With only one month left for the settlement of 2022, we were able to observe the dynamism that construction took on in the Mexican industrial market. The developers assumed the risk by starting their projects in the midst of a time of high inflation that pressured them to complete the warehouses that were being built on time and at cost, in order to thus achieve the profit expectations of the business.

In this context, we saw the completion between October and November 2022 of about 320,000 square meters of works that will feed the inventories of their respective markets.

Of interest: Industrial demand for 2022 in Mexico already exceeds that of 2021 by 13%

Tijuana manages to complete 81 thousand square meters, while Ciudad Juárez and Mexicali do the same with the term of 71 and 68 thousand square meters. The rate at which constructions are completed and fed into inventory has allowed a turning point in vacancy to form since September 2022, which closed in November at 0.78%.

In Ciudad Juárez the same upward trend is registered and vacancy goes from 0.21% in October to 0.54% at the end of November 2022. In the case of Mexicali this phenomenon is even more pronounced since vacancy has been in an ascending line since June 2022 where it registered a record low of 0.97% until the end of November with 2.59%.

With these movements we can infer that speculative construction is the trigger that allows vacancies to rise to acceptable levels that in the medium term do not lead to pronounced shocks in the rental price that in the long run affect the stability of the real estate business.

The rest of the markets that completed industrial works in the October-November 2022 bimester are  Monterrey, Guadalajara, Querétaro y Guanajuato. Monterrey settled in this period a little over 56 thousand square meters and a little more than 1.59 thousand square meters are still under construction, with a difference of 2.5 times that of its closest competitor, Mexico City.

The proportion of new offers is very small compared to the inventory of this border market, which fails to supply the gross monthly demand, which in November alone was 95,000 square meters. Since February 2021, this market had reached its maximum vacancy of 6.10% and from that moment on it has been in constant decline until reaching 1.36% at the end of November, which is equivalent to almost 195,000 square meters of available spaces.

Check here: What are the industrial markets that dominate construction in the country?

Guadalajara, for its part, completed 26,000 square meters and is also still in the group of entities that continues to adjust its vacancy downwards and closes November with 0.62%, an amount that reflects a downward annual adjustment of 1.64 percentage points.

In the lowlands, we also saw the completion of works between October and November for the amount of 10.5 thousand square meters in Querétaro and 5 thousand square meters in Guanajuato. In Querétaro and Guanajuato, vacancies are 2.32% and 5.37% in November and both have made adjustments again since mid-2021 where the decline began.