Published on and written by Cyril Jarnias
The commercial real estate market in Mexico is changing scale. Between the rise of industrial nearshoring, the explosion of e‑commerce, the growing prominence of data centers, and the recovery of tourism, the country has become one of the most dynamic playgrounds in the world for real estate investors. All within a legal framework relatively open to foreign capital and a macroeconomic environment more stable than many of its Latin American neighbors.
The Mexican commercial real estate market is estimated at over 60 billion dollars.
For an investor, the question is no longer whether there are opportunities in commercial real estate in Mexico, but where and how to position yourself intelligently, while managing risks, the legal framework, and taxation.
A rapidly expanding market, driven by industry and logistics
The main engine of the current wave of investment can be summed up in one word: nearshoring. More and more international groups are moving their production and assembly chains to Mexico to get closer to the North American market, secure their supply chains, and reduce costs.
The consequences for commercial real estate are spectacular. The industrial-logistics segment already accounts for more than a third of the market value (around 33% in 2025) and shows the fastest growth trajectory, around 8% per year until 2031. Industrial parks are nearing 98% occupancy rates in the most sought-after areas, and national industrial vacancy stood at around 3.9% in 2022, giving owners significant pricing power for rents.
More than 2.5 million m² of industrial space were delivered in France in 2024.
The key role of logistics and e‑commerce
Beyond manufacturing, logistics driven by e‑commerce is becoming a sector in its own right. The Mexican logistics market generates nearly 175 billion dollars and is expected to continue growing at a rate above 5% per year over the next decade. E‑commerce is accelerating rapidly: it already accounts for several tens of billions of dollars and could exceed 170 billion by 2033, with online sales growing at more than 14% per year.
Digital transformation directly impacts commercial real estate, creating demand for warehouses, distribution hubs, ‘last mile’ facilities, and omnichannel fulfillment centers. To attract major tenants (Amazon, Mercado Libre, DHL, FedEx, Estafeta, food and specialty retailers), these warehouses must meet specific standards: clear height of around 12 meters, reinforced flooring, LED lighting, ESFR sprinkler systems, pre-installed automation rails, and fiber connectivity.
Online shopping penetration has literally exploded: the share of Mexican internet users who shop online has gone from around 60% to nearly 85% in just a few years. As a result, demand for logistics warehouses is soaring, with over 1.7 million m² of industrial space leased in the third quarter of 2024 alone, 14% more than a year earlier. The automotive manufacturing sector alone accounts for nearly 38% of this industrial demand, illustrating the decisive weight of this industry in real estate dynamics.
A few orders of magnitude
To visualize the depth of the market, here is a summary of the main announced volumes from industry studies:
| Key indicator | Approximate value |
|---|---|
| Commercial real estate market value (2026) | $64.2 billion USD |
| Commercial real estate market projection (2031) | $92.4 billion USD |
| Logistics segment share (2025) | 33.2% of market |
| Logistics growth rate (through 2031) | 8.1% / year |
| Industrial park occupancy rate | ~98% |
| National industrial vacancy (2022) | 3.9% |
| New industrial investments (2024) | $3.17 billion USD |
| Average cap rate – industrial | ~7.2% |
| Unlevered returns – industrial | ~10% |
For a commercial real estate investor, these figures are rare in a large, relatively liquid market already integrated into the North American economy.
Geographic hubs to watch
Mexican commercial real estate is not homogeneous: each region has its own logic, economic drivers, and risk profile. To structure an investment strategy, it is crucial to distinguish the main zones.
Mexico City: financial, office, and tech heart
The capital concentrates nearly a quarter of the national commercial real estate market value. It is the country’s main office hub, but also a major logistics hub and a key market for retail and hospitality. On the office front, the market has rebounded significantly after the pandemic.
