Faria Lima vs. Polanco: Parallels and Contrasts of Two Latin American Business Powerhouses

Polanco in Mexico and Faria Lima in Brazil are pivotal business hubs driving their respective countries' economies.

These regions are known for their extensive office space development. They strongly demand properties in densely populated areas where significant financial, insurance, real estate, and legal corporations hold substantial presence.

Polanco is a region with a significant presence of FIRE tenants. Photo: Canva.

By: SiiLA News

11/21/2023

The most important economic hubs in major cities, also known as Central Business Districts (CBDs), including Lower Manhattan in New York, Lujiazui in Shanghai, and West End in London, play a crucial role in developing their respective countries' economic ecosystems. In Latin America, it's no different. Regions like Faria Lima in São Paulo, Brazil, and Polanco in Mexico City, Mexico, are significant commercial and corporate areas.

Polanco, one of Mexico's most affluent areas, stands out not only for its corporate presence but also for its distinguished businesses and Hispano-American neo-colonial architecture. On the other hand, Faria Lima, developed around its namesake avenue, serves as Brazil's corporate backbone, hosting important offices and even the country's first mall, Shopping Iguatemi, established in 1966.

Polanco and Faria Lima have a significant presence of Finance, Insurance, Real Estate, and Legal (FIRE) tenants. In Polanco, this group of companies occupies over 30% of office space, while in Brazil, their presence is even more substantial, accounting for just over 47%, according to data from SiiLA Market Analytics.

Despite their similarities, the office sectors in these regions differ in size and occupancy. Faria Lima has a vacancy rate of 6.2%, while in Polanco, it is 17.3%. Furthermore, Polanco's office sector is larger than that of Faria Lima. The former boasts a Gross Leasable Area (GLA) of nearly 1.5 million square meters of Class A+, A, and B properties, while the latter covers about 762,000 square meters.

Properties and FIRE Tenants in Polanco and Faria Lima

Birman 32, Faria Lima 3500 and Mariano Escobedo 303.

Among the FIRE tenants in Polanco, financial companies dominate occupancy. Therefore, it's no surprise that BBVA Mexico is the FIRE tenant with the most occupied space in this region. The bank occupies the Mariano Escobedo 303 building, with a GLA of over 70,300 square meters. A similar situation exists with Itaú Bank in Faria Lima, which leads the occupancy of FIRE companies, occupying significant properties like Faria Lima 3500 and Faria Lima Financial Center.

These tenants stand out in regions characterized by their commercial, economic, and real estate vitality, where certain buildings, due to their architecture, design, location, or historical context, have left a lasting mark in the collective imagination. For example, Birmann 32 in Faria Lima, colloquially known as the "whale building," houses important companies like Facebook and Shopee. In Polanco, Plaza Carso is home to the Soumaya Museum and the offices of Telcel and Totvs in Mexico.

It's worth noting that both Faria Lima and Polanco have important FIRE tenants and considerable population density.

Faria Lima receives around 145,000 people or "Faria-Limers" daily and is home to five of Brazil's top ten companies, with a combined value of over 880 billion reais (approximately 181 billion dollars). On the other hand, over 65,000 people work in Polanco, with approximately 28,000 residents. This region accounts for about 14% of Mexico's corporate GLA.

In general, Faria Lima and Polanco are standout examples of Central Business Districts in Latin America, driven not only by significant FIRE tenants but also by influential companies and businesses that make significant contributions to their respective countries' economic development and identity.

For more information on office market trends in Mexico and Latin America, explore SiiLA REsource or contact us at contacto@siila.com.mx.

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