With the surge in nearshoring, the gross leasable area of warehouses and industrial buildings is on the rise among Real Estate Investment Trusts (REITs). The Mexican Association of Real Estate Investment Trusts (Amefibra) stated that with the nearshoring boom, the lease of parks, warehouses, and industrial buildings is increasing among REITs, as Mexico has captured only 3% of the gross leasable area of China’s industrial market.

A demand for 2.3 million square meters of industrial spaces is anticipated, which could capture the potential investment demand that nearshoring will require for the development of such spaces, added the REITs’ representative. With the influx of investment, the industrial real estate market would double, currently standing at around 650 million square feet.

Given the impetus of nearshoring and the ongoing development of the real estate sector, REITs are currently one of the safest and most attractive financing vehicles for national or foreign investors. Most industrial REITs have diversified locations in the northern region of the country, near the border with the United States. Since their entry into the Mexican Stock Exchange (BMV) in 2011, Real Estate Investment Trusts (REITs) have grown, obtaining a total of resources of 176.501 billion pesos to finance the integration and purchase of real estate portfolios in the country.

Currently, REITs represent over 4% of the estimated national equity, as well as 4.5% of the gross domestic product with over 27 billion pesos. Mexico has 16 real estate investment trusts dedicated to collecting and distributing dividends from rents in various sectors, such as industrial, offices, shopping centers, hotels, education, self-storage, and even in the agricultural sector.

From the first quarter of 2022 to the same period this year, REITs extended nearly one million square meters of industrial gross leasable area, according to their financial reports on the stock exchanges.

Our country’s stock market has 16 listed REITs, of which Fibra Uno (Funo), Prologis, Terrafina, Macquarie, Fibra MTY, Nova, Plus, and Upsite own leased properties for industrial use, according to Amefibra. From January to March 2023, REITs reported a total of 18.8 million square meters of gross leasable area, in contrast to the approximately 17.9 million square meters of leasable space in the first quarter of 2022, representing an increase of 5.16%, equivalent to 923,156 square meters.

Fibra MTY doubled its portfolio in a year, going from 35 properties to 78. Its leasable area grew to almost 1.4 million square meters, from 591,986 square meters, a 132% increase. In March 2023, this trust made its second-largest industrial real estate acquisition in Mexico, with an investment of 662 million dollars, acquiring from Finsa, an industrial real estate developer, its Zeus portfolio of 46 properties and a total of 822,052 square meters of leasable space.

Fibra Uno, considered the largest real estate trust in Latin America, has a total of 10,990,000 square meters of gross leasable area. The company reported an increase in its industrial segment properties for the first quarter of 2023, with over 6 million square meters of gross leasable area, compared to the 3.4 million square meters it reported at the end of 2022.

REITs like Prologis and Terrafina have 4 million square meters of industrial space and nearly 3.7 million square meters, respectively, making them the second and third-largest real estate trusts in the sector. This is to meet the demand for industrial spaces generated by nearshoring.

Prologis has been present in six real estate markets in the country since 2014: Mexico City, Monterrey, Juárez, and Tijuana. Terrafina, on the other hand, has a greater presence in Chihuahua.

Fibra Macquarie reported earnings of 947.1 billion pesos at the close of its fourth quarter of 2022, 3.18% more than the previous year, which closed at 917.9 billion.

The REIT’s portfolio is divided into two segments: industrial and commercial, 87% and 13%, respectively. Its total occupancy rate closed in the last quarter of the previous year at 96.8%. The commercial occupancy rate was 90.9%, while the industrial occupancy was 97.6%.

Fibra Nova benefited greatly from nearshoring, delivering an additional 106,000 square meters of gross leasable area in 2022.