In 2024, 163 Companies Vacated 1.3 Million Square Meters of Industrial Space in Mexico: Crisis or Market Reconfiguration?
- The vacating of over one million square meters of industrial space in 2024, driven by the decisions of more than 160 companies, could be seen as a sign of pressure on the sector. However, it also reflects the market’s ability to reconfigure itself, guided by the strategies of industries like logistics and technology, in an environment of sustained demand.
- These numbers reveal complex dynamics where some spaces quickly reintegrate into the market while others face greater challenges in adapting to the changing needs of a sector that increasingly values specialization and operational flexibility.
In the first nine months of 2024, 1.3 million square meters of industrial space were vacated in Mexico. However, rather than a cause for alarm, this reflects temporary challenges some properties face amid shifting demand trends, especially considering absorption volume during the same period was four times higher, and currently, only 40% of the vacated spaces from 2024 remain partially or fully available.
The departure of 163 companies was the main driver of this vacancy. Of these, 12 relocated within the same industrial park or area to optimize operations, and 9 shifted to other markets. The majority, 142 companies, vacated spaces without immediately occupying new ones. These moves stem from various business strategies, ranging from portfolio adjustments to short-term lease expirations.
Half of the spaces vacated in 2024 that remain available are entirely vacant, while the rest have vacancy rates ranging from 10% to 90%. This variation highlights key differences in industrial spaces' location, size, and class.
Many spaces with less than 20% vacancy rate are concentrated in the Mexico City metropolitan area, exhibiting diversity in size and class. Those with vacancies between 20% and 50% are predominantly Class B, averaging 3,500 to 4,000 square meters, and are mainly found in the Bajío and Tijuana regions. Spaces with vacancy rates exceeding 50% but below 100% are also mostly Class B, with an average size of 5,500 square meters, concentrated in the northeast, particularly in Reynosa, Tamaulipas.
Finally, fully vacant spaces, mostly Class A with an average size of 8,000 square meters, are prominently located in Tijuana and Ciudad Juárez, which account for nearly half of these properties. The rest are distributed across the Mexico City metropolitan area, Monterrey, and Reynosa. These figures reflect regional patterns in absorption and availability dynamics, influenced by property quality and each market's economic and logistical specifics. This occurs in a context where, so far in 2024, average absorption rates—i.e., demand—have reached 12,000 square meters per transaction.
The Sectors Behind the Vacancy
In general, four out of ten spaces were vacated by logistics, capital goods, and automotive companies, reflecting the inherent mobility of these sectors. However, industries such as electronics, technology, and business services also played a significant role, accounting for two out of ten vacancies.
According to SiiLA data, the largest vacated space recorded by September 2024 exceeds 76,000 square meters and is located in Huehuetoca, Hidalgo, where an electronics company vacated the facility mid-year. In contrast, the smallest vacated space measures less than 200 square meters and is in the Montenegro Industrial Park in Jalisco, where an electronics company returned the property earlier this year. Currently, both spaces are fully occupied, reflecting the strong competitiveness and demand that define Mexico's industrial market.
These dynamics reveal broad patterns of vacancy and absorption but also uncover a more nuanced reality: not all properties face vacancy challenges equally. While some, particularly Class A spaces in strategic locations, are quickly reoccupied, others contend with persistent vacancy issues due to factors like location, size, or class.
Today, the features that truly add value to industrial properties go beyond location; they include sustainability, technology, infrastructure quality, accessibility, and flexibility in both space design and lease terms. However, the real strategic edge lies in understanding how these attributes meet the specific needs of industries or clients. Identifying those niches and aligning properties with their demands enhances their appeal and profitability and positions them as key assets in a market increasingly driven by innovation and adaptability.
Want to learn more about the dynamics of the industrial market and how to identify key investment opportunities? Visit SiiLA Market Analytics or contact us at contacto@siila.com.mx.