The inventory of Grade A and A+ offices reaches approximately 7.4 to 8.2 million m², with vacancy declining to around 18-19%, the lowest since 2020. Net demand increased by over 80% in one year, with about 175,000 m² absorbed in the first three quarters of 2025. The Polanco, Reforma, and Insurgentes corridors play a dominant role: the Central Business District (CBD) captures nearly 60% of absorption, with Polanco alone accounting for about 40% in some quarters.
Average rents for high-end offices range from $22 to $23/m²/month, potentially exceeding $40 in the most prestigious areas. Meanwhile, plug-and-play spaces (fitted and sometimes furnished) now account for nearly half of the Grade A and A+ supply, a direct adaptation to the widespread adoption of hybrid work.
The city also stands out for its exceptional concentration of tech jobs (about 320,000), which fuels demand for quality, flexible offices with ESG certifications and wellness amenities (natural light, filtered air, collaborative spaces). This supports investment in iconic office towers and mixed-use projects integrating retail, housing, and services.
Nuevo León and Monterrey: showcase of industrial nearshoring
The north of the country, particularly the state of Nuevo León and the Monterrey metropolitan area, is the epicenter of the industrial relocation movement. The state attracts a significant share of new production projects, especially in automotive, electronics, and logistics, and concentrates about 40% of nearshoring projects identified in some analyses.
Industrial parks in the region boast exceptional occupancy rates, often above 97-98%. This market tension is confirmed by gross absorption of approximately 15 million square feet of industrial space in 2024. This strong demand is driving significant rent increases and growing interest from institutional investors in local industrial real estate assets.
Two iconic tower projects, Rise Tower (nearly 475 meters high) and Sohl Tower (over 260 meters), illustrate the upscaling of the office and residential market in Monterrey, now considered a full-fledged international business hub.
Querétaro and the Bajío: data centers, urban diversity, and upscaling
The Bajío region (Querétaro, Aguascalientes, Guanajuato, San Luis Potosí) is one of the most dynamic territories in the country. Querétaro in particular records the fastest growth in the commercial real estate market, with an annual rate close to 7.3%.
This is the percentage of the country’s installed data center capacity concentrated in this area.
The proximity of these digital campuses confers a “digital adjacency” premium on surrounding land and buildings. For an investor, targeting commercial assets (offices, business hotels, service retail) within the perimeter of these tech hubs is an increasingly sought-after strategy.
Border states and secondary cities: the new frontiers
Border states (Nuevo León, Baja California, Chihuahua, Coahuila, Tamaulipas) remain the backbone of cross-border trade with the United States. Freight flows regularly exceed 25,000 monthly commercial movements between the two countries, and some points like Laredo–Nuevo Laredo alone concentrate up to 85% of crossings for a major logistics operator.
Meanwhile, numerous secondary cities such as Mérida, León, or certain regional capitals are becoming prime investment targets. They combine population growth, infrastructure improvements, and less competitive pressure, allowing investors to still buy or develop at attractive price levels while benefiting from the expansion of logistics networks, roads, or railways (Tren Maya, Tehuantepec Isthmus Interoceanic Corridor, highway modernization).
FIBRAs: the listed arm of Mexican commercial real estate
It is impossible to discuss investing in commercial real estate in Mexico without mentioning the FIBRAs, the local equivalent of REITs. These real estate investment trusts (Fideicomisos de Inversión en Bienes Raíces) allow investors, both local and foreign, to access diversified portfolios of offices, logistics parks, shopping centers, or hotels, without directly managing the assets or tying up significant capital in a single project.
Collectively, FIBRAs represent about 4% of the total market capitalization of the Mexican Stock Exchange and manage more than 890 billion pesos in assets, or over 30 million m² of leasable space (with an average occupancy rate of about 95%). Their stock market performance has been spectacular: the S&P/BMV FIBRAS index shows a cumulative appreciation of around 175% over fourteen years, well above the general stock market index, with total returns close to 15% on average over recent observed years.
Main vehicles and sector positioning
The major names are now well identified:
Presentation of the main players in the FIBRA (Fideicomisos de Infraestructura y Bienes Raíces) market in Mexico, with their specializations and key characteristics.
