Baja california industrial real estate presentaion 012113

BAJA CALIFORNIA BAJA CALIFORNIA INDUSTRIAL REAL ESTATE

January 16 2013

Presented by JP de Kervor www.Cushwake.com (858) 220.0640

January 16, 2013

©JP de KervorAll rights reserved

REAL ESTATEIN BAJAABOUT │ABOUT │ Cushman & WakefieldCushman & Wakefield

• World’s largest Privately held commercial real estate firmg y

• 253 offices in 60 countries

• 14,000 employees worldwide

• Worldwide transaction value (2010) $766 billion (US)

• Worldwide revenue (2010) $1.04 billion (US)

• 5 offices in Mexico D.F.MonterreyMonterreyJuarezTijuanaGuadalajaraGuadalajara

• 32 brokers in Mexico

Jean‐Paul de Kervor ‐ Lic. #01037619 Director M +1 (858) 220‐0640 T +1 (858) 334‐4042 F +1 (858) 452‐ 3206

REAL ESTATEIN BAJAMEXICALI City Map │ Industrial Parks


REAL ESTATEIN BAJAMEXICALI Total Market Area│ Square Feet

Sahuaro Calafia IICalafia I518,000

3%

Sahuaro1 million

6%

Calafia II36,0000% P.I. Progreso

900,0005%

Cucapa270 000

Grupo IAMSA3.4 million

18%Grupo Maran2.1 million

11%

270,0001%

Grupo Nelson4.7 million

25%Grupo PIMSA

CPA1.3 million

7%

Grupo PIMSA4.5 million

24%


REAL ESTATEIN BAJAMEXICALI │ Vacancy

Total Available Building Inventory (Sq Ft ):Total Available Building Inventory (Sq. Ft.):2.3 Million

Total Land Inventory (Sq. Ft.):21 8 Million21.8 Million


REAL ESTATEIN BAJAMEXICALI Major TransactionsMEXICALI Major Transactions│ 2012│ 2012

Type Sector Location Size (SF)

N I t t A PIMSA I 80 000New Investment Aerospace PIMSA I 80,000

Expansion Electonics PIMSA IV 88,424

GKN

Expansion Consumables Progreso 100,000

Expansion Automotive PIMSA I 110,000

E i A C l d 164 000Expansion Aerospace Colorado 164,000


REAL ESTATEIN BAJAMEXICALI Sample AvailabilityMEXICALI Sample Availability│ 150K+│ 150K+

Industrial Park Building Available Space (SF)

Colorado Industrial Park Videocon 973,173

MAG Building 230,000

Cosmo Cosmo 420,000

ll d iDesarrollo de Activos 187,077


REAL ESTATEIN BAJAMEXICALI Sample Availability MEXICALI Sample Availability │ 150K+│ 150K+

MaranVideocon

Maran

Cosmo Accuride


REAL ESTATEIN BAJANEW Industrial Park NEW Industrial Park │ Nicoya Technology Park│ Nicoya Technology Park

Nicoya Group has a development base on 9 years of experience in International Manufacturing with world

buildings and the shelter concept "A Soft landing in Mexico"buildings and the shelter concept A Soft landing in Mexico

Nicoya’s location is perfect for the R&D Developments, Aerospace and Electronic Manufacturing.


REAL ESTATEIN BAJASAN Luis Rio ColoradoSAN Luis Rio Colorado│ Industrial Zones│ Industrial Zones

Newest Port of Entry


BAJA CALIFORNIAINDUSTRIALREAL ESTATETIJUANA│ Industrial Zones


BAJA CALIFORNIAINDUSTRIALREAL ESTATETIJUANA│ Market Overall

• Tijuana has 65 million SF of Industrial Real Estate of which 8.8 Million SF are vacant.

• Currently available: 149 buildings down from 219 Buildings 2 years ago.

d f• Vacancy Rate is at 14% down from 16% 1 year ago down from 18% 2 years ago.

Ab i i i i A 1 5 Milli SF• Absorption is positive – Approx. 1.5 Million SF were absorbed in 2012.


BAJA CALIFORNIAINDUSTRIALREAL ESTATETIJUANA│ Over 100,000 Square Feet

• 24 Available Buildings are over 100 000 SF• 24 Available Buildings are over 100,000 SF

• The largest is 429,000 SF

• Two 300,000 SF Plus buildings came on the market in 2012

• Basically no new construction, some expansions and TI’s have kept the construction industry above water.

• 1 New Industrial Park is planned.

• 3 buildings in Pacifico and one in Otay is under contract for under $20/SF.


BAJA CALIFORNIAINDUSTRIALREAL ESTATETIJUANA│ Otay Mesa Total

Class C,

72 BuildingsAve. 50k SF

101 Buildings3,637.00

101 BuildingsAve. 126k SF

Class A, 12,762.00

Class B, 5,477.00

73 Buildings73 BuildingsAve. 75k SF


BAJA CALIFORNIAINDUSTRIALREAL ESTATETIJUANA│ Otay Mesa Total SF Available

Cl A16 Buildings 8 buildings Class AClass BClass C

16 Buildings Ave. 57K SF

8 buildingsAve. 120K SF

15 BuildingsAve. 59K SF

• Of a total 2.7 million SF available in Otay, most is still Class A or B.• Biggest comp (under contract) is at less than $20/SF.


BAJA CALIFORNIAINDUSTRIALREAL ESTATEGDP PER CAPITA│ Vietnam, China, Mexico

$12,000

$10,000

$ ,

$6,000

$8,000

Vietnam

China

$4,000

$ , China

Mexico

Firing Costs

$‐

$2,000 Firing Costs

Mexico 52 Weeks

US 0

Vietnam 87$

2008 2009 2010 2011http://data.worldbank.org/indicator/NY.GDP.PCAP.CD?order=wbapi_data_value_2011+wbapi_data_value+wbapi_data_value‐last&sort=asc

Vietnam 87

China 91


BAJA CALIFORNIAINDUSTRIALREAL ESTATEBaja California│ Trends

• Medical is growing

Chi i tti i b t th A i• China is getting more expensive, but other Asian Locations will continue to provide low cost labor.

• Housing starts should start to increase and that• Housing starts should start to increase, and that should boost Maquilas (furniture, Construction Materials)

• Most Growth will be expansions by existing Maquilas– Many that do Subcontracting

• Strong Peso Continues to increase costs in Mexico


BAJA CALIFORNIAINDUSTRIALREAL ESTATEBaja California│ Conclusions

P i i i i ll i O• Prices are increasing especially in Otay.

• Users ‐ Time to buy if you can take advantage of l fi i tlow financing costs.

• Empty buildings selling for less than $20/SF but that may be overthat may be over.

• Leased buildings at 9 ‐ 10% cap for LT leased with solid US corporate guaranteewith solid US corporate guarantee.

• We expect to see 1.4 million SF of net absorption in 2013absorption in 2013.


REAL ESTATEIN BAJACushman & Wakefield Cushman & Wakefield

• Commercial Real estate services:

Macro /Micro Site Selection

Lease or purchase analysis

Facilities requirements analysis

Due diligence

Purchase and lease negotiation and closing

lValuation Services

Supply Chain optimization and consulting
