During the first semester of this year, the industrial real estate market showed notable improvements as compared to its disappointing outcomes from 2009. With the passing of time, economic challenges have lessened in the aforementioned market, a reality that can be noted in the demand that states such as Nuevo León and Querétaro, along with the city of Saltillo, have had from investors to expand their operations, relocate, or establish themselves for the first time in these regions.


Gonzalo Gutiérrez, General Director of Cushman & Wakefield, a real estate firm located in Nuevo León, added that foreign companies interested in establishing a plant in another country generally carry out comparative analyses between different states to see if these states can meet their needs, including the needs to have a skilled labor force, logistics, incentives, quality of life for executives, and security.


“Logistics greatly impact the decision of choosing the location of a new plant. For companies, it is very important to analyze where their raw materials will come from, where their finished products will go to, and how much they will save in the operation if they are located in a state that improves their logistical processes,” said Gutiérrez in his explanation as to why Nuevo León, Querétaro, Coahuila y Mexico City stand out as locations that commonly compete to attract investors.


Because of its attractive skilled labor force and superior availability of industrial spaces, as well as its strategic location and high quantity of diversified supply agencies, Nuevo León has been one of the States with the most notable economic improvement since the beginning of 2010.


According to the analysis performed by Somos Industria, thirty-one industrial real estate closings were carried out during the first semester of 2010, of which 16 were expansions, five relocations, and 10 new companies. “Even though one expected a little bit less {improvement} because of the economic situation, the first semester of this year is considered to have had relative potential,” said René Guajardo, Citius Capital’s Market Analysis Manager.


The sector’s recovery during the first semester of 2010 was impacted principally by the quantity of expansions that occurred in the region. With the goal of attending to and offering more services to their clients, 14 companies increased their operations and expanded their production areas. Such is the case of Trane, which during the abovementioned period carried out two expansions in the Stiva Apodaca Park, one of 125,000 square feet and the other of 100,805, in January and June, respectively.



Similarly, the Carplastic Company, a member of the automotive sector, similarly augmented by 82,500 square feet its production area in the Prologis Monterrey Industrial Center Park in Apodaca.
Dicka Servicios is another one of the companies that also increased its operations by 65,273 feet in the Nexxus Excobedo Park.
In turn, LQK, Sucroliq, Totomac, Easton Bell Sports, Ikegami Mold, Mark IV, Sabic, Scren Tight, and Polaris are all new companies that – seeing Nuevo León’s competitive advantages – have decided to begin their operations there. These sports-related businesses stand out as among the most significant closings carried out during the first period of the year.


One of these businesses, Polaris, will be present for the first time in Nuevo León and has attracted attention due to the size of the space purchased as its new home. In July, the sports equipment company closed its contract to move into a 400,000-square-foot building in the American Industries Dulces Nombres Industrial Park.
The aforementioned closing is estimated to represent 20% of all of the closes that have been carried out during this period.


Likewise, Easton Bell Sport, also a specialist in sports equipment manufacturing, will initiate operations during October with an 117,328-square-foot building in the Nexxus Industrial Park situated in the municipality of Guadalupe.
Another important closing is that of the food and drink company Sucroliq, which will establish its operations in La Silla Apodaca in a 65,582-square-foot plant.
From there, the company will develop sweeteners that allow its clients to improve their production and, as a result, be prepared to confront the global competition more successfully.


Similarly, Haldex recently doubled in size and relocated to a 213,593-square-foot building in the Prologis Park Apodaca Park.
Pentair, a company dedicated to bomb production, relocated in July to a 74,000-square-foot building located in the Intermex Apodaca Park.
“All of the above closings owed to the fact that more and more companies are searching for savings as one of their variables, both in the labor force and in the logistics needed to transport the finished product. A large number of companies evaluate their installations in Asia or stay in America, and Mexico has been relatively attractive,” says Gutiérrez.
Among the competition, many municipalities from the Monterrey metropolitan zone also stand out, and Apodaca continues to be a leader in attracting not just the arrival of new companies, but also expansions and industrial relocations. Of the transactions performed since the beginning of the year, almost 60% of the closings have occurred in this municipality, due both to its location and the concentration of different, labor-providing populations within it.


Apodaca “is located near important roadways, such as Miguel Alemán and el Periférico, which help in leaving from Nuevo Laredo and Reynosa. Moreover, the airport is located in this zone, which is also an important benefit for businessmen.”
During the first semester of 2010, the Prologis Park Apodaca, with has three new buildings coming to its park, is noted as being among the highest-earning industrial parks, along with Diamond Industrial Park in Santa Catarina and Omolap in Apodaca.



Industrial Real Estate Tendencies

The director of Cushman emphasized that the tendency in the construction of buildings and the location of companies nowadays is Class A, that is to say, spaces that are at least eight meters high, with pre-poured cement walls, 15-centimeter reinforced concrete floors, and even skylights.


“The characteristics of the finished products are very standard, very similar to buildings that can be found in the United States,” said Gutiérrez.
Board members and collaborators from Colliers International, an industrial agent, reminded that, in the same way, the quality standards with which they construct the industrial buildings in the Monterrey zone – such as the heights, the thickness of the floors, the relationship of the platforms and ramps vs. the area and illumination, among others – are of the highest level and can compete in any part of the world.



An Attractive City

In Saltillo, 14 contract closings attract attention; among these are included five new companies, three expansions, and one relocation.
The Amistad Ramos Arizpe Industrial Park carried out three of these new business closings.
One of them, Wolverine, is situated in a 76,263-square-foot building; another, Global Flock in 31,500; and BSB Manufacturing in yet another building of 31,500 square feet.
Mercury, in turn, a company dedicated to metal product manufacturing, opted for situating itself for the first time in an area of the Saltillo Coahuila Campus Industrial Park that boasts a space of more than 71,000 square feet.


Julian Electric is another of the companies that, envisioning the benefits that Saltillo could offer, settled itself in a 31,175-square-foot industrial plant in the Alianza Industrial Park in Derramadero.
Martinrea, Huntington, and Parkway in turn expanded their operations in the Amistad Aeropuerto Industrial Park, Amistad Ramos Arizpe Industrial Park, and Amistad Saltillo Sur Industrial Park.



Attraction to the Center of the Country

Located in the center of the country, the state of Querétaro continues to grab more and more of the attention of industrial real estate development businesses.
Its railway and highway infrastructure, as well as its airport with a growing cargo transport, are some of the competitive advantages that Querétaro has shown and that especially appeal to investors.
“In the State there also exist excellent supply agencies both for the companies that establish themselves there and for potential clients,” said José Berumen, Director of Alterra Inmobiliaria.


Nowadays, he explained, metal-mechanical, electrical appliance, food, aerospace y auto-parts companies deem the Querétaro and San Juan Del Río zones as some of the most attractive locations for investments, both in manufacturing and in distribution, respectively.
Queretaro saw in the first semester of 2010 the close of 8 contracts in witch stands out the the arrival of the Canadian aerospace company Lear Jets stands out; it will start operations in September in a 183,770-square-foot-building in the Querétaro Aerospace Park.
Likewise, Anixter of Mexico and MAN/Volkswagen expanded in the Marqués Industrial Park in buildings of 66,640 and 26,092 square feet, respectively.



Note: To see the complete list of real estate contract closings carried out in Monterrey, Saltillo, and Querétaro during the first semester of 2010, go to the page 45.