Office Outlook - Jones Lang LaSalle

Office Outlook
Northern Mexico
3Q 2012
1 Northern Mexico Office Report • 3Q 2012 Fast Facts Nuevo León
Nuevo León is the industrial leader in Mexico located in the Northeast
part of the country. Its capital, Monterrey is considered as one of the
best cities for business opportunities in Latin America. As a major
industrial city, Monterrey was ranked the number 2 to do business in
Mexico in 2005 and currently is ranked as the third best by the América
Economía magazine. With a strong steel industry, Monterrey is called
“the Pittsburgh of Mexico”. The city has prominent positions in sectors
such as steel, cement, glass, manufacturing, electronics and auto parts.
In 1999 Fortune magazine recognized Monterrey as the best city in Latin
America in which to do business.
The magazine attributes its economic wealth in part to its proximity with
the United States-Mexican border and mentions Monterrey as a significant city with economic links to the United States, recognized around the
world for its entrepreneurial character. Called also as the “The City of
Knowledge” in 2007 as it hosted the Universal Culture Forum at Parque
Fundidora. Monterrey is definitely considered one of the best cities for
business in the world.
• Nuevo León has a land area of 24,963 mi², located 140 miles South of the US border and at Meridian 100 and at the same distance from east and west US coasts.
• Population: 4.7 M (2010)
• Income per capita: $12,100 USD
• Labor force: 2.1 M people 4.7% of National
• GDP: 49 billion USD (2010) which represents 7.7% of the country’s total
• Foreign investment of 5 billion USD (2010)
• Nuevo León has access to main ports in the Pacific Ocean and Gulf of Mexico.
• Two airports: Mariano Escobedo Int Airport and Del Norte
International Airport
• Main economic sectors: manufacturing, transportation, telecommunication, construction, automotive, electronics and electric, food, steel and glass.
• Home to 30 Universities, with world class academic programs
3 Northern Mexico Office Report • 3Q 2012 Market Trends spotlight
• Final advances and building completion for projects that where in past quarters inactive.
• High vacancy rate for buildings in the Valle Oriente market due to the growing number of new buildings
• There is high demand for office space under 1000 sq.ft.
• Buildings with LEED certification attract new international clients
Market Trends 2012
• Strong demand for vertical residential concepts in the Valle, Valle Oriente and Santa Maria/San Jeronimo corridors
• First buildings with LEED certification in Valle Oriente and Valle corridors.
• Buildings with office space of 1000 sq. ft or less are in high demand
• Strong demand for 2nd generation office space.
• Development of mixed use projects (office and retail) to attract new clients
Northern Mexico Office Report • 3Q 2012 4
Property Clock
This diagram shows the real estate market
performance for Monterrey in 2012.
Peaking
Market
Falling
market
Rising
Market
Bottoming
Market
Monterrey
GARCIA
GENERAL ESCOBEDO
APODACA
SAN NICOLAS
DE LOS GARZA
SAN PEDRO
GUADALUPE
JUAREZ
SANTA CATARINA
MONTERREY
SANTIAGO
The following map shows the Monterrey metropolitan area and its municipalities.
Northern Mexico office market
The following table shows the five most important office corridors located in Monterrey and its
metropolitan area.
Submarket
Inventory
Availability
Average
Lease Rate
(usd / sq.ft )
Contry
Vacancy
Rate
Construction
2012
136,163
-
-
-
-
Centro/Obispado
1,118,555
316,513
$1.41
29%
258,334
Santa María/San Jerónimo
1,022,388
148,056
$1.72
14%
102,946
Valle
2,966,789
68,232
$1.85
2%
137,948
Valle Oriente
4,217,365
1,573,533
$1.95
37%
102,968
* In Class A+, A and B buildings. All in sq.ft.
Av. Co
nstit
erto
mb
iÛn
Morone
Av. Chapultepec
s Priet
o
. Sa
n Pe
d
Pab
lo L
iv
ric
as
mÈ
Av
.G
Av. JosÈ Vasconcelos
en
er
al
L
C
en
as
io
rd
en
ro
ug
za
.E
Av
Av. M
an
es
sA
G.
e la
tos
od
rto S
an
se
Albe
lle
Ga
rza
Sa
Club Campestre
Monterrey
da
Av.
dad
ores
Av.
s
Alf
ons
oR
eye
s
es
ey
eye
Fun
oR
oR
ns
ons
iÛn
Av. Revoluc
Santa María/ San Jerónimo
Valle
Centro/ Obispado
Valle Oriente
Contry
Alf
lfo
o Reye
s
Av.
