Newmark: Despite Challenging Times, Real Estate Remains ResilientBy Lorenzo Núñez | Mon, 12/13/2021 - 10:00
Q: What will it take for the real estate sector to recover to pre-pandemic levels?
A: The real estate industry has shown signs of resilience despite the challenging times brought by the pandemic. In spite of this situation, many segments in the real estate industry have performed very well. For instance, the industrial sector has benefited from the e-commerce boom that developed alongside the pandemic. Companies have had to make investments to improve their logistics and expand their distribution capacity. As a consequence of COVID-19, industries are looking for more space, which is further boosting the industrial segment.
As for other segments, we project that they will take longer to recover. By 2023 or even 2024, we might start seeing a full recovery for housing and office real estate. For now, we expect to see the industrial segment continue to thrive.
Q: According to Newmark’s Latin American Industrial Index, Mexico’s cities register the lowest vacancy rates. What does this say about Mexico’s industrial segment?
A: For many years, Mexico has been an economic leader in the region. One of the country’s advantages — and one of its main opportunities — is its trade relationship with the US. At Newmark, we are exploring how we can exploit these opportunities between the two countries. For instance, some Asian companies want to have a much closer relationship with Mexico and the US. This represents a growth opportunity for various industries, such as automotive, logistics, e-commerce and many others. We need to take advantage of all these opportunities to position our country as strongly as possible. Mexico has very tight vacancy rates in its border cities, which shows that our industrial market is healthy and that there are always companies looking to enter the region.
In regard to further development, the private sector needs a better relationship with local governments. In my opinion, the Mexican government is making good progress in trying to attract more investment but the private sector needs to be more involved in these plans. In addition, the government needs to provide more infrastructure to increase our real estate competitiveness so that we can properly compete with other regions in North America and Asia.
Q: What opportunities do you see in Mexico’s southeast, especially considering new projects like the Mayan Train and the Transisthmic Corridor?
A: The southeast region is seeing increasing its number of transactions and tenants that are looking to expand their operations. We are even beginning to see newcomers arriving in the region. Cities like Merida, Villahermosa and Tabasco have come under the spotlight because of these projects and the increased industrial activity. This will ultimately become a great opportunity for these cities and for the entire region.
Q: Why is Newmark’s Global Corporate Service the best platform for corporations looking to begin a project in Mexico?
A: Our talented human resources are available for corporations that want to set up a project here. At the corporate level, we have been investing in technological platforms to track and identify the best market opportunities for our clients. The entire package is a world-class service for companies that are launching new projects. Investing in our human resources and in technological solutions has really pushed us forward during the pandemic.
Clients are looking for information regarding the daily conditions of the market and key performance indicators. All this information is laid out for our clients, allowing for better decision-making. Our clients also want information regarding state laws. For instance, they want to know which states provide incentives for investment. Newmark is always innovating and strives to provide the best and most accurate information. The company is also looking to expand its network of strategic partners through joint ventures in every local market to increase Newmark’s impact.