Riverside Co
. said it invested in
SAFEbuilt LLC, which provides community development services for local
governments and public entities, primarily those looking to privatize
public services.
Established in 1992 and based
in Loveland, Colo., SAFEbuilt offers services such as building
department programs, planning and zoning, code enforcement and other
administrative functions. Its affiliate company, Meritage Systems,
provides workflow and operational support software for municipal
building departments, Riverside said in a news release.
The Cleveland firm, which
didn't disclose the terms of the transaction in the release, said the
investment was made from its microcap fund.
The latest such vehicle,
Riverside Micro-Cap Fund III LP, closed with $350 million in July and
targets U.S. companies generating up to $5 million in annual earnings
before interest, taxes, depreciation and amortization.
Brad Resnick, a Riverside
vice president based in New York, said the SAFEbuilt investment was made
on the thesis that local or municipal governments are increasingly
turning to private companies for staffing assistance."Flexibility is a big
reason," he said. "Another is that demand, especially for smaller
communities, fluctuates pretty dramatically between the peak and trough
seasons. If the governments are using all in-house staff, it can pose a
challenge to efficient staffing, as they may have idle staff in [the]
slow season."
SAFEbuilt works with more than 200 partner communities throughout the U.S.
Mr. Resnick said the company
has expanded in geographic clusters, allowing swift and efficient
deployment of manpower as it "can pull resources from neighboring
communities if necessary to level the workload over a series of
clients."
Riverside said it would work
with SAFEbuilt's management team to enhance the company's sales and
marketing approach, allowing for faster expansion in new and existing
regions as well as deeper client relationships through both acquisitions
and organic growth.
Without giving specifics to
the geographies that SAFEbuillt is targeting for expansion, Mr. Resnick
said the company is interested in markets where there is a higher level
of growth and construction activity as well as stricter enforcement of
building codes.
"Those markets with stricter
codes are in general more receptive and can benefit more from our
service," he said. "It is a focus of the community to make sure that the
buildings and the code requirements be enforced, and it may affect
resources involved in and around the permitting process of a particular
community or municipality."
Riverside invests in business
services, consumer brands, education and training, energy, health care
and software and information technology. For buyout opportunities, it
invests in companies valued at up to $250 million.
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