Av
.A
Av. Alfo
ns
Pa
Valle
Ca
Calz
. De
l
ez M
orÌn
s
uci G
Ûm
celo
tuc
ro
Hu
Av.
on
nsti
uciÛn
Va
sc
Co
Av. Chapultepec
Av. Ign
acio
Av. Ricardo Marg in Zozaya
so R
ey
Calz
osÈ
Av.
evol
Av. R
Av
.J
Mier
uciÛn
Lob
o
Av. Ignacio Morones Prieto
Padre
s
Calle
re
40
Av. Antonio L.Rodriguez
Av. Benito Ju rez
La
Ordaz
Blvd. G. DÌaz
Alameda
Av. JosÈ
Mar
enz Garza
Av. AarÛn S
40
Parque
Fundidora
sT
or
a
de
arz
lle
G
lez
nes P.
Av. Ignacio Moro
Ca
nz
Av. Ve
nust
Go
Calle Arteaga
G.
Av.
l.
Gra
blo
Pa
40D
Calle IJua
n Zuazua
s
Calle Ignac
io Zaragoz
a
nte
Ìa Pino S
u rez
ge
Ignacio Ma
dero Orien
e
nza
ur
Francisco
Calle Cuauhtemoc
tu
io Can
ns
Calzada
iano Ca
rra
Rogel
.I
Av
Av. Doctor JosÈ Eleute
rio Gonz lez ì Gonzalit
osî
Corredores Mon
Blvd.
lfon
5 Northern Mexico Office Report • 3Q 2012 Av
.G
en
er
al
L
za
ro
C
Blvb
rd
en
as
.A
ca p u l c o
as
Northern Mexico Office Report • 3Q 2012 6
Main Office Corridors
Centro/Obispado
Total stock: 1,225,159 sq.ft.
Principal access: Ave. Constitución, Morones Prieto and Gonzalitos.
Economic level: middle class
This corridor includes some of the most representative monuments and places of Monterrey and its history, such as the Macroplaza, City Theater,
the Governmental Palace, Barrio Antiguo, The Monterrey Cathedral, the Contemporary Museum of Art (MARCO), the Museum of Mexican History,
the Convex Business Center, the newly Northeast Museum (MUNE) and the new restored Paseo Santa Lucía. Centro/Obispado is also a corridor
known for its medical centers, laboratories, clinics and hospitals such as the Hospital San Jose as well as for its middle class residential areas.
Old corporate buildings that are located within this corridor since previous decades make this corridor a prestigious area and new buildings, cultural
spaces and entertainment make of it a modern and high status place. Public transportation is widely available along the entire corridor. Due to the
redesigning and new infrastructure of the zone, it is giving way to new developments that raise added value.
Important Buildings: Horizontes Obispado Offices, Motomex, Urbania, Torre Meridiano , Kalos , Torre Gía, Ed. Banregio y Edificio Varzor.
Property Clock
Key market indicators
Peaking Market
Rising Market
Falling Market
Bottoming Market
M²
Total Stock 3Q 2012
113,821
1,225,159
Availability
39,214
422,096
Average asking rent (USD/ month)
$15.00
$1.41
Vacancy Rate
34%
Total Absorption
36%
Centro -Obispado
Pronóstico
Annual
Anual:
Outlook:
2011
2012
S.F.
2013
2014
2015
12-month
forecast
7 Northern Mexico Office Report • 3Q 2012 Santa María/San Jerónimo
Total stock: 1,022,388 sq. ft.
Principal access: Ave. I. Morones Prieto, Díaz Ordaz and Constitución.
Economic level: Middile and upper-middle class with future projects for vertical living space.
After the construction of the Unity Bridge, this corridor has become a very transited area where public transportation is available for those who need
to travel across the zone. Some of the amenities this corridor offers would be areas of retail or commercial centers such as Galerias Monterrey, Plaza
Real and HEB as well as internationally recognized hotels such as Hilton Garden Inn and Best Western.
