The Built Environment: Safety and Compliance Imperative Creates Tech Opportunity

Featured professionals: Thierry Monjauze, Brian Titterington, Erik Szyndlar

Powerful themes are driving increasing demand for specialized technologies throughout the built environment. Within this ecosystem, the architecture, engineering, and construction (AEC) and real estate and property management sectors have an especially strong need for compliance and supply chain risk management tools. Companies offering innovative technology that solves complex challenges across these categories have significant growth potential.

Below, senior professionals in our Technology Group discuss what’s creating investor interest in these solutions and how recent Harris Williams clients Highwire and NetVendor exemplify the segment’s M&A opportunity.

Converging Dynamics

Multiple tailwinds are propelling AEC market expansion, including U.S. and European reshoring initiatives that are bolstering major domestic manufacturing projects. In addition, the semiconductor market, fueled by the proliferation of generative AI and advanced computing, is looking to ramp up production. AI demand is also powering the build-out and improvement of data centers.

Along the same lines, various macroeconomic and socioeconomic trends are driving long-term demand for construction, such as onshoring of pharmaceutical and advanced manufacturing capacity; an aging population and complex public health challenges that require large-scale healthcare and research facility investment; and a housing availability and affordability crisis that is driving a need for more multifamily projects.

This wide-ranging construction growth is creating a surge in demand for contractors and, subsequently, a greater need for technology to enhance efficiency, drive profitability, ensure safety, and better manage risk. “In a more complicated built environment, safety, risk management, compliance, and productivity are critical to asset owners,” says Thierry Monjauze, a managing director. “They need technology and data-driven solutions that address both contractor risk, including financial and safety risk, as well as operational efficiency throughout the construction and asset project life cycle.”

Similarly, a variety of long-term trends are boosting technology adoption in the increasingly complex real estate and property management sector. For example, a rising number of lifelong renters, downsizing baby boomers, and housing affordability are fueling demand for many types of rental properties. As a result, housing demand is outpacing supply, and despite record-high unit development, vacancy rates remain at all-time lows.

“With more renters, a greater need for housing, and increasingly complex property profiles, property managers are leaning on next-generation solutions to more efficiently manage their expansive operations and gain greater visibility into their supply chains to manage risk,” says Brian Titterington, a managing director. “This technology is critical to enhance the tenant experience, drive predictive maintenance, and ensure compliance with regulatory and sustainability standards, among other benefits.”

As the use of advanced technology becomes more vital to the built environment, investor appetite for best-in-class providers will continue to expand. “Many of the most sought-after solutions unify all constituents in a value chain, from buyers and contractors to property managers and maintenance services, which provides a powerful network effect and helps achieve each party’s business objectives,” adds Titterington. “Our recent clients, Highwire and NetVendor, are two leading companies that demonstrate the sector’s growth opportunity.”

Highwire: AEC Contractor Risk Management

Highwire offers a cloud-based contractor risk management platform built to serve asset owners and contractors (GCs and sub-contractors) in high-growth verticals. The technology spans the construction life cycle, including preconstruction and contracting, construction, closeout, and maintenance. It also supports risk mitigation, from operational prequalification to integrated field safety applications. Overall, Highwire can help organizations build and operate facilities more safely, quickly, and profitably.

Erik Szyndlar, a managing director, notes that Highwire is trusted by customers across many sectors. “As Highwire continues to participate in all tiers of the construction ecosystem, it is poised to benefit from network effects,” he says. “It has built a scalable model powered by strong data generation and recurring revenue, enabling growth going forward.”

NetVendor: Vendor Compliance and Workflow Management

NetVendor’s scalable property management software streamlines complex vendor compliance, credentialing, and maintenance. By saving time, reducing risk, and boosting operational efficiency for both property managers and vendors, the business has become a leading compliance and workflow platform in the fastest-growing real estate segments.

Like Highwire, NetVendor was an especially appealing investment opportunity due to its differentiated and well-established network model. “The company’s strong market position, innovative offering, and compliance-driven network helped make it the platform of choice in the property management market,” says Titterington. “NetVendor is well positioned to continue delivering significant value to property managers, vendors, and maintenance teams and has the potential to expand into adjacent segments.”

A Focus on Integrated, Scalable Capabilities

While Highwire and NetVendor serve different segments of the built environment, both provide customers with better and more efficient management of compliance, supply chain risk, and workflows. They are also establishing valuable data and scale as they build networks that bring together multiple parties in their value chains.

“Best-in-class technology businesses focused on the built environment are creating highly scalable, integrated platforms and strong networks,” says Monjauze. “Those with advanced solutions that serve high-growth end markets and a diverse set of customers will be positioned for long-term growth and investor interest.”

To discuss the M&A potential within AEC and property technology, please contact our senior professionals.