Industry Insight Report: Construction Q2-2026

The construction industry entered Q2 2026 with mixed momentum. Overall construction spending remained high, but growth is increasingly concentrated in select categories such as data centers, power infrastructure, public projects, and certain residential segments. The U.S. Census Bureau reported April 2026 construction spending at a seasonally adjusted annual rate of $2.17 trillion, up 0.4% from March and 0.9% from April 2025. Private residential spending rose 0.8% for the month, while private nonresidential spending declined 0.2%.

For construction business owners considering an exit, this is a market where buyer interest remains active, but buyers are becoming more selective. Firms with backlog visibility, experienced crews, strong project controls, and exposure to infrastructure or mission-critical facilities are standing out.

Key Trends Shaping Construction in Q2 2026

Data Centers and Power Projects Continue to Drive Demand

AI-related infrastructure remains one of the strongest demand drivers in construction. AGC’s 2026 outlook noted that data centers, power facilities, and healthcare projects are expected to drive much of the private-sector market this year. Water, sewer, transportation, bridge, highway, and manufacturing projects are also expected to contribute to demand, although contractor expectations are more cautious than last year.

KPMG also reported that data center spending was up 28% year over year in April, while power construction rose 6% over the same period as utilities expand capacity to support data center growth. This shift matters for owners because acquirers are paying close attention to contractors tied to electrical, mechanical, site work, utility, and infrastructure scopes that support these projects.

Labor and Cost Pressure Remain Valuation Factors

Even with steady demand, labor availability and material costs continue to pressure margins. AGC reported that more than 80% of firms planning to hire say it remains difficult to find qualified hourly craft or salaried workers, and 63% of firms expect to increase headcount in 2026.

For buyers, workforce stability is now a major diligence point. A construction company with low turnover, trained foremen, documented safety practices, and dependable subcontractor relationships may receive stronger buyer interest than a similar firm that depends heavily on the owner to manage field operations.

Texas Construction Remains Active, but More Specialized

Texas continues to benefit from population growth, commercial development, energy projects, and data center demand. ConstructConnect reported that Texas leads the nation in commercial construction spending at nearly $90 billion annually, supported by manufacturing, clean energy, semiconductor, and advanced infrastructure investment.

For owners searching terms like “sell construction business Texas” or “Construction business valuation Texas,” the key takeaway is that location still matters, but specialization matters more. Buyers are looking closely at contractors serving resilient end markets, especially those tied to utilities, data centers, public infrastructure, and essential facility maintenance.

M&A Outlook for Construction Businesses

Construction M&A remains active in 2026, especially among private equity groups and strategic buyers seeking scale. Capstone Partners reported that construction M&A activity expanded in 2025 as buyers pursued workforce capacity, revenue diversification, and exposure to AI-driven data center and power infrastructure demand. Capstone also expects targets serving data center and power infrastructure end markets to attract outsized acquisition interest.

At Lion Business Advisors, we are seeing that buyers are not simply looking for revenue. They want clean financials, reliable backlog, transferable customer relationships, documented estimating processes, and leadership depth beyond the owner. Companies with these traits are better positioned for a smoother construction business sale and stronger buyer confidence.

Outlook for the Second Half of 2026

The second half of 2026 should remain constructive for well-positioned construction firms, but not all segments will benefit equally. Data centers, power, utility, and public infrastructure work continue to show strength, while office, some multifamily, and rate-sensitive residential categories remain more uneven. Owners who want to explore the market should begin by understanding what buyers would see in their financials, workforce, backlog, and customer concentration.

If you are considering a sale in the next one to three years, now is the time to speak with a Construction business broker Austin owners can trust and identify what improvements may increase buyer confidence before going to market.

Ready to understand what your construction business may be worth? Request a confidential business valuation from Lion Business Advisors.

• Lion Business Advisors’ quarterly industry insights incorporate data and trends sourced from internal deal flow and buyer activity, Vertical IQ, and market comparables from platforms such as Axial and BVR (Business Valuation Resources).