In the midst of the challenge that the pandemic implied for the corporate markets at the national level, the office markets of Tijuana and Mérida have managed to emerge stronger, both by maintaining levels of gross demand and by establishing a rental price that allows them to look optimistically at the future.

Although the size of their inventories participates very little in the national total, between the months of January to August we would be facing an average demand of 10 thousand square meters, in each of them.

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At the end of September 2002, Mexico City registered an average rent of $21.10 dollars per square meter per month, with the following markets with the highest rents at the national level being Tijuana with $19.85 and Mérida with $19.26 dollars per square meter per month.

The balance of prices that these two emerging markets present is related to the low levels of new construction and the low levels of construction that have not yet been completed, totaling 43,000 and 34,000 square meters for Tijuana and Mérida, respectively.

The vacancy that has come with a downward slope is another element of the equation that maintains stability in rents. In the case of Tijuana, it closes September 2022 with 7.58%, which represents an adjustment of more than 3 percentage points in the last year. Mérida advances in a similar line of downward adjustment of the vacancy that registered 3.4 percentage points of contraction and closes in September 2022 with 9.58%.

By delving into where the vacancy is concentrated, we can analyze that the average does not reflect the reality that is situated in the corridors of these markets. For example in Tijuana

the Zona Río corridor, which concentrates almost 70% of the inventory, practically has a null vacancy of only 1%, while the Vía Rapida corridor located after Zona Río and located to the southeast has almost 25,000 meters available, representing more than 35% vacancy, although they are located further from the border.

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In the case of Mérida, the Altabrisa and Garcia Lavin corridors present 7.8% and 8% vacancies much closer to the average, while Cabo Norte and Montejo exceed 13%. In this case, the corridors where the gross demand for 2Q 2022 is concentrated were

Garcia Lavin, Cabo Norte and Altabrisa with 70%, 18% and 12%, respectivamente.

Another consideration that both markets share is the increase in their sustained industrial demand, which has allowed a greater interest from developers and investors to make properties for purchase at a time when prices are still competitive and that would guarantee better returns in the future to come. In the particular case of Mérida, the perception of security in investments has borne fruit in attracting small investors to the White City who see this destination as a place for a second home or an investment that allows them to diversify family portfolios.