Aug. 20, 2019
Largely benefiting from an influx of industry and job growth since the global economic recession of the late 2000s, the economy has experienced steady growth over the last decade, which has been a boon for many of its urban centers. While the capital, Mexico City, continues to play a central role in national economic development, many of the country's secondary cities, such as Querétaro, Monterrey, Guadalajara, and Mérida, have caught the eye of real estate developers for their low property costs and business-friendly policies that make them attractive investment opportunities.
Buoyed by sustained industrial development and rising domestic and international tourism, secondary cities in Mexico have experienced exponential growth in their housing markets. Thanks to high technical skill set offered by local workers at competitive labor costs, well-positioned cities like Querétaro have drawn interest from global giants, such as Amazon, creating new opportunities for the local economy and housing developers.
With its central location between Mexico City, Guadalajara, and Monterrey, Querétaro will soon host the fourth Amazon distribution center in the country as the company seeks to develop the e-commerce market in Latin America's second-largest economy. Existing industrial parks in Querétaro have already benefited from their location on the so-called “NAFTA highway," which is considered to be a key artery for Mexican companies to receive and ship goods to the US and Canada under the agreement.
According to Hugo Mandujano, director of Investment Promotion for the State of Querétaro, development figures clearly represent growth trends in the region.
“The growth of the metropolitan area of Querétaro has increased about 42% within the past 10 years," Mandujano said in an interview with Industry Week. “Industry has grown too, increasing from 428 companies in 2003 to more than 1,300 companies by the end of 2013. That's an increase of 208% on FDI. Finally, the GDP of the state was USD12 billion in 2003, whereas today it has nearly doubled to USD24.8 billion."
Similar trends are taking place in the capital of Jalisco state, Guadalajara, which has the nation's second-largest population and GDP. Home to 40% of Mexico's information technology (IT) industry with more than 650 specialized companies generating more than 100,000 jobs, Guadalajara has been one of the brightest success stories in the development of secondary cities. Many international corporations, including Toshiba, IBM, HP, Oracle, Cisco, and Intel, have set up shop in the city thanks to its talented workforce and high connectivity to US economic hubs via some of the busiest airports in Mexico.
International investment in Guadalajara is evident in its growing skyline, where countless new buildings have been rising above shopping malls and commercial developments over the last decade. The city's light train network also continues to grow, fostering sustainable growth and more real estate opportunities for years to come.
Then there is Monterrey, which has gained a reputation as an international business hub thanks to its high-quality technical universities and support from companies like Google, which have sought to bring local entrepreneurs to the city through the Startup Grind Community initiative. Home to some of the country's largest corporations, such as CEMEX, Monterrey's population has doubled over the last 35 years, making it the third-largest urban center in Mexico, with 4.7 million residents.
The growth has been led by the industrial and manufacturing sectors, which have benefited from a high quality of life in the city, which is known for its many restaurants, cultural, and nightlife options. While some have criticized the high speed of new housing construction in Monterrey, there is a continued boom in mixed-use developments.
Finally, Mérida, the capital of Yucatán state, has attracted developers for its sustained tourism sector and popularity among both domestic and international pensioners. According to the United Nations, the city scores high on the quality of life index due to its high security, superior facilities and steady job creation, making it one of the best places to invest in residential property. Such attributes only become more attractive when one notes the price per square meter in Merida is 50% lower than in Mexico City, according to the Mexican Association of Real Estate Professionals.