Hartford Business Journal

HARTFORDBUSINESS.COM | March 6, 2023 25 FOCUS: BANKING & FINANCE Home Sales Here's a list of recently sold luxury homes in Greater Hartford. Sale price Address Town Beds Baths Square footage Days on market $1,510,000 16 Brocklesby Avon 7 5 7,074 8 $1,129,000 511 Mountain Road West Hartford 5 5 4,260 62 $1,014,000 15 Hadley Drive Avon 7 6 8,172 5 $955,000 62 Bagno Drive Southington 4 5 3,764 156 $845,000 131 Valley View Court Southington 4 3 4,027 105 $828,507 69 Nelson Drive Burlington 4 4 3,179 0 $800,000 101 Wildwood Drive Avon 5 4 4,650 2 $750,000 177 Highcrest Road Wethersfield 4 4 3,912 145 $658,516 17 Griswold Place Simsbury 3 2 1,862 0 $650,000 72 Hollister Drive Avon 3 4 3,512 13 $650,000 596 Wolcott Road Bristol 3 2 3,156 16 $650,000 80 Owens Lane Glastonbury 3 4 2,780 2 $648,500 35 Chestnut Circle Suffield 4 3 3,106 26 $630,000 212 Candlelight Drive Glastonbury 3 4 2,408 1 $624,500 3 Greenwood Road Granby 4 4 4,075 27 $620,000 16 Talcott Notch Road Avon 3 4 3,768 235 $620,000 18 South Quaker Lane West Hartford 4 4 2,493 8 $610,000 714 Prospect Avenue Hartford 4 5 4,857 46 $599,900 179 Windermere Ridge Drive Southington 3 4 2,923 12 $595,000 291 Brewster Road Bristol 5 4 3,795 22 Credit: Data provided by Evan L. Berman of William Raveis Broder Team. Contact him at evan@brodergroup.com. or to a financial buyer like a private equity firm." FML's Milone said private equity firms have been sitting on a lot of cash waiting for good value opportunities in the M&A space. That's why they've been particularly active buying up Connecticut firms ranging from small machine shops to insurance agencies. Firms looking to make a strategic purchase often operate in similar or adjacent industries as their acquisition targets, he said. However, what's happened more recently — because of inflation, higher interest rates and overall economic uncertainty — is a disparity in valuations: buyers simply aren't willing to pay what they previously were pre-pandemic. "The buyers are seeing more value in buying now because the valuations are going down," Milone said. "It used to be a seller's market because the valuations were so high and they could get what they wanted and they were driving the process. Now what we see is that the value has kind of shifted a little bit." The gap between buyer's and seller's expectations has slowed M&A activity, Hardy said. Access to capital has also gotten more challenging. Hardy said banks in general aren't willing to put up as much debt on transactions as they would have a year or two ago, which exacerbates that gap. Lenders are also being more conservative and risk-averse when backing M&A deals. "We might have been willing to put more debt on a company a year ago or a year and a half ago than we are today, so that has increased the challenge of making loans to support M&A transactions," Hardy said. Butler, the Brown Paindiris & Scott lawyer, said reduced M&A activity to close 2022 could be attributed to tougher market conditions and higher interest rates, which makes financing more difficult and expensive, curtailing buyer's purchasing power. Some buyers are turning to multiple lenders to finance deals. "Years ago, the interest rates were very low, and now they're at least double what they were a couple years ago. So, I would say that's a determining factor" impacting M&A activity, Butler said. Milone said buyers right now are targeting well-run companies with quality management teams. Differentiation in product segments is also important, he said, especially for startups hoping to introduce new technologies to market. "If you're a good quality company with a good management team and a good product or service or technology, there's always going to be an opportunity to merge into bigger companies," Milone said. Source: KeyBanc Capital Markets Fourth Quarter 2022 Mergers & Acquisitions Quarterly Source: KeyBanc Capital Markets Fourth Quarter 2022 Mergers & Acquisitions Quarterly

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