Infrastructure and Investment: How Central Mexico Leads Industrial Growth

The nearshoring phenomenon has driven a surge in demand for industrial spaces in the country's central region, primarily in Cuautitlán, Tultitlán, and Tepotzotlán.

With limited availability, especially in this area, a pre-leasing dynamic has emerged.

Mexico City leads the region in industrial absorption, accounting for 97% of the total. The average asking price has remained stable at $0.86 per square foot per month, the highest among the four regions evaluated by Datoz. This competitive cost reflects the region's appeal to companies seeking access to key infrastructure.

One such example is Mercado Libre, which leased space in Danhos’ new industrial park in Cuautitlán, benefiting from its proximity to Felipe Ángeles International Airport (AIFA) and a railway line that optimizes logistics.

The central region's industrial inventory encompasses 230 million square feet, with a 1% quarterly growth. The availability rate increased to 4.5%, reaching 10 million square feet. However, new construction starts fell to nearly 2 million square feet, 65% of which are speculative projects, while 35% are build-to-suit developments.

The demand for spaces has prompted major companies to seek locations connected to railways, with easy access to AIFA, and offering more competitive prices. These factors have driven an industrial boom in Huehuetoca, where companies such as DHL and Inditex acquired large industrial spaces of 70,000 and 54,000 square meters, respectively.

In light of this, representatives from the governments of Hidalgo, Estado de México, and Mexico City agreed—during the Business Automotive Meeting, organized by the Metropolitan Automotive Cluster—that well-implemented public policies and regional strengths have turned central Mexico into a key driver of the country’s industrial development.

With a focus on strengthening sectors like electromobility, clean energy, and pharmaceuticals, Hidalgo, Estado de México, and Mexico City continue to position themselves as hubs for both national and foreign investment, fostering competitiveness and job creation.

For instance, Carlos Henkel, Secretary of Economic Development of Hidalgo, highlighted the state’s strategic location in central Mexico, which attracts investments with legal certainty, social peace, and stability. He emphasized that Hidalgo is among the seven most attractive states for investment in Mexico, particularly for its job creation focus.

Over the past two years, Hidalgo has recorded 88 investment projects, totaling a historic $90 billion pesos and creating 129,300 jobs in key sectors such as logistics, plastics, pharmaceuticals, railroads, manufacturing, automotive, and furniture.

Meanwhile, Arturo Palacio, Director of Investment Attraction for Sedeco CDMX, announced the creation of the InCDMX agency, a new initiative aimed at attracting foreign companies while protecting the natural environment and strengthening physical and digital infrastructure. This agency seeks to leverage nearshoring opportunities and attract talent arriving in Mexico City, driven by international companies and new job opportunities.

Palacio also noted that while the automotive industry has been vital for the capital, air quality and natural resources have encouraged diversification into other sectors. Currently, over 150 production units in heavy automotive manufacturing employ more than 30,000 people.

During his remarks, Jaime Gutiérrez, a representative of Estado de México, emphasized the state’s strengths, including its leadership in the consumer market with 17.7 million people. It ranks as the second-largest economy in the country, contributing 9.1% of the national GDP. Estado de México is also the top generator of business units with 703,920 and boasts 219 industrial parks and zones, making it a key center for the automotive industry.

Gutiérrez added that Estado de México has the country’s largest workforce, with 8.2 million employed individuals, and specialized talent in the automotive sector. In 2023, the state exported $26.76 billion USD, with 46.7% attributed to transportation equipment, supported by major automobile manufacturing plants, including Ford, Moldex, Stellantis, Daimler, and Volvo.

AIFA Development Hub

Mexico City, Estado de México, and Hidalgo

Infrastructure

• Construction of three Cablebús lines
• Improvements to AICM
• Mex-Qro-León passenger train
• Mex-Qro-GDL passenger train
• Mex-Puebla passenger train
• Naucalpan-Buenavista light rail
• Toluca-Zihuatanejo highway
• AIFA-Pachuca suburban train

Housing

• 57,845 housing actions in CDMX
• 106,949 in Estado de México
• 22,258 in Hidalgo

Health

• Strengthen public health institutions
• House-to-house health initiatives
• Primary healthcare enhancement
• La Pastora Hospital to specialize in breast cancer care
• Bienestar Pharmacy in Tultepec

Water

• Third line of the Cutzamala System
• Rehabilitation of Lake Tahuac
• Valley of Mexico Program
• Hydraulic System of the Basin
• Atoyac River
• Lerma River
• Irrigation in Tula, Alfajayucan, and San Salvador

Education

• Early childhood care linked to education
• Strengthening Estado de México’s healthcare system
• Rosario Castellanos University in Cuajimalpa

*These are just some of the most important projects.
Source: CS/CEE, June 19, 2024.