Construction of Las Plazas II Industrial Park: A Reflection of Strategic Investments for Manufacturing and Logistics in the State of Mexico

Construye Industrial is strengthening the logistics infrastructure of the Greater Mexico City Area by constructing its Las Plazas II industrial park in Ocoyoacac. It anticipates the delivery of the "L1" industrial facility in July 2024.

Ocoyoacac is a municipality in the State of Mexico, approximately 15 kilometers from Toluca and 10 kilometers from Lerma. It is distinguished by its growing importance as an industrial investment center, especially in highly specialized sectors such as biotechnology, non-cellular plates and sheet manufacture, and therapeutic drugs. Its strategic location makes it a key point for logistics and distribution in the central region of Mexico.

Alejandro Kahan from Construye Industrial at the construction site of Las Plazas II. Photo: SiiLA.

By: SiiLA News

05/03/2024

On Thursday, May 2, 2024, the SiiLA team had the privilege of visiting the construction site of the strategically located "L1" industrial facility at the Las Plazas II industrial park. This property, with its impressive 17,500 square meters of gross leasable area (GLA), is a testament to the forward-thinking development by Construye Industrial in Ocoyoacac, State of Mexico. The facility, designed to be divided into several modules, is a speculative project that is set to be completed by July 2024, marking the beginning of an ambitious plan that includes eight facilities.

During the visit, Alejandro Delgado, SiiLA's Country Manager in Mexico, spoke with Alejandro Kahan, Commercial Coordinator at Construye Industrial.

According to Kahan, Las Plazas II is an industrial complex with a strategic location that caters to the growing demand for logistics and distribution services in the Greater Mexico City Area (ZCVM), including Toluca, Lerma, and surrounding areas. The executive highlighted that this development will bolster the region's infrastructure for both light and heavy manufacturing and meet the central region's storage needs.

It is worth noting that Ocoyoacac is located approximately 15 kilometers from Toluca and about 10 kilometers from Lerma. According to data from SiiLA Market Analytics, the Toluca-Lerma industrial submarket inventory has experienced moderate growth of 3% over the last year. Despite a temporary slowdown in demand since mid-2023, the submarket has seen significant absorption spikes since 2020. This, coupled with tenant retention and despite the delivery of new inventory, has maintained a downward trend in vacancy rates, averaging near 2.3% in the first quarter of 2024, indicating a promising future for investors.

Strategic Investments

Alejandro Delgado (left) interviews Alejandro Kahan in Las Plazas II. Video: SiiLA.

The expansion from Toluca-Lerma towards the northeast, heading towards the Ocoyoacac area, has driven the demand for regions with industrial development potential towards Mexico City, like Ocoyoacac, which is closer to the country's capital. In this sense, it is no surprise that Ocoyoacac is emerging as a key investment center.

According to the Mexican Economy Secretariat, over the past 24 years, foreign direct investment (FDI) in this locale has been on the rise, nearly tripling investment inflows. However, in 2023, when investments totaled 1.9 billion dollars, only 6% were new investments. The remainder was distributed among inter-company accounts (11%) and reinvestment of earnings (83%). This suggests that while Ocoyoacac continues to attract investors, most foreign capital is more oriented toward expanding existing operations rather than launching new projects.

This investment interest is partly due to the profile of companies based in Ocoyoacac, which is recognized as a local exporter of biotechnological products, non-cellular plates and sheets, and therapeutic drugs. These highly specialized sectors make the region attractive for investment and technological development.

The industrial diversity of Ocoyoacac complements and expands the offerings of the Toluca-Lerma submarket, which attracts manufacturing companies, particularly from the automotive, food, and personal products sectors, collectively representing 53% of the region's industrial GLA, in addition to 6% allocated to transportation and logistics, according to SiiLA data.

In a context where the Toluca-Lerma submarket is distinguished by its focus on manufacturing, accounting for 40% of its industrial activity compared to 19% in the rest of the Greater Mexico City area, the trajectory of Construye Industrial highlights its decisive role nationally.

Since its inception four decades ago in Toluca, Construye Industrial has demonstrated unwavering growth, a testament to its adaptability and resilience in the ever-evolving manufacturing sector. This growth is evident in the expansion of its operations, marked by the establishment of its first industrial park in Queretaro in 2014. Presently, the company is in the process of developing its fourth park in Queretaro, spanning approximately 800,000 square meters. With a total of 14 industrial parks constructed and under construction across Mexico, Construye Industrial solidifies its position as a key contributor to the development of manufacturing infrastructure, fueling economic and productive growth in the heart of the country.

For more information about this and other projects in Mexico's industrial real estate market, visit SiiLA REsource or contact us at contacto@siila.com.mx.

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