Overview of the Industrial Real Estate Sector in Mexico’s Northern Border
The industrial real estate sector in Mexico’s northern border region has experienced a significant slowdown, with occupancy rates falling by nearly 30% compared to the same period in the previous year. Between January and September 2025, 15.3 million square feet of industrial real estate space was occupied in the region, down from 21.7 million square feet during the same period in 2024.
Key Markets and Their Current Status
The analysis by Datoz covers major industrial markets from Ensenada to Matamoros, including Tijuana, Ciudad Juárez, Monterrey, Hermosillo, Chihuahua, and Saltillo. These areas benefited from the post-pandemic nearshoring boom but now face a period of adjustment.
Factors Contributing to the Slowdown
Pablo Quezada, Datoz’s General Director, attributes the slowdown to uncertainties caused by the U.S. trade policy and internal factors. The Confederation of National Chambers of Commerce, Services, and Tourism (Concanaco Servytur Mexico) conducted a survey in 19 federal entities, with 83.8% of entrepreneurs reporting that they know a company considering closing, reducing, or relocating operations outside Mexico.
- High operational and tax costs (58.2%): Companies are grappling with rising expenses, making it difficult to maintain operations in Mexico.
- Sudden regulatory or customs changes (41.8%): Unpredictable policy shifts have added to the uncertainty for businesses.
Industrial Warehouse Vacancy and Business Exit
The slowdown in the industrial warehouse market is evident not only through fewer contracts but also through businesses leaving established locations. Datoz’s industrial vacancy index shows an average of 2.2% for the year, though some markets exceeded this level.
- Reynosa: 2.35%
- Mexicali: 2.33%
- Tijuana: 3.58% (up from 1.86% in 2024)
Quezada mentioned that a logistics company left, subletting an entire 200,000 square feet building. While there have been other exits, he emphasized that this is not a cause for alarm in the sector.
Expectations for 2026 and Beyond
For 2026, Monterrey, the leading industrial city in Mexico’s northern region, is expected to experience contraction in occupation and new project construction rates. However, the renegotiation of the USMCA (United States-Mexico-Canada Agreement) generates expectations for the sector.
Quezada noted that Mexico retains structural advantages for trade with the U.S., and favorable business conditions could lead to significant growth, potentially sparking another major surge in occupation like the nearshoring trend.
Concanaco-Servytur has highlighted internal issues that could be addressed nationally to encourage investment, such as security concerns on production routes, slow institutional response times (up to 750% slower in the SAT), regulatory duplication across government levels, and electricity supply cost and instability.
