29 August, 2023 | #DatozByDatoz
Several factors, such as the trade war between the United States and China, as well as the desire to be closer to the world’s largest consumer market through nearshoring, have boosted manufacturing and logistics operations by foreign companies in Mexico, primarily Asian ones.
In this context, Asian companies have been the primary buyers of industrial land in San Luis Potosí and Saltillo markets, where the highest absorption of these assets has been recorded over the last 18 months, from January 2022 to June 2023.
It is worth explaining that in Asian countries, it is more common for companies to acquire industrial land where they will establish their plants and then develop them, as opposed to the prevalent practice in the West of renting industrial facilities.
For this reason, companies such as Sanhua, Midea, Taxan, Daikin, and Himile have purchased industrial land in San Luis Potosí and Saltillo.
In the last 18 months, nearly 7 million square feet (ft2) of industrial land was sold in San Luis Potosí, of which 36% was acquired by Asian companies such as Taxan, Daikin, and Himile.
Taxan is part of the large Japanese company Kaga Electronics. Taxan manufactures board assembly products, semi-finished products, and electrical components for Japanese, European, and American customers in San Luis Potosí, Mexico. Therefore, the acquired land would be for an expansion of its current operations.
Furthermore, it was announced this week that Kaga Electronics would be building a new plant in San Luis Potosí, 2.4 times larger than its current factory, with an investment of 5,000 yen (34 million dollars). It is unknown whether this investment is through Taxan.
On the other hand, the Japanese company Daikin acquired a land parcel of over 1 million square feet. This company manufactures air conditioning units.
Himile is a Chinese company specializing in the research, development, production, and sale of rubber machinery and mold products for the automotive industry. Himile will invest approximately 42 million dollars in its new production plant in San Luis Potosí, for which it acquired land in the World Trade Center 1 (WTC) industrial park. The company estimates that it will commence operations in 2024.
In the current year alone, Saltillo has sold over 12 million square feet (ft2) of industrial land, with 80% of it being acquired by the Chinese companies Sanhua and Midea.
Sanhua is a global manufacturer of control components for the heating, air conditioning, and refrigeration industry. The company already has several plants in Ramos Arizpe submarket, so this new land acquisition would likely be part of a larger expansion plan.
The appliance manufacturer Midea will also establish its presence in Ramos Arizpe submarket, having acquired a land parcel of over 5 million square feet (ft2).