Ciudad Juarez, Tijuana, and Monterrey Lead Industrial Growth in Mexico in 2023, Projecting Further Momentum in 2024

This year, the Mexican industrial real estate market is making history with a record influx of new inventory. Throughout 2023, the market is expected to expand by nearly seven million square meters, an approximate growth of 8%, including properties scheduled for delivery in the fourth quarter of the year.

However, the industrial markets experiencing the most growth in Mexico in 2023 are in the northern part of the country. This trend aligns with the increase in foreign direct investment, especially in key regions for manufacturing and distribution to the United States or central Mexico, where infrastructure is oriented towards commercial sectors focused on last-mile logistics.

According to SiiLA, Ciudad Juarez (Chihuahua), Tijuana (Baja California), and Monterrey (Nuevo Leon) are the industrial real estate markets that have grown the most in Mexico during 2023. These regions account for approximately 55% of the Gross Leasable Area (GLA) added and projected for this year.

In the first nine months of the year, these regions grew between 7% and 9%, adding nearly 2.2 million square meters to the country's industrial inventory. By the end of the year, an additional 1.5 million square meters are expected to be added, corresponding to deliveries projected for the fourth quarter.

Data indicate that Ciudad Juarez, Tijuana, and Monterrey are also characterized by their ability to attract and retain large tenants, contributing to their low vacancy rate. These regions offer unique logistical advantages, such as access to major transportation routes and proximity to international borders, making them centers for export and cross-border trade. Additionally, the industrial diversity in these regions is notable, ranging from high-tech manufacturing to light industries, which broadens the opportunities for growth and economic diversification. This dynamism in the industrial real estate sector drives local development and plays a crucial role in Mexico's economic integration with global markets, strengthening its position as a critical player in the international industry and trade arena.

Outlook 2024

Looking ahead to 2024, Monterrey is emerging as the industrial real estate market with the most projected deliveries in Mexico. In this northern region, the addition of at least 3.5 million square meters is expected. Following Monterrey, Mexico City will be the market with the most significant potential, incorporating more than two million square meters.

Outside these regions, the addition of industrial buildings is smaller but no less significant. On average, Mexico's most important industrial markets in northern, central, and Bajio regions will add 500,000 square meters each. Ciudad Juarez and Tijuana, together, will add at least 1.4 million square meters.

To date, Monterrey, Ciudad Juarez, and Tijuana represent 49% of the projected deliveries in 2024. This demonstrates their capacity to attract large-scale projects, the diversification of their industries, and their adaptability to global trends, ensuring their long-term relevance and sustainability.

With these prospects, 2024 is shaping to be a year of significant advances and sustained development for the Mexican industrial real estate market. For more information on this and other topics related to the sector, explore SiiLA REsource or contact us at contacto@siila.com.mx.