FIBRA Prologis Expands in Reynosa with a Strategic Investment of $26.9 Million

FIBRA Prologis has purchased an industrial warehouse from Prologis in Reynosa, Tamaulipas, for $26.9 million, including closing costs. This acquisition was financed with cash from recent capital raises, and according to the real estate investment trust (REIT or FIBRA), the facility is fully leased in dollars to a Prologis client currently expanding its operations.

According to SiiLA, the transaction includes Building 30 at the Villa Florida Industrial Park in the Oeste submarket of Reynosa. With over 25,000 square meters of gross leasable area (GLA), this property is currently occupied by the American water treatment company Pentair. The facility is a build-to-suit project that was delivered at the end of last year.

It's worth noting that FIBRA Prologis specializes in acquiring and leasing logistics and manufacturing facilities in Mexico. Its primary source of properties is Prologis, a developer and operator of industrial assets that also acts as its sponsor. Additionally, the REIT acquires properties from third parties with the approval of its Technical Committee.

In the past year, FIBRA Prologis' portfolio grew from 225 to 236 properties across six industrial markets in Mexico. Collectively, these properties have a GLA of approximately 4.4 million square meters.

The recent transaction in Reynosa comes almost three months after FIBRA Prologis announced the acquisition of the "Vallejo DC #4" industrial facility in the Azcapotzalco borough of Mexico City. The 4,700-square-meter GLA property was acquired for $5.9 million. These strategic acquisitions are part of the trust's expansion in key industrial areas. In the suburban area of the Valley of Mexico, FIBRA Prologis invested over $35.1 million to acquire four Class B industrial facilities in Vallejo between 2021 and 2022.

Reynosa: A Strategic Hub of Industrial Development

To date, Reynosa accounts for about 11% of FIBRA Prologis' industrial GLA and generates 10% of its rental income. However, in the past year, the company's income in the manufacturing region has decreased by 2%. This decrease can be attributed to a slight increase in property vacancies in Reynosa, which currently has an occupancy rate of 99.8%, according to trust data analyzed by SiiLA.

Despite these minor setbacks, the performance of the company's properties in Reynosa remains stable, providing a reassuring outlook for the future. Significant growth is anticipated in the coming years, with nearly 16% of FIBRA Prologis' project pipeline under development in this market. This includes the delivery of approximately 56,000 square meters, representing an 11.5% portfolio growth in Reynosa.

Furthermore, about 15% of Prologis' developable land is concentrated in Reynosa, making it the fourth of six regions with the highest potential for expansion. It surpasses the industrial markets of Ciudad Juárez (9%) and Tijuana (7%) and is only behind Mexico City (19%), Guadalajara (18%), and Monterrey (32%).

Overall, the development potential in Reynosa is significant, amounting to more than 167,200 square meters of buildable space. Along with the pipeline, this could increase FIBRA Prologis' presence in the region by more than 46%. This expansion would mean more specialized industrial centers near the Mexico-US border in critical sectors, such as automotive, electronics, medical, and aerospace, offering a promising outlook for future growth.

The expansion of FIBRA Prologis underscores Reynosa's strategic importance in Mexico's industrial landscape, highlighting its role as a development hub for various industrial sectors. To learn more about the performance of this and other real estate markets, explore SiiLA REsource or contact us at contacto@siila.com.mx.