACH construction sector lagged well behind other industries. For instance, the software sector alone recorded 867 transactions involving DACH targets in 2020 - around 13x the level seen in construction. Since 2021, the situation has shifted fundamentally. Between 2021 and 2025, the average deal volume in the construction sector was more than double than in 2015–2020 - an increase of roughly 124%. IMAP has analysed the key drivers behind this development and structured them into pull and push factors.

1.      PULL FACTORS: WHAT MAKES THE SECTOR ATTRACTIVE TO INVESTORS

• Persistently rising demand in infrastructure & residential construction: The structural backlog in both areas creates a market environment that is largely independent of economic cycles and offers long-term planning certainty.
• Consolidation wave in the construction sector: The highly fragmented, SME-dominated market structure offers significant synergy potential and attractive buy-and-build opportunities for both strategic investors and financial sponsors.
• Massive public infrastructure investments: Extensive government programs, including the €500 billion special fund (“Sondervermögen”), are further accelerating investment momentum and increasing the sector’s attractiveness.

2.      PUSH FACTORS: WHAT INCREASES THE WILLINGNESS TO SELL AND OPENNESS TO EXTERNAL CAPITAL

• Higher costs for building materials and construction services: Sharp cost inflation since 2021 has intensified margin pressure. As a result, many companies are increasingly open to outside capital and strategic partnerships.
• Higher financing costs following the interest rate shift: Since 2022, rising interest rates have reshaped financing costs, valuations and project structures - prompting many market participants to explore alternative capital solutions and partnerships.
• Demographic change and unresolved succession: The retirement of the baby boomer generation is leading to a growing number of unresolved succession situations in the SME-dominated construction sector. This is noticeably increasing the willingness of many business owners to consider a sale.

Increasing regulation & digitalisation – drivers on both sides: Stricter energy and climate requirements are significantly increasing the need for modernization and renovation in the building sector. This creates attractive, consolidatable growth niches for well-capitalized investors.

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