Amazon Web Services (AWS), Amazon's cloud services division, will make a record investment of $5 billion in Mexico to establish a new data center region in Queretaro. This project, ready by early 2025, will consist of three availability zones, each with one or more data centers, offering 240 company services. The new facilities will add to AWS's two data center regions in Jalisco and Nuevo Leon.

With the new infrastructure in Queretaro, AWS customers can leverage advanced technology and securely store data. It's important to note that an "availability zone" is a location with one or more data centers. These zones are isolated for increased security and stability, ensuring that cloud services continue operating even in the event of technical failures or natural disasters.

The investment, which will be spread over 15 years, responds to customer demand and factors such as low latency, the absence of seismic activity, and flood risks in Queretaro, as well as business opportunities, in a context of national economic growth and increased demand for cloud services due to nearshoring to Mexico.

The new data center region will boost the development of both emerging and established companies. AWS has significant clients in the country, such as Aeromexico, BBVA, Banco Santander, Cinepolis, and Kavak. The list of potential clients could increase considerably in the short and medium term, considering that, according to the American company, it is expected that by 2028, 98% of companies will use generative artificial intelligence, a field in which AWS plays an important role. AWS offers cloud services such as data analysis, artificial intelligence, data processing, databases, Internet of Things, machine learning, mobile services, and information storage. These tools are essential for companies and developers creating and managing online applications and services.

Amazon, AWS, and the Commercial Real Estate Market in Mexico

AWS's expansion strengthens Amazon's presence in Mexico, which already operates in 20 of the country's 32 states. According to data from SiiLA, the industrial area occupied by the consumer goods giant increased by 9% in the last year, reaching close to 600,000 square meters nationwide.

Since 2020, Amazon has invested in Mexico's cloud technologies through AWS. That year, Jeff Bezos's company launched seven Amazon CloudFront locations, a content delivery network that accelerates data processing, videos, applications, and programming connections to users worldwide with low latency and high transfer speeds. Also, Amazon introduced AWS Outposts in Mexico, a service allowing users to extend AWS infrastructure and services to their facilities or local data centers. Essentially, AWS Outposts brings AWS cloud technology directly to the user's location, allowing for a closer integration between cloud resources and local resources.

Two years later, in 2023, AWS expanded its infrastructure in the country by inaugurating AWS Local Zones in Queretaro, bringing services such as computing, storage, and databases closer to urban and industrial centers and facilitating low-latency applications for users. It also established an AWS Direct Connect connection in Queretaro, allowing customers a private connection between AWS and their facilities.

In a context where Mexico aspires to become one of the world's top ten economic powers and one of the leading destinations for capital placement, AWS's investment in Queretaro and its expansion in the country are positive signals for the commercial real estate market, as the demand for space for data centers and other technology-related facilities is increasing, driven by the growth of e-commerce, the digitalization of companies, and the need for infrastructure to support cloud services and emerging technologies.

The presence of AWS and other tech giants in Mexico not only stimulates the development of industrial and commercial parks but also attracts other companies and service providers looking to be close to these innovation centers. This can generate a multiplier effect, boosting job creation, infrastructure development, and overall economic growth. Moreover, it positions Mexico as an attractive destination for nearshoring. It strengthens its role as a strategic center for innovation and business development in Latin America, further boosting the commercial real estate market.

For more information on this and other commercial real estate market topics, explore SiiLA REsource or write to us at contacto@siila.com.mx.