In the first quarter of this year, some industrial warehouse sales transactions in Monterrey surpassed the $1,000 per square meter mark. However, not all sales transactions reach this value. In Monterrey, and generally in the country's industrial markets, prices range from $500 to $700 per square meter.

FIBRAs, as significant players in the Monterrey industrial property market, were instrumental in the transactions of $1,000 or more recorded by SiiLA during this period. These institutional investors, with their multimillion-dollar acquisitions ranging from three to sixty million dollars per transaction, are shaping the market. Notably, FIBRA Monterrey made a substantial move by purchasing eight properties (six built and two under construction) in Apodaca, Cienega de Flores, Escobedo, and Guadalupe from Nexxus, as well as a property acquired by FIBRA Terrafina in Cienega de Flores, currently occupied by DHL.

The properties acquired by FIBRA Monterrey, with a gross leasable area (GLA) of over 186,000 square meters, are home to a diverse range of tenants from the service, auto parts, and e-commerce sectors. Notable tenants include Amloid, Forvia, and Mercado Libre. These properties are strategically located in the Nexxus ADN, Nexxus Aeropuerto, and Nexxus Escobedo Center industrial parks, further highlighting the versatility of the industrial property market in Monterrey. On the other hand, the property bought by FIBRA Terrafina in the Nexxus ADN 2 Industrial Park has a GLA of approximately 51,000 square meters.

When analyzing the purchase price by submarket, it is noteworthy that the $1,000 barrier is more common in Apodaca, where the average selling prices have been between 7% and 30% higher than those of other Monterrey submarkets over the last four years. In contrast, in Cienega de Flores, Escobedo, and Guadalupe, prices ranged between $700 and $800 per square meter during the same period. The comparative variation with transactions exceeding $1,000 reached between 25% and 45%. This indicates that some transactions, such as the one made by FIBRA Monterrey in Cienega de Flores, were priced significantly higher than market standards.

Monterrey and Its Industrial Landscape

Over the last decade, the average industrial sales price per square meter in Monterrey has increased between 15% and 20%, according to cases documented by SiiLA. This rise is partly due to the scarcity of available spaces in the market, with vacancy rates trending downwards over the last five years, reaching levels between 1% and less than 2%. Additionally, factors such as quality, location, limited access to land, and rising construction and land costs have driven up transaction values in this region of northern Mexico.

According to Alejandro Delgado, Country Manager Mexico at SiiLA, "Warehouses value per square meter in Monterrey and other markets has increased significantly. However, it is important to be cautious when making these investments, as there could be a 'bubble' due to excessive speculation about the growth in rental values and appreciation in the coming years."

In the past year, other industrial markets such as Mexico City, Ciudad Juarez, Reynosa, and Tijuana also reported transactions exceeding $1,000 per square meter. The price increase is often related to foreign investors' demand.

In the dynamic Monterrey market, where manufacturing and consumer goods companies dominate, the influence of foreign firms is significant. Companies from the United States, Asia, and Europe stand out, representing 38%, 19%, and 14% of the industrial GLA, respectively. Historically, these companies, along with investors from Latin American countries like Argentina, have been the primary contributors to the industrial growth of Nuevo Leon, where Monterrey is located.

According to data from Mexico's Economy Secretariat, in 2023, new foreign investments in Nuevo Leon reached $260 million, ranking the state sixth nationally in terms of investment attraction. This phenomenon underscores the appeal of Nuevo Leon's industrial markets, such as Monterrey, whose proximity to the U.S. border makes it a strategic enclave for companies interested in nearshoring. It is worth mentioning that Monterrey is primarily known for exporting vehicles and machinery to the United States, which receives about 90% of local exports.

For more information on the trends and performance of industrial markets in Mexico, explore SiiLA Market Analytics data or contact us at contacto@siila.com.mx.