Faced with a growing demand for industrial shipsespecially in strategic areas of the country due to the effects of nearshoring and of the Logistic chainthe possession of well-located land, especially in the northern border of the country, has become a decisive element for the development of industrial spaces, especially by Chinese companies seeking to land their operation in the country.
For specialists and entrepreneurs real estateland reserves will be vital to be competitive in the supply of industrial spaces.
Gonzalo Robina, Deputy General Director of Fibra Uno (FUNO), pointed out that there is an increase in demand by light manufacturing companies, especially in the markets of Tijuana and Ciudad Juárez, which register record occupancies, above 99 percent.
“There is much more demand than supply, therefore, prices are also going up,” explained Robina.
Only in the case of FUNOthat, according to its financial results for the first quarter of 2022, its income in industrial properties increased 7%, to reach 6,928.5 million pesos, while their monthly rental prices per square meter grew 8.7 percent.
José Carlos Alemán, general director of the firm Buzz Street, commented that, in the first quarter of 2022, of almost 30 million square feet under construction in 13 markets in the country, half is already pre-leased.
“For Reynosa and Juárez in particular, about 85% of the gross leasable area under construction already had leases signed prior to delivery”, stated the specialist in a report.
Nearshoring, the advantage for global companies
For the director of FUNO among the elements that have brought to historical levels the demand for industrial space there is nearshoring or geographical proximity to serve the industrial chain with the United States, as well as the need for Chinese companies to serve the US market from Mexico.
“Some or several of the global companies that had been set up in Mexico until the year 2000 or 2005, approximately, that migrated to China, are already coming back requesting spaces in Mexico,” said Robina.
Another industry player, Fiber Prologisfocused only on lease from industrial ships class A, also considered that being located in a key area for the supply chain is fundamental for the results of occupation and income.
“Manufacturing and logistics continue to drive demand for space. Fundamental changes, such as the nearshoringare strengthened in the first months of 2022 in the border markets and the bottlenecks in the ongoing supply chain are posed to trigger a greater demand for space”, explained Luis Gutiérrez, president for Latin America of Prologis.
According to the results presented to investors, in the first three months of this year, Prologis’ border markets registered an occupation above 98%, with 66.3% of its revenues denominated in US dollars and the rest, in Mexican pesos.
“We expect further rental growth in our markets supported by supply barriers and strong demand. Higher rents reflect increases in replacement costs and on the other hand, tenants must act quickly to secure the space before going on the market, ”the Prologis representative detailed in his financial report.
The advantage of owning the land
Although, the industrial markets Located in the northern part of the country, they register a high demand for space and historically low vacancies, as well as a lack of land to develop, which is not the case in the entire country.
Jorge Pigeon, director of Capital Markets at FUNO, explained that, although the northern border suffers from a lack of space, just as the Valley of Mexico has vacant landbut already with development plans, the effect is different in areas like the Bajío, where there are industrial parks free and room to build.
For this reason, he considered that for cases such as FUNO’s, having well-located land reserves is an advantage over competitors.
“The shareholders that founded the company have been investing in land, so they somehow have land reserves with which FUNO could believe in the future,” he explained.
“It is a great advantage, because in particular in logistics there is not much land available, what there is is already in the hands of certain people,” Pigeon pointed out.