Investment Banker Weighs in on Building Material Sector

Jayson Gitt

To say 2026 has been a tumultuous year for building materials would be quite an understatement. Consolidation, in particular, remains a top-of-mind topic for independents eager to keep swimming in a market occupied by much larger competitors.

Here to make some sense of the situation is Jayson Gitt, a Director at PMCF Investment Banking's Denver office. He started in the investment banking industry in 2008 and has experience advising buy and sell side M&A transactions, sourcing and structuring capital for debt and equity transactions, and corporate finance initiatives. 

Here's what he had to say about the current building products landscape, along with big opportunities to explore looking ahead. 

Q: How can independents survive and distinguish themselves amid accelerating consolidation?

Gitt: Scale certainly has advantages, but size alone doesn't win in building products.

The independents that continue to thrive are typically those that offer something difficult to replicate, whether that's exceptional service, technical expertise, proprietary products, or long-standing relationships within a specific end market. As consolidation accelerates, many larger organizations become increasingly focused on standardization and operational efficiency, which can create opportunities for smaller businesses that remain highly responsive and customer-focused.

We're also seeing customers place a greater premium on specialized capabilities. Contractors, architects, and owners often prefer partners that can solve difficult problems, provide application support, or offer tailored solutions rather than simply supplying a commodity product.

In many cases, the most successful independents aren't trying to compete with the largest players across every market. They're becoming the dominant player within a niche, geography, or product category where expertise and relationships matter more than scale.

Q: Which niche building materials sectors do you see larger acquirers pursuing next?

Gitt: Buyers continue to gravitate toward businesses benefiting from long-term demand drivers rather than purely cyclical construction activity.

The areas attracting the most attention today tend to have exposure to infrastructure investment, power generation, grid modernization, energy efficiency, and data center development. Many acquirers are also looking for products that are highly specified, technically differentiated, or embedded in critical building systems because those characteristics generally support stronger margins and customer retention.

I expect continued interest in specialized electrical, building-envelope, temperature and air-management, and engineered products that solve increasingly complex construction and performance requirements. 

Regardless of the product category, buyers are looking for businesses that combine attractive growth profiles with differentiated offerings and strong market share positions.

Q: What building product niches do you see becoming increasingly important over the next several years, and which may face greater pressure?

Gitt: The strongest growth will likely come from product categories aligned with several powerful themes: sustainability, electrification, infrastructure investment, energy efficiency, labor productivity, and data center development.

We're already seeing increased interest in timber, prefabricated and modular construction solutions, advanced building-envelope systems, power-distribution equipment, energy-efficient materials, and products that help reduce labor requirements in the field.

On the other hand, traditional products aren't going away, but some commodity-oriented categories may experience slower growth and greater pricing pressure. Products that are difficult to differentiate and compete primarily on price typically face more margin compression over time.

The distinction is becoming less about material type and more about value creation. Products that improve performance, shorten installation times, reduce labor requirements, or support sustainability goals are likely to capture a larger share of future investment.

Q: How can building products companies participate in the data center boom?

Gitt: Many companies underestimate how broad the opportunity really is.

When most people think about data centers, they focus on the technology, servers, and computing infrastructure. In reality, data centers are massive construction projects that require enormous amounts of power, cooling, building materials, and specialized construction components. AI-driven demand continues to accelerate development, creating opportunities across much of the building products value chain.

The most obvious beneficiaries are manufacturers supplying products tied directly to electrical infrastructure, cooling and air-management systems, structural systems, and specialized enclosure solutions. However, opportunities also exist for companies serving adjacent markets through logistics, prefabrication, engineered components, building-envelope systems, and other mission-critical construction products.

The biggest opportunity is often not creating a product specifically for data centers, but understanding where an existing product fits within the ecosystem and how it can improve reliability, efficiency, speed of construction, or long-term operating performance.

Over the next decade, the data center market is likely to represent one of the most significant construction and infrastructure investment cycles in history, creating opportunities well beyond the traditional technology supply chain.