Pioneer and largest player in the market, with nearly a quarter market share and over 600 assets across all segments (industrial, office, retail). Owns icons like Torre Mayor in Mexico City.
Pure industrial and logistics player, with about 8.1 million m² of leasable space. It is the largest industrial FIBRA in the country.
Mixed portfolio focused on industrial and retail, with over 240 industrial assets and about twenty shopping centers spread across some twenty cities.
Specialized in upscale shopping centers and mixed-use projects (e.g., Toreo Parque Central, Parque Las Antenas).
FIBRAs focused on tourism and business travel assets under international brands.
Their model requires investing at least 70% of funds in real estate or related debt, with the remainder placed in government securities or debt funds. Cash distributions (often the bulk of long-term returns, around 80%) add to the potential capital gains from the certificates (CBFIs).
Here is a summary overview of this segment:
| FIBRA Indicator | Indicative value |
|---|---|
| Assets under management (all FIBRAs) | > 891 billion MXN |
| Total leasable area (GLA) | ~30.5 million m² |
| Number of properties | > 2,000 |
| Average occupancy rate | ~95% |
| Weight in stock market capitalization (BMV) | ~4% |
| Cumulative appreciation of FIBRA index (14 years) | ~175% |
| Average return last three years (index) | ~15% / year |
For a foreign investor, FIBRAs offer several advantages: relative liquidity, geographic and sector diversification, professional management, a specific tax regime, and, for many industrial leases, indexation or denomination in dollars which mitigates currency risk.
Performance example: Fibra Macquarie
Recent publications from some FIBRAs illustrate the momentum. Fibra Macquarie, for example, recorded a record NOI of about $59 million in the third quarter of 2025, up more than 4% year-over-year, and increased its distribution per certificate by nearly 17% over the same period. Industrial rents per m² rose about 6 to 7% in dollars, while the consolidated occupancy rate hovered around 95%.
Beyond operational performance, these vehicles are increasingly adopting ESG strategies, with a growing share of their debt tied to sustainability criteria, high GRESB scores, and a portfolio of certified assets (LEED, EDGE, etc.). This trend makes them more attractive to international institutional investors seeking returns and a sustainable profile.
Legal framework: how does a foreigner invest in commercial real estate?
Mexico has a relatively permissive Foreign Investment Law. Generally, a non-Mexican investor can freely participate in the capital of local companies, acquire real estate assets, and establish businesses, with the exception of a few regulated sectors (domestic air transport, certain financial services, strategic activities, etc.).
Land ownership and the “restricted zone”
The key point to master for real estate is the distinction between the “restricted zone” and the rest of the territory, as defined by the Constitution and implementing laws.
Outside the restricted zone (100 km from borders, 50 km from coasts), a foreigner can acquire real estate in full ownership, provided they obtain a permit from the Ministry of Foreign Affairs (SRE) and sign a “Calvo” clause, waiving diplomatic protection of their home country for that property. Within the restricted zone, direct ownership by a foreigner is prohibited.
In this latter scenario, the key mechanism is the fideicomiso: a real estate trust where a Mexican bank holds the property title as trustee, and the foreign investor is the beneficiary. The trust is typically established for 50 years, renewable, with extensive rights of use, leasing, assignment, and inheritance. For many commercial projects on the coast (hotels, retail, mixed-use complexes), this structure is the norm.
Mexican companies without a foreigner exclusion clause can acquire properties in the restricted zone for non-residential use (commercial, industrial, tourist, agricultural) in direct ownership. This acquisition is subject to the obligation to notify the SRE (Secretariat of Foreign Relations) within a specified period. This structure is commonly used for investments in commercial, hotel, industrial, or office real estate in coastal or border areas.
Companies, registries, and obligations
On the corporate side, an investor can create a Mexican corporation (e.g., a S. de R.L. or a S.A.P.I.) wholly owned by foreigners to hold their commercial assets. They must include in the bylaws either a foreigner exclusion clause or acceptance of the Calvo clause, then register the company, and if applicable, the fideicomisos, with the National Registry of Foreign Investments.
