Real estate developers anticipate increased demand for warehouses and distribution centers in border cities in an effort to establish manufacturing hubs closer to the US market. Following numerous supply chain interruptions linked to China during and after the pandemic, many businesses made the move to take their operations out of Asia and bring them closer to home. North American manufacturing experienced a sudden rebound which drove an industrial real estate Renaissance.
Mexico has become especially attractive for manufacturing companies worldwide as concerns grow over trade disputes between the United States and China and the conflict in Ukraine. Demand for industrial space is increasing on the American side of the border as manufacturing logistical hubs for goods manufactured in Mexico, such as electronics and medical equipment. This growing market has not gone unnoticed by institutional investors. The largest logistics real estate company in the world, Prologis Inc., reported that demand for premises in Mexico is soaring, while investors like Morgan Stanley are concentrating on warehouses in U.S. border towns in states like Texas and California.