Built Environment & Industrials: Reasons to Be Cheerful?
The first half of 2025 has seen muted deal activity in the UK mid-market—unsurprising given the backdrop. Weak recent trading, valuation mismatches, geopolitical uncertainty, and tariff concerns have all contributed to a cautious tone. A lack of high-quality assets coming to market has further limited momentum.
Bolt-ons have continued, and there have been a few standout platform deals—Tetra Consulting, Ventro, and Metcor among them—but overall sentiment remains subdued.
Looking ahead, there are clear structural reasons to remain optimistic about the longer-term prospects for UK built environment and industrials. These include:
- Aging infrastructure and sector-specific tailwinds, such as the UK’s data centre boom, driving sustained demand across engineering, civils, M&E, and fit-out supply chains.
- Rising defence investment, with the government committing £1.5bn to tech development and submarine programmes expected to create over 30,000 jobs. For a deeper analysis of defence opportunities, read our recent article: Why Private Equity is turning to UK defence tech SMEs.
- Tightening regulatory standards, fuelling demand across fire safety, environmental consulting, and testing & inspection.
- Supply chain localisation, as businesses respond to geopolitical risk and tariff exposure by reshoring critical operations.
- Growing tech adoption, with areas like digital twins, field service management, asset tracking, and security gaining traction.
- ESG pressure as a growth driver, with sustainability now central to procurement in both construction and manufacturing.
- Energy transition tailwinds, presenting opportunities in renewables (e.g. offshore wind, grid upgrades, EV infrastructure) and in oil & gas (e.g. decommissioning, emissions reduction).
Not all these themes will unlock immediate returns, but each reflects a deeper structural shift that will underpin long-term opportunity.
To explore specific opportunities or share perspectives on where value is emerging, get in touch with:
Matt McNally
mmcnally@armstrong-ts.com
+44 7894 736 523