Mexico Positions for More Manufacturing, by Cushman & Wakefield
The prospect of increased reshoring in the United States opens big opportunities to strengthen Mexico’s role in industrial global value chains, reports Cushman & Wakefield’s “Industrial Real Estate Forecast 2014-2017” report, which includes an overview of fundamentals and trends in Mexico. Low vacancy rates in central Mexico are driving demand for new speculative development and preleasing, the forecast notes, adding that, on the investment front, REITs specializing in industrial property are starting to operate in Mexico.
The forecast points out that Mexico is the world’s eighth largest producer and the fourth largest exporter of motor vehicles, and is becoming a leading location for aerospace productions facilities. Tijuana has the highest concentration of medical device manufacturers in the Americas. These and other industries are driving new industrial development activity in the country. They also are leading to the development of new industrial real estate concepts, such as Vesta’s “park-to-suit” projects, “the first of which was devoted to the aerospace industry and located in Queretaro (Central Mexico), where Bombardier and Safran Group (12 buildings, LEED certified) enjoy specialized coordination and synchronized logistics with their suppliers.” A park-to-suit project is now under construction for Nissan in Aguascalientes, also in central Mexico, as is another in Toluca, near Mexico City. In addition, Honda, Mazda and Volkswagen all are building billion-dollar plants in central Mexico.
Most of Mexico’s industrial markets are experiencing strong recoveries, with central region cities like Toluca and Puebla in high demand. The northeast and northwest also are in fast recovery. “Monterrey’s increasingly healthy performance is reflected in the fact that 70 percent of its new developments are being built on a speculative basis."
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