Mercado Libre, the largest Latin American e-commerce platform, recently announced that in October 2024, it will open a new Distribution Center (CEDIS) in the Leon Bajio Industrial Park (PILBA) in Guanajuato. The expansion announcement comes in the context of a booming e-commerce sector in Mexico, which has driven the expansion of companies dedicated to commercializing consumer goods, especially in the northern and central regions of Mexico.

According to SiiLA, PILBA closed 2023 with an occupancy rate close to 93% and vacant and under-construction warehouses ranging from 17,500 to 35,000 square meters. The properties share infrastructure with other industrial warehouses, occupied mainly by automotive and capital goods companies like MPE Plastics, as well as direct competitors of Mercado Libre, such as Amazon. So far, it is known that part of the company's new facilities have already been built, and the expansion is under construction.

The new CEDIS will boost logistics operations and improve efficiency in the distribution of products to the end users of the Argentine-origin company, which seeks to improve its delivery times and the shopping experience of its users. This strategic move is crucial to maintaining its leadership in the competitive e-commerce sector. Additionally, it reinforces Mercado Libre's presence in the Mexican market and highlights the importance of consumer goods in the country's economic development and the modernization of industrial infrastructure.

Data from SiiLA Market Analytics indicate that, compared to its direct competitors, Mercado Libre is the consumer goods and e-commerce company with the most occupied space. It has around 700,000 square meters of industrial Gross Leasable Area (GLA) in Mexico's leading real estate markets, equivalent to a 24% share of the GLA in the consumer goods submarket.

It is worth mentioning that the company's GLA grew by 12% in the last year, with additions in Ciudad Juarez, Mexico City, Monterrey, and Tijuana. The latest expansion of Mercado Libre advances its commercial strategy for 2024, which includes a significant part of the historic investment of 2,450 million dollars that the company will make in the national territory throughout the year.

Growth, Investment, and Markets

Two weeks ago, during a press conference, the operations director of Mercado Libre Mexico, Gabriela Espinosa de los Monteros, indicated that the conglomerate's expansion plans are developing at a crucial moment for e-commerce in Mexico. This sector has seen accelerated growth due to the pandemic. According to Espinosa, Mercado Libre has grown in the last year what could have taken it seven, thanks in part to its dominance in the online fashion sector, where it leads with 46% of the market share, surpassing giants like Amazon, Liverpool, and Coppel. In this sense, the executive explained that Mexico has become its fastest-growing market, with an annual rate of 32%.

The company's figures coincide with the results of the "2023 Online Sales Study" by the Mexican Association of Online Sales (AMVO), according to which the value of e-commerce tripled in Mexico over the last five years, going from 184,000 to more than 658,000 million pesos (or from 10,600 to 37,800 million dollars).

The impact of Mercado Libre's investments on Mexico's industrial real estate market is significant, as it reflects a trend towards the modernization and expansion of logistics infrastructures adapted to the e-commerce boom. In this sense, Mercado Libre is not only betting on the growth of its commercial platform, but it is also contributing to the economic and technological development of Mexico, reaffirming its position as the undisputed leader in Latin American e-commerce.

By the end of 2023, the conglomerate had 90 CEDIS nationwide and a fleet of 900 electric vehicles. In this regard, SiiLA data indicate that the company usually invests in high-quality properties, especially in the northern, Bajio, and central regions of Mexico, with average areas of 22,500 square meters, which is 34% larger than the average GLA of warehouses in the consumer goods sector. This situation underscores Mercado Libre's effort to optimize its logistics network through strategic investments in large-scale infrastructure in markets with high urban density and elevated consumption levels.

For more information on the commercial real estate market, explore SiiLA REsource or contact us at contacto@siila.com.mx.