Tijuana has been one of the industrial markets that has seen its demand contract to less than half a percentage point, being one of the lowest percentages at the national level, only surpassed by Tecate with 0.34%.

The pressure of gross demand on existing industrial spaces in Tijuana has resulted in rental prices rising to levels above $6 dollars per square meter per month, slightly lower than those observed in Mexico City.

Now, when we analyze the concentration of demand in the Tijuana market at the end of 2Q 2022, it is the El Florido-Boulevard 2000 and Pacifico Nórdica submarket that account for nearly three-quarters of the absorption.

Florido-Boulevard 2000 is the submarket that is located farthest to the east in this important border market and whose natural growth is towards Tecate through the Tijuana-Tecate highway.

See also: Northern industrial markets the big winners in the first half of 2022

For its part, the North Pacific submarket, which is located further south-west of Tijuana, is close to Rosarito, with which it communicates through the Transpeninsular Highway or Federal Hwy1.

Although Otay-Alamar is currently the border submarket closest to the United States and concentrates 30% of the entity's industrial inventory, it maintains a null vacancy equal to that of Florio-Boulevard 2000, La Mesa-Vía Rapida  and The Lake.

The scarce vacancy that exists in this market is located in Pacifico-Nordika with 23 thousand square meters and the Rosarito submarket with almost 10 thousand square meters. Another phenomenon observed is that what is progressing in construction that exceeds 390 thousand square meters is practically already in closings and the vast majority enter the inventory occupied.

The geography of this market will allow natural growth to the east and to the south-west in the immediate future, which would be where Tecate and Rosarito are located, respectively.

Tijuana is separated from Tecate by 40 km or a travel time of three quarters of an hour.

For its part, Tecate during the first two quarters of the year already reached 40 thousand square meters of gross demand, a value that far exceeds that registered in the same periods of the last 4 years. In turn, in Tecate, industrial warehouses that were being built have been completed and occupied and currently there are only 12,000 meters under construction, so we will surely see the start-up of new projects in the remainder of the year.

Of interest: Nuevo León leads in foreign investment in 2Q 2022

The correlation between these indicators such as demand, vacancy and construction allow us to infer that markets on the western border such as Tijuana and Tecate will continue to experience significant pressure from the United States. 

The marked need for manufacturing expansions and relocations that are required to complete chains in the automotive, electronics, food, manufacturing and medical supplies sectors will continue to drive the growth of the industrial sprawl from Tijuana to Tecate and Rosarito.