Commercial Painting Contractor, 25-Year Connecticut Operator

$7.3M

Revenue

$899K

SDE

4.3x

Multiple

Subscribe Free

Read the full deal writeup

Get Free Access Access Unlimited Deals

Already a member? Sign in

Full Editorial Writeup

This is a 25-year-old commercial painting contractor based in New London County, Connecticut, generating roughly $7.3 million in annual revenue with $812k of adjusted EBITDA and $899k of seller discretionary earnings. The business is 95% commercial, which matters: commercial painting means repaint cycles on office buildings, institutional facilities, multi-family, and industrial properties rather than one-off homeowner jobs that have to be re-won one living room at a time. The company leases its facility and runs a sub-heavy labor model, with the majority of field work performed by subcontractors rather than a large W-2 crew.

What makes this listing unusual is the stated absentee operating structure. The add-back schedule includes $532,841 in management fees paid to the owner plus a separate dues and subscriptions line tied to the owner's OTHER business, which signals the current owner is already running this largely hands-off and taking cash out through management fees. A replacement owner salary of roughly $87k is baked into the adjustments, so the earnings figure is presented net of a working GM/owner. The deal is SBA pre-qualified with no seller financing offered.

At a $3.9 million ask against $899k SDE, the multiple is about 4.3x, on the higher end for a painting contractor but partially explained by scale, commercial concentration, and the manager-run structure. The sub-based model keeps fixed overhead light and makes the business more scalable, but it also raises questions about customer concentration, backlog durability, and how much of the margin depends on the owner's existing relationships and his separate business.

Why we like it

Earnings quality is solid for the category, with $812k adjusted EBITDA and $899k SDE on $7.3M revenue, implying roughly 11-12% EBITDA margins that are respectable for commercial painting. The add-back schedule is relatively clean and legible: interest, depreciation, owner comp, and a large $532k management fee that is easy to verify against bank records. SBA pre-qualification signals a lender has already looked at the cash flow and found it financeable.
The business is 95% commercial, which is the durable end of painting. Commercial and institutional clients repaint on maintenance cycles, carry larger ticket sizes, and often come back for recurring repaints, unlike residential work that must be re-won job by job. Twenty-five years in one market builds a referral and repeat-client base that is hard for a new entrant to replicate.
Painting is a non-discretionary facility expense for commercial property owners who must maintain their buildings regardless of the economy, so demand holds up better in a downturn than consumer-facing trades. Connecticut has a stable installed base of commercial and institutional buildings that need ongoing maintenance. Deferred maintenance eventually becomes mandatory, which supports a steady work pipeline.
The sub-heavy, manager-run model is an operator advantage: low fixed labor overhead, variable cost structure, and a business that already runs without the owner on the tools. A hands-on buyer who inserts themselves into estimating and sales relationships could likely expand margins and grow revenue while trimming the $532k in management fees currently extracted by the seller.

How to improve it

Audit the subcontractor base and lock in your best crews with preferred-vendor agreements and volume commitments. A sub-dependent model is only as strong as sub availability, so securing capacity early protects your ability to bid and deliver backlog. Tightening sub pricing and quality control directly protects the 11-12% margin.
Build a true recurring maintenance program by converting one-time commercial repaints into multi-year painting and facility-maintenance contracts. Property managers and institutional owners value predictable scheduled repaints, and contractual recurring work raises both margin stability and the eventual resale multiple. Even a handful of anchor maintenance accounts changes the earnings profile.
Formalize the estimating and sales function so revenue does not depend on the departing owner's relationships. The $532k management fee suggests the owner carries meaningful business-development weight; replacing that with a documented sales process and a quota-carrying estimator de-risks the handoff. This is the single biggest driver of whether the cash flow survives the transition.
Implement job-costing and project-margin tracking by client and job type if it is not already in place. Commercial painting lives and dies on bidding discipline, and granular margin data lets you kill unprofitable work and double down on high-margin repeat accounts. This also tightens your diligence story for any future buyer or lender.
Pursue geographic and adjacency expansion into neighboring Connecticut and Rhode Island markets using the existing sub network. Painting scales well because the overhead is light, so adding a second estimator and a wider bidding radius can grow revenue without proportional fixed cost. Adjacent services like power washing, waterproofing, and light drywall repair increase wallet share per client.
Diversify the client base to reduce concentration risk and chase sticky institutional accounts such as schools, municipalities, healthcare, and multi-family. These buyers repaint on reliable cycles and often favor incumbents through bid lists and prequalification. Winning a few of these creates a durable backlog that smooths out cyclical commercial construction swings.

Diligence notes

Scrutinize the $532,841 management fee add-back, which is more than half of EBITDA. Confirm exactly what work that fee represents, whether it is sales, estimating, or oversight, and how that function gets replaced for the $87k replacement salary already assumed. If the fee reflects real labor the business needs, the true normalized earnings are lower than presented.
Verify the absentee claim against reality. A business that is genuinely manager-run should have a named GM or management structure in place, so identify who actually runs estimating, bids, client relationships, and sub management day to day. If the answer is the owner through his management company, the business is not absentee and the transition risk is high.
Analyze customer and project concentration over the last three years. Commercial painting revenue can be lumpy and project-driven, so request a job-level revenue breakdown and confirm how much comes from repeat clients versus one-time bids. Understand current backlog, signed contracts, and the pipeline to judge how much 2025 revenue is contracted versus hopeful.
Pressure-test the subcontractor model for labor and compliance risk. Confirm the subs are properly classified, insured, and bonded, and review whether any could be reclassified as employees, which would change the cost structure. Also assess whether key subs would stay post-sale, since losing capacity directly caps revenue.
Because the deal is SBA with no seller financing, confirm the seller's willingness to provide a meaningful transition and training period despite not carrying a note. Review licensing, bonding capacity, and workers comp history, and validate the trailing financials against tax returns and bank statements line by line. The clean add-back schedule is a starting point, not proof.

Source

Originally listed on BizBuySell. View original listing →