Important Buildings: Oficinas en el Parque, Torre Citibank, Plaza Empresarial Monterrey and Corporativo Santa María
Property Clock
M²
Key market indicators
Peaking Market
Rising Market
Falling Market
Bottoming Market
Total Stock 3Q 2012
94,983
1,022,388
Availability
12,123
130,491
Average asking rent (USD/ month)
$19.00
$1.77
Vacancy Rate
14%
Total Absorption
30%
Santa MaríaSan Jerónimo
Outlook
Annual
Timeline:
Outlook:
2011
2012
S.F.
2013
2014
2015
12-month
forecast
Northern Mexico Office Report • 3Q 2012 8 Valle
Total stock: 2,966,789 sq. ft.
Accesos Principales: Av. Gómez Morín, Calzada del Valle and Calzada San Pedro.
Economic level: upper-middle, upper class.
Valle has excellent amenities. Located in this area are fine local and international restaurants, bar and nightclubs, high-end stores, malls and
commercial centers such as Calzada 401, Plaza 404, HEB, Palacio de Hierro, the Sierra Madre Tennis Club, Campestre Golf Club and Plaza Las
Villas. Located also in this corridor is a walk route named Paseo de los Duendes where local residents exercise. It runs through most of Valle corridor
and its commercial area. Valle’s residential area is one of the oldest of San Pedro Garza García. Office space in this corridor includes class A+, A
and B buildings.
Important Buildings: Plaza Corporativa Campestre, Torre AON, Torrealta, Torre Quimmco, Equus and Punto Central
Property Clock
Valle
Peaking Market
Rising Market
Outlook
Annual
Timeline:
Outlook:
M²
Indicadores clave del mercado
2011
Falling Market
Bottoming Market
2012
Inventario total 3Q 2012
S.F.
275,624
2,966,789
6,197
66,704
Renta promedio (USD / mes)
$20
$1.60
% de disponibilidad
2%
Absorción total
22%
Disponibilidad
2013
2014
2015
Pronóstico
12 meses
Northern Mexico Office Report • 3Q 2012 9
Valle Oriente
Total stock: 4,217,365 sq. ft.
Principal access: Ave. Lázaro Cárdenas with exits to Alfonso Reyes, Blvd. Acapulco and Eugenio Garza Sada.
Economic level: Upper class witn projects for residential and office developments.
This corridor is known as the corporate and financial zone in Monterrey which is also growing as a high level residential area including apartment
buildings. Valle Oriente hosts important international hotel chains like Quinta Real Hotel, Radisson, Safi and Camino Real as well as important
shopping centers and commercial amenities like Galerías Valle Oriente and Plaza Fiesta San Agustín, international restaurant chains, gyms, as well
as beauty and commercial stores. In addition, located in Valle Oriente are two important ITESM graduate schools: EGADE and EGAP.
Important Buildings: Torre CNCI, Torre Comercial América, Edificio Alestra, Tamayo 100, Torre Martel, Parque Corporativo Valle Oriente,
TEVO, Quadrat, VAO I, Connexity, Torres Martel, 109°28´, Torre Okto, Torre XI.
Property Clock
Key market indicators
Peaking Market
Rising Market
Falling Market
Bottoming Market
M²
Total Stock 3Q 2012
391,806
3,858,991
Availability
142,574
1,534,652
Average asking rent (USD / month)
$21
$2.04
Vacancy Rate
37%
Total Absorption
64%
Valle Oriente
Annual
Outlook
Timeline:
Outlook:
2011
2012
S.F.
2013
2014
2015
12-month
forecast
About Jones Lang LaSalle
Jones Lang LaSalle (NYSE:JLL) is a financial and professional services firm specializing in real estate. The firm offers integrated services
delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2011 global revenue
of $3.6 billion, Jones Lang LaSalle serves clients in 70 countries from more than 1,000 locations worldwide, including 200 corporate offices. The
firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 2.1 billion square feet worldwide.
LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate
with $47 billion of assets under management.
Jones Lang LaSalle - Northern Mexico
Guillermo Osio
+52 81 8153 6912
[email protected]
Jobenely Cabello
+52 81 8153 6909
[email protected]
Calzada del Valle 112 Ote,
Col. del Valle, San Pedro Garza García, NL
Mexico 66220
+52 81 8153 6900
www.joneslanglasalle.com.mx
© 2012 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.