The recovery of the office real estate market was notable during 2023. The three most important markets in the country experienced the highest demand for corporate spaces since the economic crisis caused by the COVID-19 pandemic. This was motivated by various factors such as contract flexibility, nearshoring, foreign direct investment, among others.
Gross absorption, that is, transactions in sales and leases excluding renewals, of office spaces in Mexico City, Monterrey, and Guadalajara increased considerably compared to the previous year, with 80%, 30%, and 36%, respectively, according to information from Datoz.
Mexico City
The largest office real estate market in the country reached a gross absorption of almost 370,000 square meters (m2), which is significantly higher than in 2020 and 2021, and 80% higher compared to 2022. With this, the financial and administrative center of the country has begun its recovery, as gross absorption was consistent throughout all quarters of 2023.
The corridors that had the highest activity in lease or sale were Insurgentes and Polanco, with 88,499 m2 and 76,991 m2, respectively; accounting for 45% of the total market demand. These are the most attractive corridors in the city because they are part of the Central Business District (CBD), and they have Class A and A+ buildings with competitive asking prices and flexible contract schemes, cowork spaces, and plug and play offices.
With this flexibility in the minimum lease space, spaces leased below 1,000 m2 predominated. The exception was the leasing of offices larger than 15,000 m2, which occurred in only two operations: one was for the educational sector in the Reforma corridor, and the other was for the retail sector in the Periférico Sur corridor.
Monterrey
During 2023, Monterrey almost reached a gross absorption of 100,000 m2, the highest in the last five years. Even though 90% of the transactions were leases, this year, the sale of offices to end-users and investors played an important role in gross absorption, specifically in Santa Catarina corridor.
Margáin-Gómez Morín corridor concentrated 25% of the transactions, with 23,150 m2, followed by Valle Oriente with 16,442 m2, which represented 17% of Monterrey’s total absorption. The absorption in Margáin-Gómez Morín was driven in the last quarter of the year, with the lease of over 20,000 m2 of corporate space by an energy company in the Punto Valle building.
The office market in Monterrey has consolidated, hand in hand with the industrial sector, as many of the operations are related to manufacturing and logistics companies.
Guadalajara
Guadalajara achieved a gross absorption of over 75,000 m2 in 2023. Financial services, electronics, and technology companies were the main demand drivers for corporate space this year.
López Mateos Sur and Zona Financiera led gross absorption in Guadalajara during 2023. López Mateos Sur led absorption with the occupancy of 29,268 m2, followed by Zona Financiera, which totaled an absorption of 20,180 m2. Both corridors accounted for 64% of the total absorption.
The lease of Mutuo, a company dedicated to leasing private and shared offices, in López Mateos Sur corridor, with over 5,000 m2 in Margot 1297 building, stands out. Also noteworthy are the leases of Banco Nacional de México and Citibank in Hélix Tower.
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