FIBRA Prologis Expands in Mexico with the Acquisition of an Industrial Park in Monterrey for 32.7 Million Dollars

FIBRA Prologis, a leading player in Mexico's Class A industrial real estate sector, has acquired an industrial park in Monterrey, Nuevo Leon. This park comprises three buildings and a piece of land. With a total investment valued at $32.7 million, including closing costs, the real estate trust has added approximately 40,800 square meters of industrial space to its property portfolio, fully leased in U.S. dollars.

This strategic acquisition underscores FIBRA Prologis' commitment to continue its growth and capitalize on the trend of business relocation and expansion in Mexico, known as "nearshoring," to deliver value to its shareholders' investments.

As of September this year, approximately 14% of the trust's Gross Leasable Area (GLA) was in Monterrey. Between the third quarter of 2023 and 2020, FIBRA Prologis' GLA in Monterrey increased by approximately 41%, rising from nearly 409,000 to about 576,000 square meters, according to data from FIBRA Prologis analyzed by SiiLA.

During this period, the growth of FIBRA Prologis' portfolio in Monterrey was the second most pronounced after Tijuana, which saw a 57% increase. It's worth noting that over the past three years, the trust has strengthened its presence in the northern and central regions of Mexico, with a particular focus on areas such as Tijuana, Monterrey, and Ciudad Juarez, while maintaining its portfolio in the Bajio region, specifically in Guadalajara, Jalisco.

The performance of this real estate trust's portfolio is closely tied to the performance of regions that generate the highest income for the company. During the third quarter of 2023, FIBRA Prologis' industrial portfolio in the Greater Mexico City metropolitan area generated the highest proportional income, at around 368 pesos (around 20 U.S. dollars) per square meter. Tijuana followed with 325 pesos, and Monterrey with 315 pesos. These markets were followed by Reynosa, with 313 pesos; Guadalajara, with 306 pesos; and Ciudad Juarez, with 281 pesos.

In this context, FIBRA Prologis has reported that nearly 67% of its effective rental income comes from global logistics markets such as Mexico City, Guadalajara, and Monterrey, which are highly industrialized and consumption-oriented regions. These markets benefit from their proximity to Mexico's major highways, airports, and railway centers, driving the development of densely populated areas and generating sustained growth of the middle class.

The rest of FIBRA Prologis' effective rental income comes from regional manufacturing markets, including Ciudad Juarez, Tijuana, and Reynosa. These markets are characterized by the presence of industrial facilities for the automotive, electronics, medical, and aerospace industries, among others. These markets benefit from a skilled workforce and proximity to the U.S. border.

FIBRA Prologis' acquisition of the industrial park in Monterrey is a sign of confidence in the Mexican industrial sector. The company is well-positioned to capitalize on growth trends driving the demand for industrial spaces in the country, such as nearshoring, the expansion of e-commerce, and the increasing demand for manufacturing.

For more information on the performance of this and other REITs in Mexico, explore SiiLA REsource or contact us at contacto@siila.com.mx.