Boom in Mexico Industrial Space Prompts Finsa to Speed Up Fundraising

Amy Stillman
·2 min read
2

(Bloomberg) -- Mexico industrial park operator Finsa is accelerating fundraising to take advantage of soaring demand for industrial space in north and central Mexico.

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The company has already raised $340 million for its new Fund V, which it launched ahead of scheduled after executing a previous fund two years earlier than expected, Chief Executive Officer Sergio Arguelles said in an interview. It now aims to raise an additional $260 million by the end of March.

“Fortunately, activity in manufacturing and nearshoring has been extraordinary,” said Arguelles. That “has created a lot of demand for new industrial spaces.”

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So-called nearshoring, or the trend that has seen companies focus on investing closer to US consumer markets, has spurred the industrial property developer to invest across 12 states and seven corridors including Monterrey, Saltillo, Juarez, Tijuana-Mexicali, El Bajio, Jalisco and central Mexico.

The funds will be used to “to build inventory warehouses, and for the acquisitions of new portfolios, as well as to support investments or expansions by current tenants,” he added.

Even amid the enthusiasm, water scarcity, limited energy supply and security issues remain challenges in northern states like Nuevo Leon as more firms flock to Mexico and use up limited resources. Arguelles, who also heads industrial parks association AMPIP, has been lobbying authorities for over a year and a half to increase self-generated renewable energy from 500 kilowatts.

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Arguelles, who has met with the teams of leading presidential candidates Claudia Sheinbaum and Xochitl Galvez, said he is optimistic that both contenders in the June election are open to working closely with companies to resolve infrastructure and energy problems.

Finsa has concentrated its industrial parks on the north of the country due to the proximity to the US and large existing manufacturing and auto industries, and didn’t participate in a public bid to develop properties along a government infrastructure project called the Interoceanic Corridor, Arguelles said.

President Andres Manuel Lopez Obrador has been seeking to lure companies to the less economically developed southern region of Mexico through a corridor that aims to connect commerce from the Pacific Ocean to the Gulf of Mexico.

“The lack of infrastructure and lack of preparation are factors that have limited the growth of southern Mexico,” said Arguelles. But, “we haven’t discarded the possibility of investing in the south when there’s more interest from companies to support development there.”

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