BTS vs. BTO: Why Is Most of Mexico’s Industrial Market Based on Leasing?

At the entrance of the Marabis Castro del Río Industrial Park in Guanajuato, the sun reflects off a metal sign with red letters reading, “We Offer Buildings for Lease (BTS) and for Sale (BTO).” But behind these seemingly simple acronyms lie two business models that define the terms of industrial space occupancy and how a company manages risk, liquidity, and long-term operational control.

BTS (Build-to-Suit) projects are custom-built according to tenant specifications explicitly designed for leasing. The property remains in the hands of the developer, although in some cases, agreements may include purchase options or be sold later under separate agreements. In contrast, BTO (Build-to-Own) developments are also designed to meet the company’s requirements, but with the fundamental difference that the company owns the asset from the outset, assuming the investment and real estate risk in exchange for full control.

At a national level, BTS properties are prevalent. According to SiiLA Market Analytics, nearly three-quarters of new industrial inventory enters the market with pre-lease agreements, many of them BTS. In contrast, BTO properties are far less common.

This is no coincidence. The market structure responds to economic and strategic factors that have cemented leasing as the dominant model.

Between 2020 and 2024, more than 2,000 companies—both new and existing—absorbed nearly 33 million square meters of industrial space across Mexico’s northern, central, and Bajío regions, according to SiiLA. These transactions do not necessarily indicate market growth but rather reflect high activity levels in a market where the vast majority of deals are lease agreements.

Key factors behind this trend include global manufacturing expansion, with companies relocating production to Mexico to reduce logistical risks and ensure operational continuity without the burden of owning real estate.

Additionally, e-commerce has fueled unprecedented demand for distribution centers in strategic locations with immediate availability. This is further supported by infrastructure, competitive costs, and a skilled workforce, which concentrate investment in highly connected areas where land for industrial development is limited. As a result, leasing has become the most viable option for most companies.

However, the turning point is not only operational but also financial. Purchasing industrial buildings ties up capital, an option many companies prefer to avoid—especially in a market where leasing in U.S. dollars provides flexibility, scalability, and immediate access to ready-to-use spaces without long-term commitments.