Trends in Mexico’s commercial and industrial property markets

In The market for commercial and industrial real estate in Mexico, we looked at a recent snapshot of the industrial real estate market in the last quarter of 2013, and saw how cities in the Bajío Region were outpacing cities in Central Mexico or Northern Mexico. (The snapshot came from the report ‘Industrial Markets in México (Q4 2013)‘ by Jones Lang LaSalle, a global real estate services firm.)

In this post, we take a look at the “Industrial Property Clock” for the same period, from the same report.

In general, cities in Central Mexico and in the Bajío are well “ahead” of cities in northern Mexico on this clock. The analysis by Jones Lang LaSalle suggests that the commercial and industrial property markets in Mexico City, Guanajuato, Guadalajara, San Luis Potosí, Puebla and Toluca are “peaking”. The two remaining cities in the Bahío (Querétaro and Aguascalientes) are joined by several cities in northern Mexico in the “rising market” portion of the graph, while Reynosa, Matamoros, Nuevo Laredo and Chihuahua are anchored in the “bottoming market” portion.

The following quotes are taken from the report:

• Mexico City’s industrial market grows its footprint annually; rents have grown to pre-crisis levels

• Puebla market is very tight; land is scarce and vacancy is at a low

• Toluca market has been growing as an alternative to Mexico City, it is also attracting local businesses

• Guanajuato is growing in several submarkets like Silao and Celaya thanks to car manufacturing and food related businesses

• Guadalajara keeps occupying space and growing at El Salto and South Periférico

• San Luis Potosí keeps attracting new industries related to consumer goods. The car manufacturing industry is taking advantage of the city’s communications and infrastructure

•Querétaro has been active inaugurating new developments near the airport both for the aerospace business and for car manufacturing. These industries have taken advantage of the local educated labor force

• Aguascalientes seems to be the new frontier for developers: at least three major national developers have inaugurated parks in this market, one of them is Nissan’s supplier park

• Tijuana continues its path towards quickly becoming a speculative development marketplace once again. It is the first border city to regain this business climate

• Nogales, the smallest of the Northwest Border region cities, is also enjoying the expansion of Kimberly Clark (KCI) leasing vacant space within the Nuevo Nogales Industrial Park

• Ciudad Juárez keeps lowering the existing vacancy rate

• Monterrey submarkets have been improving, especially Apodaca and Santa Catarina, where land prices and rents are growing

• Nuevo Laredo, Reynosa and Matamoros have seen a slow down in their activities, however, tenants have stayed at their buildings; there are no new developments on the horizon and vacancy rates are around 10%

Related posts:

• The market for commercial and industrial real estate in Mexico
• Santa Fe, case study of real estate development on periphery of Mexico City
• The geography of Mexico City: index page
• The growth of the city of Monterrey, Mexico’s industrial powerhouse
• Mexico’s growing industrial might
• The city of Querétaro is becoming Mexico’s aeronautical manufacturing center
• Plans to improve the Mexico City-Toluca transport corridor