Construction of industrial spaces in Monterrey remains at historical highs: CBRE

Monterrey, NL. El Monterey Industrial Market continues to expand with historical levels of construction, despite the complex international economic and political panorama, due to the attractiveness it is for investors seeking to meet the demand for North American consumption and nearshoring projects, indicates the report for the third quarter of CBRE.

The building remains at historical highs with more than 927,000 square meters, distributed in 33 projects; 79% of this area corresponds to pre-leases, leaving only 194,000 square meters to the speculative market.

This trend has intensified over the past few months due to low vacancy of existing buildings and businesses seeking larger-than-average-size properties in the market,” he said. CBRE.

Quarterly gross absorption (occupied square meters) exceeded 414,000 square meters, and in the accumulated total from January to September it registered 1.39 million square meters, a figure 52% higher than that registered in the same period of 2021.

“The manufacturing sector, as well as investments of Chinese origin, are positioned as the main drivers of this industrial activity at the end of the quarter,” says the report from CBRE.

The executive vice president of CBRE Noreste, Ramón Flores, explained that the proximity of Monterrey to the border with the United States, the highly qualified workforce, good infrastructure and solid supplier base, make it a very advantageous location for occupants and investors. This positions the state as one of the main industrial markets.

The state economic environment is reflected in the growth of the industrial inventory in Monterrey, where at the end of the third quarter it added 251,000 square meters in 16 new properties, closing at 12.17 million square meters of existing inventory.

State economic environment

The Ministry of Economy (federal) reported that New Lion closed the first half of 2022 with a Foreign Direct Investment (FDI) of 2,661 million dollars, which represents 9.7% of the entire country, which is equivalent to a growth of 104% compared to the same period of the previous year and 82% of the annual value of last year.

This growth is the result of expansion projects of companies that already had a presence in the state and are growing to meet the demand of the United States, as well as the arrival of new investments due to nearshoring, explains the report.

In turn, formal employment for the first half of this year, according to data from the Mexican Social Security Institute (IMSS) reported that Nuevo León ranked first nationally in the generation of new jobs in the accumulated as of August, with 75,000 new jobs. This growth brought the unemployment rate to its lowest level since the fourth quarter of 2019 (before the start of the pandemic) closing at 3.7 percent.

The Chamber of Transformation Industry of Nuevo León (Caintra) reported that the sector industrial continues to grow, as all manufacturing indices are within the expansion threshold at the end of July, with the exception of imports and exports, which showed a slight decline.

Demand

The manufacturing sector continues to be the leader in industrial demand in Monterrey and its metropolitan area, occupying 70% of the total leased area, followed by the automotive and high-tech sectors, with 14% and 12%, respectively.

“These three sectors have been the main drivers of activity in the index accumulated to the third quarter. China continues as the main country of origin of new investments, with 46% of gross absorption, investments from Germany come second with 22%, and the United States with 19 percent.

At the end of the third quarter, the inventory of the Monterey Industrial Market closed at 12.17 million square meters, which meant an annual increase of 7.5%. Likewise, more than 251,000 square meters of new industrial spaces were delivered between July and September, with the Apodaca and Salinas Victoria markets being the ones that contributed the most to the new offer.

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