How Private Equity Is Buying Up HVAC Companies

Episode notes

Lucas and Luna dive into the wave of private equity consolidation in the HVAC industry, focusing on the roll-up strategy behind companies like Service Champions and the valuation multiples that have doubled since 2020. They break down why residential HVAC service - with its recurring revenue from maintenance contracts, high barriers to entry for independent operators, and predictable replacement cycles - has become a favorite target for firms like Leonard Green & Partners and Berkshire Partners. Lucas explains the typical 'buy-and-build' playbook: acquire a regional platform, centralize back-office functions, then bolt-on smaller shops to expand geographic coverage. Luna questions whether consolidation actually improves service quality for homeowners and whether the debt loads these roll-ups carry could become a problem if housing turnover slows. By June 2026, with interest rates still elevated, the hosts discuss how the math has shifted - and why some firms are now pivoting toward commercial HVAC as the residential market gets crowded.

• Why Private Equity Is Buying Up Wedding Venues47 / 100
• How Private Equity Is Buying Up Dermatology Practices39 / 100
• How Private Equity Is Buying Up Laundromats42 / 100
• How Private Equity Is Buying Up Marijuana Dispensaries
• How Private Equity Is Buying Up Security Guard Companies