Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Tijuana Industrial Real Estate
September 15, 2010
©Maquila Properties, Inc.
Double Dip or continued growth?
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Tijuana Market Overall• Tijuana has about 52 million SF of
Industrial Real Estate • Currently: 219 Buildings (up from 190
six months ago) available with about 9.9 Million SF (Down from 10.7 Million SF) averaging 45,000 SF
• Vacancy Rate is at 19% down from 20%
• Absorption is picking up, some are expanding again like Canyon Furniture
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
Recent Deals• Canyon Furniture – 170,000 SF $0.25/SF
– Sprinklered older Class B building on Via Rapida.
• Prime Wheel – 529,000 SF Class C purchase at $7 Million
• Techmart – 13,000 SF @ $0.36/SF NNN sublease. Class A-
• Blindajes Goldman 36,000 SF Otay Class A @ $0.30/SF
www.maquilaproperties.com(858) 551.8000
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Class size # of buildings Average size
A 2,749,478 26 105,749
B 1,799,935 35 51,427
C 1,354,410 42 32,248
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Source: Maquila Properties, Inc.
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Buildings > 100,000 SF
• 28 Buildings (up from 25 six months ago) available
• Average asking rent is $0.38 ($0.43/SF in 2007)
• Mostly newer Class A buildings• Mostly owned by institutional investors
like FINSA, CPA, GE Capital, Prologis, Verde, Prudential
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Land Prices/Construction• 1 Hectar $60/SM in El Florido (CADENA).• Prices as low as $30/SM are available in the city –
many are still asking $750/SM.• No new spec building is happening.• Rental rates and land prices are usually at least 20%
below asking. Many are renting at 60% of asking and giving free rent.
• Construction costs are about $25/SF Shell.
Baja California Real Estate ServicesSince 1988
Maquila Properties, Inc
www.maquilaproperties.com(858) 551.8000
Conclusions• IGS, Sares Realty are liquidating local assets at 12%
CAP rates or $40/SF.• The direction is slowly positive as we have stopped
the negative absorption.• Lower rents and other costs have improved Tijuana
competitiveness vis a vis Asian manufacturers• Land is coming down, Construction, not so much