Aire Serv Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$113,808 - $271,708
Franchise Fee
$18,000
Min Cash Required
$15,000
Total US Locations
208
Business Summary
Aire Serv franchisees operate businesses that specialize in the installation, maintenance, and repair of residential and commercial heating, ventilating, air conditioning, and indoor air quality equipment. Aire Serv also sells and services water-based heating systems and provides related products and services. Franchisees have the option to start a new business under the Aire Serv brand or convert an existing, similar business into an Aire Serv franchise.
Corporate History
The Aire Serv franchise system originated with its predecessor, Aire Serv LLC, which was incorporated in Texas in 1992. The predecessor offered Aire Serv franchises from its inception until March 2021. The current franchisor entity, Aire Serv SPV LLC, a Delaware limited liability company, was organized in November 2020. In March 2021, a securitization transaction transferred all existing U.S. franchise agreements, trademarks, and intellectual property to Aire Serv SPV LLC, making it the current franchisor. Since 1992, both the predecessor and Aire Serv SPV LLC have focused on franchising businesses that install, maintain, and repair residential and commercial heating, ventilating, air conditioning, and indoor air quality equipment, as well as selling related products and services. Aire Serv offers both startup opportunities and the option to convert existing businesses into its franchise system.
Financial Overview
Investment Range
$113,808 - $271,708
Franchise Fee (Low)
$18,000
Franchise Fee (High)
$135,000
Minimum Cash Required
$15,000
Royalty %
7%
Marketing %
2%
Equipment Costs (Low)
$5,100
Equipment Costs (High)
$25,000
Working Capital
$30,000
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
The direct parent company of Aire Serv, Neighborly Assetco LLC, has provided audited financial statements that show it is in a strong financial position. Its independent auditors have issued an unqualified opinion, meaning they found the financial statements to be presented fairly without any significant issues or concerns about the company's ability to continue as a going concern. Neighborly Assetco LLC reported net income of $159,370,000 in 2024 and $166,470,000 in 2023. The company maintains sufficient cash and is in compliance with all debt-service coverage covenants related to its securitization transactions.
Financing Details
Aire Serv may offer direct financing to qualified franchisees for a portion of the initial franchise fee, typically up to 70%, or up to 80% in certain cases. The interest rate varies based on the franchisee's credit score, ranging from 9% for scores 700+ to 12% for scores under 600. Repayment terms are negotiable but generally range from up to 5 years for loans less than $45,000 to 9 years for loans over $150,000. Franchisees must sign a promissory note and grant Aire Serv a security interest in all business assets. Personal guarantees, including from spouses if required, are also mandatory. Aire Serv does not provide financing in transactions involving brokers. Additionally, Aire Serv may offer financing for a portion of the renewal fee at a 12% interest rate under limited circumstances for qualified franchisees.
Performance Metrics
Total US Locations
208
Franchised Units
208
Corporate Units
0
Avg Square Footage
2,000
Franchising Since
1992
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
Yes
Litigation Count
6
Litigation Summary
Aire Serv itself has no direct litigation history, but its affiliates have been involved in administrative orders. For instance, a predecessor to an Aire Serv affiliate, Window Genie, and its then-president resolved an issue in 2017 with the California Commissioner of Business Oversight regarding unsubmitted advertisements. Similarly, an Aire Serv affiliate, Molly Maid, settled a case with the State of Kansas in 2010 concerning consumer protection. More recently, in fiscal year 2024, Aire Serv SPV LLC initiated four lawsuits against its franchisees. One of these cases is a suit to collect outstanding amounts, while the other three are aimed at enforcing covenants not to compete. All these recent cases were filed in McLennan County, Texas.
