Inflation and the resurgence of Covid infections due to the Ómicron variant during the first quarter caused the office market to increase prices slightly, projects focused on rent were paused and an oversupply of spaces was maintained, commented Pablo López, Director of Market Research at Solili.

Despite this, demand, in terms of net absorption, was lower than previous quarters, these remained in positive numbers, while gross absorption, although it was lower than the two previous quarters, continues to move towards recovery. albeit slowly.

"We do see effects (in the office market in the Monterrey metropolitan area), but not of the dimensions that occurred in the first quarters of the pandemic, and this was due to the Omicron and inflation."

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“On the issue of Ómicron, the companies were, on the one hand, delaying the return to offices and, on the other hand, pausing the projects that came for rent. As for inflation, what it has generated is that companies carry out an in-depth financial study to determine and make adjustments to this price increase, which was also reflected in the offices,” he explained.

Regarding the price per square meter, the prices practically remained similar during the first quarter of 2022 (1Q22) compared to the first quarter of 2021 (1Q21), that is, they went from 17.90 dollars to 18.70 dollars.

“We are seeing an increase in rents basically driven by the issue of inflation and the readjustment that developers are making of the price they were having, although the market has not yet managed to stand out. Vacancy rates continue to be in a state of oversupply and exceed 20% of vacancy.”

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"Construction has stopped as a result of issues such as the one that developers are waiting for the market to reactivate or have better indicators for, from there, to trigger some projects that we have close to starting construction."

He reiterated that the outlook for offices will improve thanks to the advancement of vaccination and the interest of companies in returning to offices.

In Solili you can consult available offices in Guadalajara, Tijuana and Ciudad de México

Original note