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Industry and e-commerce to boost demand for industrial spaces in 2021

Complexes used for logistics and industrial operations will grow by up to 7% due to the demand for industrial space by logistics, e-commerce and manufacturing companies. 

This year will generate an increase in demand for industrial spaces due to projects signed by logistics, e-commerce and manufacturing companies (mainly food, beverages, pharmaceuticals, medical equipment and automotive suppliers).

This sinercy will also continue in the construction of new industrial buildings, since at the end of the third quarter of last year, construction projects recorded a 19% increase, with just over 2.2 million square meters scheduled to be completed in the next 18 months. The main areas to benefit from this are metropolitan areas for logistics and the border for the manufacturing sector.

According to Yadira Torres, Director of Market Research at CBRE, the demand for logistics lessees and the recovery of potential projects in the export manufacturing area is due to the USMCA entering into force.

This is reflected in the Foreign Direct Investment (FDI) recorded in the first half of last year, where the manufacturing sector grew 29.9%, followed by the automotive sector with 23.2% and the logistics and transportation sector with 17.3%.

This growth also influenced companies seeking industrial spaces: manufacturing grew 34.5%, the automotive industry 11.8%, as well as logistics and transportation by 21.4%.

The industrial market and logistics have tried to adapt to the health emergency. The former benefited from the breakdown of production chains, which were more concentrated within countries, as well as from the USMCA, while the latter benefited from the growth of e-commerce, which, according to figures from the Mexican Association of Online Sales, increased by 60%.

Therefore, compared to 2019, the market where the logistics sector is in high demand. and is projected to continue to benefit the logistics sector, as well as e-commerce companies, retailers and the manufacturing industry.

New challenges for industrial space developers

The industrial-logistics sector has been one of the most resilient sectors regarding the current situation. However, as a result, challenges have arisen for developers of distribution centers, industrial parks and buildings, which must be increasingly more intelligent and require adequate infrastructure to support tools such as artificial intelligence and robotics, so that customers can fulfill their operations and productions. 

According to Fernando Peréz, Director of the Real Estate Division at DHL, technological advances, geopolitical changes and the emergence of new business models have transformed supply chains across industries locally, regionally and globally, which has been reflected in requirements such as greater flexibility of facilities, advanced sensors for access control, intelligent lighting and good connectivity to streamline the distribution process, with technology that helps track shipments in real time from point of origin to final destination and qualities that promote sustainable and energy-saving actions.

Bruno Martínez, CEO of Alveo Kapital, pointed out that the most important thing is to have industrial spaces in which all equipment can work and raises three fundamental points: sustainability (optimizing the use of energy), safety (considering that lessees require spaces with specific qualities for their products) and connectivity (to ensure that processes and communications are not interrupted). In addition, he explains that it should be considered that the demand for square meters could be transformed into cubic meters.

This has been due, to some extent, to the development of e-commerce during the pandemic. Therefore, Claudia Ávila Connelly, Executive Director of the Mexican Association of Industrial Parks (AMPIP) stresses the importance of understanding that in this segment there are several players that set their trends in warehousing and distribution services. However, the key to e-commerce is delivery time, which includes the last mile and reverse logistics. 

Likewise, she believes that new developments should consider the following factors: location to facilitate customer delivery, efficient building design, safety in fulfillment centers, adequate work environment that motivates and contributes to quality of life, training centers linked to universities to help their lessees recruit staff.

Oradel Industrial Center offers industrial spaces for international companies to establish their manufacturing and logistics operations just minutes from the international bridges with the United States. In addition, it has all the required services within its facilities for companies, safety, the Technological University of Nuevo Laredo and 5,000 residences for people who work in each of the industrial buildings.

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