Certain formalities come with implicit deadlines: applications for corporate name authorization must be processed within two business days, permits for real estate trusts in the restricted zone within a few days to a month depending on the channel, failing which they are deemed granted. This system of “positive silence” secures timelines for investors.
Taxation and transaction costs: what a business plan must include
The attractiveness of Mexican commercial real estate also lies in a relatively predictable cost and tax structure, even if it is not negligible.
Acquisition, holding, disposal: main taxes
At acquisition, the buyer generally bears: notary fees, registration rights, and various ancillary costs.
– A local real estate acquisition tax (ISAI) typically between 2 and 3.5% of the property value.
– Notary and registry fees often below 1%.
– The costs of setting up a fideicomiso if needed (several hundred dollars in opening fees, along with annual fees of a similar magnitude).
Moderate rate of the local property tax (predial) on the cadastral value of an asset in operation in Mexico.
Regarding income, rents paid to a foreign owner are generally subject to a 25% withholding tax on the gross amount, without deductions, unless the investor opts for a more sophisticated regime via a local entity allowing deduction of expenses and depreciation (with a 30% tax on net profit).
When reselling a property in Mexico, the capital gain is taxable under two possible regimes: either at a rate of 25% on the gross sale price, or at a rate of 30% on the net gain, subject to meeting certain conditions. It is crucial to note that double taxation treaties signed by Mexico with many countries can significantly reduce this tax for foreign investors from those partner countries. Analyzing the most advantageous regime and treaty benefits is therefore an essential step in tax planning.
VAT, land transfers, and construction
Raw land is generally not subject to VAT, which benefits land investors. However, construction or improvements are taxed at 16%, with few exceptions for primarily residential housing. Portfolio transfers, hotel developments, or logistics parks must clearly incorporate this cost into their projections.
For an investor contributing a real estate asset to a FIBRA, the transaction is generally taxable, but the tax can be deferred if certain requirements are met, allowing assets to be pooled within a listed vehicle without immediate tax friction.
Promising segments: industrial, office, hospitality, and mixed-use
Not all commercial real estate segments are progressing at the same pace. However, data shows that four major families stand out.
Industrial-logistics and warehouses: the strongest block
As we have seen, the nearshoring + e‑commerce combination makes industrial-logistics the undisputed champion of growth. The Mexican warehouse market is estimated at over $43 billion in revenue in 2024, with a projection of over $70 billion by 2030, a growth rate of around 8 to 9% per year depending on the source.
Most warehouses are still non-refrigerated, but cold storage logistics is developing rapidly, driven by agri-food, pharma, and large retail. Temperature-controlled warehouses show a growth trajectory around 5% per year, higher than the rest of the market.
Industrial rents have increased by about 50% in five years in some markets, partly due to rising construction costs.
Offices: a recovering market, but more selective
The office market, hard hit by remote work during the pandemic, is entering a phase of stabilization with a marked return of companies to hybrid models requiring three days a week in the office or more for the majority of employees. In Mexico City, a study indicates that nearly eight out of ten companies already operate on this model, and over 85% plan to increase their occupied space in the next three years.
The dynamics are however very localized: prime corridors like Polanco, Reforma, and Insurgentes show sustained demand and significant vacancy declines (up to 3 to 8 percentage points depending on the neighborhood), while peripheral areas like Santa Fe remain in a catch-up phase. New supply is slowing sharply: the pipeline under construction represents less than a third of pre-2019 volumes, limiting the risk of oversupply in the medium term.
For an investor, this configuration favors well-located assets, recently built, with environmental certifications and modern amenities. Conversely, obsolete, poorly served, or energy-intensive buildings see their relative value erode, leading to a trend of conversion to other uses (residential, healthcare, education) for some of the space.
