If you own an HVAC company in Dallas-Fort Worth and are thinking about selling, here's what buyers actually pay, what they look for, and how to prepare.
Think about the plumbing behind your walls. You do not see it. You do not think about it. Until something goes wrong. And then it is the only thing you think about.
That is HVAC in a North Texas summer. Everyone needs it. Most people have no idea what it is worth until it stops working. And almost nobody, including a lot of business owners I have talked to, understands what a well-run HVAC business in DFW is actually worth to a buyer.
I have seen HVAC owners sell to the first roll-up that called them because they were tired and just wanted it done. And I have seen owners take their time, understand the market, and find the right buyer. The outcomes are not similar. At all.
Berkman Woods acquires HVAC companies as part of our specialty contracting strategy in Texas. Here is how we think about valuation, what we look for, and what separates a 3x deal from a 6x deal.
HVAC companies in DFW typically trade at 3.5x–6x EBITDA. The range is wide because the businesses themselves vary enormously. A $5M revenue company doing primarily new construction subcontracting looks nothing like one doing $5M with 300 active service contracts and a significant commercial maintenance base.
A simple example: an HVAC company doing $4.5M in revenue with $900K in EBITDA. Owner pays himself $180K when the market rate for the role is $130K. Runs two personal vehicles through the business at a combined $30K per year. Normalized EBITDA comes out to roughly $980K. At 4x, that is $3.92M. At 5.5x, because the company has strong recurring revenue, that is $5.39M. The difference of $1.47M is driven almost entirely by revenue mix and business quality, not by revenue size.
HVAC companies with residential and commercial service agreements command premium multiples because buyers can underwrite them with confidence.
Think about it from the buyer's side. 400 residential service memberships at $180 per year is $72K in recurring annual revenue that shows up whether the summer is brutal or mild. Add 50 commercial maintenance contracts averaging $6K per year and that is another $300K in predictable revenue. A company with $370K in contract-based revenue sitting beneath a $900K EBITDA business is valued very differently from one where every dollar is reactive service call work.
I have seen a buyer walk into a room to evaluate a $5M HVAC business and discover that the owner personally services all 200 maintenance contracts. Personally. That conversation takes a very specific direction. If you do not have a structured service program, starting one now, even a basic one, will meaningfully improve your valuation in 18–24 months.
Commercial HVAC, office buildings, retail centers, industrial facilities, data centers, is generally preferred by institutional buyers. Contract sizes are larger. Relationships with property managers and facility directors are stickier than individual homeowner relationships. Margins on maintenance work are better than on installation. And in the DFW market specifically, commercial development is accelerating in the Frisco–Plano–Allen corridor and the Las Colinas–Coppell area.
Strong residential businesses are also acquirable, particularly when they have documented service programs, trained technicians who will stay post-close, and geographic concentration in high-income areas like Collin County where homeowners pay for quality work.
The owner is the only person customers call. When the home warranty company, the property manager, and the builder all have the owner's personal cell number, a buyer has a structural problem that does not go away.
No service agreements. All reactive, no recurring. Buyers model this as high volatility and discount the multiple accordingly.
Technician turnover above 30% annually. In a market where hiring HVAC technicians is already difficult, a company that cannot retain people is telling a buyer something important about the work environment or management.
Equipment financed on the owner's personal credit. This complicates deal structure and sometimes creates real problems at close.
Three years of tax returns that do not match what the seller claims verbally. This is the fastest way to lose a buyer's trust, and once it is gone, it does not come back.
Most HVAC acquisitions in the DFW market in the $2M–$8M enterprise value range use SBA 7(a) financing. The program expands the qualified buyer pool considerably. You are not just selling to someone with $3M in liquidity. You are selling to any capable operator who qualifies for SBA approval.
SBA underwriting is thorough. The lender will examine three years of tax returns, validate your DSCR, and scrutinize the quality of your earnings. A buyer who cannot get SBA approval because your financials are messy is a deal that does not close. Clean books are not optional in this market.
DFW consistently ranks among the most active HVAC acquisition markets in the country. Population growth, commercial construction, and data center development are driving sustained demand that buyers can model. Buyers are actively looking. If your business is well-run, your financials are clean, and you are in the right service area, this is a good moment to understand what you have.
Berkman Woods acquires HVAC businesses in DFW and the broader Texas market. We understand the sector, use SBA 7(a) financing, and prefer to work directly with owners before a formal process begins. If you want to know what your business is worth, without entering a broker process, that conversation starts here.
Related: For Business Owners · Specialty Contracting
