Over the past year, an investment wave poured into Mexico's major industrial markets, attracting at least 236 national and foreign companies. According to SiiLA, 60% of these firms established themselves in the country's Northern region, highlighting the growing trend of nearshoring and the significance of cross-border trade between Mexico and the United States. This shift is reshaping the Mexican manufacturing landscape and positioning the country as a key player in global supply chains.

The investment wave companies opted for high-quality spaces, primarily of substantial size (over 5,000 m²). Data from SiiLA Market Analytics reveals that 70% of the industrial warehouses occupied by these companies were Class A, with gross leasable areas ranging from over 300 m² to more than 100,000 m². However, the average industrial warehouse size was 8,000 m².
Overall, the preference for large, high-quality industrial spaces suggests that these companies operate on a significant scale and have plans for growth and expansion, with a business model focused on enhancing efficiency and productivity in their commercial processes.

Among the notable large-scale warehouses that were inaugurated this year, two stand out: AGP Glass, a German supplier to Tesla that invested 800 million dollars in its 100,000 m² facility in Nuevo Leon, and Canadian industrial equipment manufacturer Skyjack, which invested 80 million dollars in its new 61,000 m² factory in Coahuila.

It is worth noting that 46% of the 236 companies venturing into new markets are of Mexican origin. The majority (33%) belong to the transportation, logistics, food, beverage, and tobacco industries. The rest are foreign companies, mainly from the United States (39%) and China (12%), primarily focused on the automotive, manufacturing, and capital goods sectors.

The Investment Path

Mexico is attractive as a hub for quality production at competitive costs and a strategic location for distribution to the world's leading consumer market, the United States, and one of the most significant developing commercial regions, Latin America. For that reason, it's unsurprising, albeit impressive, that 51% of the 236 companies entering new markets between 2022 and 2023 are from the automotive, manufacturing, services, transportation, and logistics sectors, as well as that many of them chose to settle in the Northern (60%), Bajio (26%), and Central (14%) regions of Mexico.

SiiLA's data reveals that these companies' most prominent industrial real estate markets were Monterrey, Mexico City, Tijuana, and Saltillo. These cities have experienced significant growth in their industrial infrastructure over the last five years, either due to their importance as last-mile consumer markets or their strategic locations, offering greater flexibility and agility in supply chains.

The fact that numerous domestic and foreign companies are expanding industrial markets in Mexico signals positive economic and commercial development for the country. However, it also presents challenges, such as the need to maintain a nationwide favorable business environment and promote innovation and competitiveness to ensure the continuous success of these commercial operations.

For more information about Mexico's and Latin America's industrial sector's market overview and trends, explore SiiLA REsource or contact us at contacto@siila.com.mx.