Hospitality and tourism retail: the tourism locomotive
The recovery of Mexican tourism is another pillar of the appeal of commercial real estate. The hotel sector weighs nearly $58 billion and could approach $82 billion by the end of the decade, with annual growth around 6%. International tourist arrivals have exceeded 45 million visitors, with revenues of over $15 billion in a half-year period in some recent years. Beach destinations like Cancun, Riviera Maya, Los Cabos, Puerto Vallarta, and Playa del Carmen show occupancy rates sometimes above 80% in high season.
This is the number of hotel rooms currently under construction in France, illustrating the continuous growth of the hotel inventory.
The rise of branded hotel residences and hybrid products (aparthotels, high-end coliving, offers for “digital nomads”) completes the picture. These projects, often backed by 5-star resorts, improve overall profitability by combining recurring co-ownership income and hotel operations.
Mixed-use projects and sustainable development: the new norm
A cross-cutting trend now permeates all of Mexican commercial real estate: the rise of mixed-use projects and environmental certifications. Major developers are increasingly combining offices, retail, housing, hospitality, and green spaces in a single complex to reduce risk and meet the demand for integrated urban environments.
Mexico has more than 5 million square meters of EDGE-certified buildings, placing it in the top 10 globally of the US Green Building Council.
Beyond image, these certifications have a measurable economic impact: studies show operating and maintenance cost reductions of around 20%, rent premiums that can exceed 10%, and increased asset valuation. For investors, they also provide access to green financing (green bonds, ESG-linked loans, “green” mortgages) with more favorable terms.
Returns, risks, and trade-offs: how to read the Mexican market
On paper, the gross yield figures – around 7 to 10% for industrial, 6 to 8% for well-managed prime offices, often more for certain hotel or commercial assets in tourist resorts – are attractive, especially when compared to other major economies. But these returns come with a range of risks that must be lucidly assessed.
Macro and financial risks
The Mexican monetary context remains demanding: the central bank maintains a relatively restrictive policy, with high benchmark rates, resulting in significant borrowing costs – mortgage rates hover around 10% in the most recent data. This increases the cost of leverage for developers and limits access to credit in some segments (particularly residential), even if institutional investors often have more favorable conditions through bond or international financing.
On the regulatory side, delays in zoning and permit approvals – especially in the Mexico City metropolitan area where they can reach 12 to 18 months – increase cost and schedule risks. Inflation in construction materials also erodes margins on new projects.
Security, infrastructure, and human capital
Some regions, especially in the north (Chihuahua, Tamaulipas, Sinaloa), suffer from security issues that worry international tenants and can hinder new project development. Cargo theft, for example, is reported to have increased by about 7% in 2024 and represents an estimated additional cost sometimes amounting to several GDP percentage points. This raises insurance premiums (up about 11% for logistics) and requires additional security investments.
Infrastructure is not always up to needs: strains on the electrical grid in some industrial states, port or border crossing congestion, saturated roads… The government has launched several massive programs (modernization of the Tehuantepec Isthmus, expansion of ports like Manzanillo, highway programs, Tren Maya) but their deployment is gradual.
The construction and logistics sectors face a critical shortage of skilled workers. For instance, there is a deficit of several tens of thousands of truck drivers. This situation can lead to significant delays on construction sites and increased project costs.
Real estate legal framework: nuances and vigilance
Even though Mexico broadly allows foreign ownership and offers proven mechanisms (fideicomisos, local companies), the land system remains declaratory: registering a title in the public registry does not alone guarantee the absence of disputes or hidden encumbrances. Land subject to the ejido regime (community property) covers more than half of the territory, and illegal or poorly structured transactions on these lands can lead to total losses.
For institutional investors, the answer is known: rigorous due diligence, systematic use of independent notaries, verification of the chain of title, review of planning permissions, title insurance when available. Legal risks are manageable, but they require a high level of professionalism.
Where are the best opportunity windows today?
