Monterrey’s industrial market is going through a period of adjustment following several years of expansion and strong momentum in new project development. Increasing supply, coupled with more moderate demand, has prompted developers to adopt a more cautious approach, reflected in a sustained decline in industrial space under construction over recent quarters.

Of Interest: Industrial Report: Solili | October 2026

In February 2025, industrial space under construction reached a recent all-time high, exceeding 2.2 million square meters. Since then, the indicator has maintained a downward trend, reaching approximately 750,000 square meters at the close of October 2026, its lowest level since mid-2021.

This slowdown comes amid a growing supply of industrial space. At the close of October 2026, Monterrey reported a vacancy rate of 6.6%, ranking among the markets with the highest vacancy levels nationwide, behind Tijuana and Reynosa, which posted rates of 9.7% and 7.3%, respectively. These conditions have led developers to adopt a more selective approach, prioritizing the absorption of existing inventory before introducing additional space to the market.

Meanwhile, more than 450,000 square meters of industrial space broke ground between January and October 2026, compared to 1.03 million square meters recorded during the same period in 2025. This represents an annual contraction of approximately 56%, reflecting a slowdown in new development activity amid rising vacancy and more moderate demand conditions.

Read more: Saltillo Maintains One of Mexico’s Lowest Industrial Vacancy Rates at 2.3%

Regarding demand, Monterrey recorded cumulative gross absorption of 889,000 square meters between January and October 2026, compared to 926,000 square meters during the same period last year. This represents a decrease of 37,000 square meters, equivalent to an annual decline of approximately 4%, as companies remain more cautious in their expansion and occupancy decisions.

The evolution of these indicators reflects an adjustment process in Monterrey’s industrial market, where the slowdown in construction is beginning to align with current supply and demand conditions. Moderating the development of new projects will allow the market to gradually absorb available space and move toward a more balanced environment, while developers maintain a more prudent growth strategy.