Bankruptcy History
Aire Serv itself has no bankruptcy history to report. However, several portfolio companies controlled by Aire Serv's indirect parent, Kohlberg Kravis Roberts & Co. L.P. (KKR), have undergone bankruptcy or insolvency proceedings. These include The Collected Group LLC, a fashion brand owner, which filed for Chapter 11 reorganization in April 2021 and emerged in May 2021. Envision Healthcare Corporation, a healthcare provider, filed for Chapter 11 reorganization in May 2023 and emerged in November 2023. Genesis Care Pty Limited, another healthcare provider, filed for Chapter 11 reorganization in June 2023 and emerged in February 2024. IPI Legacy Liquidation Co., a pharmaceutical company, filed for Chapter 11 reorganization in December 2023 and emerged in April 2024. Lastly, Café Coffee Day, a retail cafe operator in India, filed an insolvency resolution in August 2024, though this order was set aside in February 2025.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their Aire Serv franchise, franchisees must provide written notice between 180 and 240 days before their current agreement expires. They must not be in default of their existing franchise agreement or any related agreements, must have fulfilled all monetary and other significant obligations on time, be in good standing, and have received no more than two written notices of default during the term. Additionally, franchisees cannot have failed to meet the Minimum Performance Standards for more than two calendar years or measurement periods. As part of the renewal process, franchisees and their guarantors are required to sign a general release of claims, pay a $5,000 renewal fee, complete Aire Serv's current training requirements, and sign the then-current version of the franchise agreement, which may contain different terms, conditions, and fees.
Training & Support Program
Franchisor Assistance
Aire Serv provides extensive support to its franchisees. Before opening, franchisees receive site selection guidelines, lists of approved supplies, access to detailed operations manuals, and comprehensive training programs. Aire Serv also offers opening support and additional assistance as needed. Ongoing assistance includes maintaining the Marketing, Advertising, and Promotion Fund (MAP Fund), updating approved suppliers and products, and conducting research and development for new offerings. Aire Serv also provides periodic business visits for consultation, offers refresher training courses and requires attendance at regional meetings and annual conventions. Franchisees receive continuous communication and support, alongside regular updates to the Operations Manual. Additionally, Aire Serv requires participation in its Call Center Program for handling rollover and after-hours customer calls, processing service requests, and scheduling estimates.
Initial Training Hours
167
Training Location
Primarily at Aire Serv offices in Waco, Texas, or via webinar/video conferencing. Field training also occurs at designated existing franchised businesses.
Ongoing Support
Aire Serv provides its franchisees with ongoing assistance, including periodic visits to their business for consultation and guidance, as deemed necessary by the franchisor. Franchisees are required to attend refresher training courses, regional meetings, and annual conventions. Aire Serv also offers continuous communication and support, alongside regular updates to the Operations Manual. Additionally, franchisees must participate in Aire Serv's Call Center Program for handling customer service requests and scheduling appointments.
Franchise Requirements
Ideal Candidate Profile
Aire Serv seeks franchisees who are either individuals committed to directly performing or supervising the business full-time, or, for entities, a designated principal owner overseeing operations. Ideal candidates may already possess an HVAC license or own an existing business offering similar services, for which Aire Serv offers initial franchise fee discounts. The franchise also encourages experienced employees from its own or affiliate systems, suggesting a preference for individuals with proven dedication and relevant operational knowledge.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Hybrid
Owner Participation
Hands-On
Territory Type
Protected
Territory Size Requirements
Aire Serv territories are generally defined by population size, with a minimum of 100,000 and a typical maximum of 300,000 people. Larger populations may be allowed in certain situations, such as densely populated urban areas. Franchisees pay an initial fee for a territory of up to 100,000 people, and an additional $450 for every 1,000 people beyond that minimum. Aire Serv franchisees retain their territorial rights even if the population within their assigned area increases over time.
Staffing Notes
Aire Serv franchisees are responsible for hiring a sufficient number of competent and trained employees to provide efficient customer service. Franchisees must ensure all employees and subcontractors who enter a customer's home have passed required background checks. Aire Serv emphasizes that franchisees are solely responsible for all employment-related matters, including hiring, discharging, wages, benefits, and ensuring adequate training for their workers. Aire Serv is not considered a joint employer with its franchisees.