The industrial real estate market has shown surprising results by the end of the first quarter, exceeding expectations and changing the factors that govern it during this period of uncertainty. One of the most significant changes has been the decrease in prices, a consequence of the increase in supply in previously attractive markets, which historically had low availability rates and growing demand.
During this period, the price and availability trends in the 16 most important markets have interrupted their records at historic minimums and maximums while the construction of new projects has continued. According to the latest national industrial report from Newmark Mexico, this situation has influenced the price drop in places like Guadalajara and Ciudad Juárez, where supply has increased due to a pause in leasing decisions in sectors such as automotive and some areas of manufacturing.
In Ciudad Juárez, for example, availability has grown by approximately 9 percent, as it had previously been almost zero due to high demand. This trend has been reflected in an annual price drop of 8 percent in Guadalajara, while in regions like Puebla-Tlaxcala, Monterrey, and Saltillo, the decrease in availability has increased rental costs by a range of 11 to 24 percent.
In this scenario, the question arises about the future when the 4.47 million square meters under construction in attractive markets are added to the inventory, reaching 85 million square meters. In this context, the challenge lies in achieving a balance in a sector that during the first quarter of the year has only had a positive net absorption balance in four markets, negative in six, and neutral in the remaining six.
Beyond the law of supply and demand, the productive reorganization of the affected sectors aimed at the United States could promote a return to balance and expansion. This is supported by the entry of new potential players, as observed in the Mérida industrial area, which is close to reaching an inventory of one million square meters.
