Although the year that is ending was a sustained path towards the recovery of office demand, 2022 closed with 85% of the gross demand that the corporate market reported at the end of 2019, the last year before the pandemic. This percentage corresponds to the accumulated annual gross demand of the five main corporate markets that include Mexico City, Monterrey, Guadalajara, Tijuana and Querétaro.

But a determining factor at the beginning of the post-pandemic period was unemployment, to the extent that corporations expired their contracts and had signed clauses that allowed them to agree on advance deliveries, unemployment grew significantly, mainly in 2020 and part of 2021.

This movement of forces between a shrinking gross demand and growing unemployment resulted in the negative net demand figures reported by Mexico City that spun 6 consecutive quarters between 2Q 200 and 3Q 2021, after a last quarter where It was thought that the recovery was already beginning, the beginning of 2022 came when it was affected by a new strain of the covid and in the first quarter of the year the net demand returned to negative ground and from then on it maintained a gradual but sustained growth.

When analyzing the figures at the end of 4Q 2022, gross demand in Mexico City reached 81% of what was registered at the end of 4Q 2019. When comparing net demand, the proportion reaches 52%. These figures are given in a scenario where demand growth had slowed down and in recent months, since September 2022, it has slowly declined to close to 21.75% in Mexico City.

Of interest: Office construction could be reactivated in mid-2023

However, there are submarkets within the capital such as Periférico Sur, Lomas Palmas, Polanco and Reforma where vacancies are already between 16% and 18%. In the case of Periférico Sur and Lomas Palmas, only 4.5 and 11.6 thousand square meters of projects remain under construction, which are advancing and which could be largely available this year, thus competing with the existing vacancy in these submarkets.

When analyzing the most demanded sizes in the country's capital during the last quarter of 2022, 75% of the number of transactions are located between 100 and 1,000 square meters. If the analysis is carried out in the total area, close to half is concentrated in areas between 500 and 2,000 square meters. Both figures tell us where the demand from tenants would be concentrated for the first quarters of 2023.

See also: Where will the industrial vacancy of the country's markets head in 2023?

Regarding the geographical location, the last quarter of the year marked the trend of an equitable distribution of demand between Santa Fe, Reforma, Polanco and Insurgentes, which maintain an average level of 37 thousand square meters quarterly per submarket, grouping among the four submarkets the 80% of the total capital demand.

Although vacancy levels in Mexico City remain high to meet demand projections, let's remember that this type of investment is planned in scenarios of 10 years on average with a market that responds to cyclical behavior that developers anticipate and on which They take a planned risk.

Therefore, there will continue to be important business opportunities for those who manage to attract interest for well-distributed spaces, with above-average endowment facilities for gross demand that will continue to project its growth in 2023.