By cross-referencing the main drivers – nearshoring, e‑commerce, data centers, tourism, rapid urbanization – and constraints – cost of capital, security, regulation – several investment axes clearly emerge.
1. Industrial and logistics parks in nearshoring corridors
Border areas and industrial regions in the north and Bajío offer a rare profile: minimal vacancy rates, double-digit rent growth in some markets, massive foreign direct investment flows (manufacturing alone captures about half of FDI).
Industrial parks with international standards, located near major road and rail arteries, therefore remain at the top of the list. Industrial FIBRAs like Fibra Prologis or private developers (Vesta, VYNMSA, etc.) are multiplying projects there, and average cap rates around 7.2% with unlevered returns close to 10% remain attractive for core-plus.
2. “Last mile” logistics assets in major metropolises
In Mexico City, Guadalajara, or Monterrey, urban warehouses for last-mile delivery are seeing rents soar under the effect of e‑commerce. Vacancy in the Mexico Valley, for example, has fallen to less than 1%, while nearly one million m² of warehouses are under construction to try to keep up with demand.
Existing assets with good locations, near major urban arteries and with excellent truck accessibility, present strong potential for value-add. This upside, both in rent and capital, is conditioned by upgrading to modern standards, particularly regarding ceiling height, floor quality, and safety standards.
3. Prime offices and mixed-use projects in established CBDs
In mature business districts of Mexico City (Polanco, Reforma, Insurgentes), Monterrey (Valle Oriente, Margáin–Gómez Morín), or Guadalajara (Zona Financiera), the combination of limited new supply, sustained demand from tech, financial services, and business services sectors, and a gradual return to the office creates a favorable window.
Recent, certified assets (LEED, EDGE, WELL) offering flexible platforms are well positioned. Mixed-use projects combining offices, retail, leisure, and sometimes hospitality (similar to some developments by Fibra Danhos) benefit from better resilience in case of a slowdown in a sub-segment.
4. High-end hospitality and hybrid products in tourism hubs
In premium destinations like Los Cabos, Riviera Maya, Puerto Vallarta, or Cancun, international and domestic tourism demand remains robust. 5-star hotels show occupancy rates above the national average and revenue per room sometimes comparable to, or even higher than, some US markets.
Investment opportunities lie in repositioning and modernizing existing assets (repositioning, rebranding, adding residences) as well as developing new niches: eco-resorts, wellness retreats, accommodations for digital nomads or long stays. Success in these areas, especially coastal ones, depends on mastering regulatory and environmental constraints, which are often stricter.
5. Data centers and peripheral real estate in digital hubs
Querétaro, and to a lesser extent Monterrey and Guadalajara, stand out for their concentration of data centers. The energy, connectivity, and security needs of these campuses make them heavy investments, typically reserved for specialized players. But commercial real estate nearby (offices, hotels, service retail, specialized warehouses) directly benefits from their presence.
Land with good electrical and telecom connections around these clusters is becoming scarce, generating rapid appreciation for investors who positioned themselves early.
Conclusion: a market of opportunities… for prepared investors
The investment opportunities in commercial real estate in Mexico are real, deep, and diversified. A market with sustained growth, deep integration into North American value chains, a record influx of foreign investment, rapid urbanization, and a booming tourism sector creates an environment rarely seen in a country of this size.
But this attractiveness should not overshadow the complexity of the terrain: high financing costs, administrative burdens, varying security by state, infrastructure constraints, peculiarities of the land tenure system, and the need for rigorous legal due diligence.
For investors capable of combining macroeconomic analysis, submarket expertise, and selection of assets suited to new trends (such as modern logistics, green offices, reinvented hospitality, and mixed-use projects), the Mexican commercial real estate sector offers an attractive risk/return profile. It combines high current yields, upside potential, exposure to the North American industrial rebound and global tourism growth, provided it is backed by strong local partnerships.
In other words, the market is no longer an exotic bet, but a full-fledged component of a global real estate allocation strategy, provided one enters it with method, patience, and strong professional support.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
