Please wait, authorizing ...

Don't have an account? Register here today.


Signs of recovery in the Latin American office market


Latin America. This market went from half a million negative at the end of 2021 to about 100 thousand m² in the first half of 2022. In addition, among the nine cities analyzed, inventory increased by more than 300,000 m², exceeding 25 million square meters of Class A spaces, according to a report by Newmark.

This is clear from the regional market report for the first half of the current year, prepared by the different teams of newmark's Market Research division led by Juan Flores, and highlights that, despite global uncertainty, the office market in the Latin American region is showing positive signs.

"Throughout the post-pandemic period we have observed that companies are waiting for the economic and political indicators that have occurred in the region, but without ceasing to evolve, which gives us encouraging numbers and where the hybrid work model continues to have an important presence", said Giovanni D'Agostino, president in Mexico and regional director for Latin America of Newmark.

He added that an example of the above is perceived in the rental price of corporate spaces that increased by 2.1%, on average, closing the semester at 18.63 USD/m²/month.

- Publicidad -

The nine markets that Newmark monitors resulted during the first half of 2022, as follows:

Buenos Aires, Argentina
Although the recent changes in the economic cabinet have aggravated the general situation, the market shows some stabilization in its indicators, while still being expectant about the economic, political and social future of the country. During this period, companies expanded their search to new locations, driving the development of new poles of attraction, both inside and outside the CBD zone. This has accelerated the process of change in the more traditional areas of the market.

Rio de Janeiro, Brazil
The recovery of the Brazilian economy proved to be more solid than estimated and the indicators were higher than those of the first quarter and, despite the fact that there was a reduction in the volume of transactions and the vacancy of some spaces still in process, the performance of the Class A office market in this market continues with a discreet pace in this first semester. The availability rate remains stable but high at 35.37%, compared to 35.45% in the first quarter of the year. Although low, the activity of new occupations exceeded that of unemployment in most corridors of this important city.

Sao Paulo, Brazil
Most of the productive sectors had a positive performance and in May the level of activity increased by 1.2% in the industrial sector, 0.6% in trade and 0.3% in services. The expectation of GDP growth in the second quarter has been reinforced by new incentives aimed at household consumption and improvements in the agriculture and mining sectors, in contrast to the falls at the beginning of the year, so there was a decrease in the number of transactions in the second quarter of the year, in addition to a reduction in gross and net absorption. Even with some vacancies in process, the occupied space increased by 16 thousand m². Net absorption is higher than a year ago, in which a total of -46 thousand m² was reported. The service sector stood out in new leases during the last quarter, especially the financial and insurance, technology and health sub-sectors. The availability rate closed quite stable, going from 23.84% to 23.77%.

San Jose, Costa Rica
Economic growth slowed due to national and international tension which has pressured the increase in the prices of imported raw materials, mainly energy and food that have been showing an increase since 2021. For the second quarter, the office real estate market in the Greater Metropolitan Area again showed a negative net absorption of almost 8 thousand m², raising in turn the availability rate to 22.4%, which represents 548 thousand 966 m² available. The demand has shown a clear preference for second-generation spaces with plug & play delivery models that have managed to reach very competitive prices compared to new properties in gray work. Currently, almost 100 thousand square meters are built, projecting a new increase in vacancy for the second semester.

Bogota, Colombia
After the change in the presidential regime, there are many expectations. Only the national GDP grew 8.5% in the first quarter of 2022, highlighting the activities in the trade, manufacturing and artistic sectors, which contributed 5.5 percentage points, so the country's GDP is expected to grow 6.1% in 2022 and 2.3% in 2023. The second quarter of the year continued with a moderate recovery in the office market, presenting a quarterly absorption of 12,500 m². The sector reached 30,500 m² of half-yearly absorption, well above what was registered in 2021, but still far from the usual figures in the city. The availability rate fell to 10.9% and the trend is expected to continue, causing prices to push higher. As of June 2022, the average recorded was US$18/m²/month.

Panama City, Panama
The activities that have boosted the economy this year are the construction, mining, exports, wholesale and retail trade, logistics and related activities, and the port system in general. In addition, there is good expectation regarding the recovery of the tourism sector. The added values generated by activities related to the rest of the world that presented increases were: the Panama Canal with an increase in its toll revenues by 2.6%, those related to the transit of Panamax ships by 13.2%, air transport and re-exports from the Colon Free Zone by 22.4%. Despite this panorama, the corporate market presented a conservative drop in vacancy rates to stand at 27.4%, a change that was mainly supported by the absence of new properties and a reactivation in the need for spaces by regional corporate headquarters. For the first half of the year, net absorption exceeded 15,000 m² in ready-to-occupy offices. Given the current conditions, rental prices have suffered a significant drop where the average was recorded below US$15.00 per square meter per month.

Mexico City, Mexico
Finally, after just over two years, net absorption came out of the negative numbers since the beginning of 2020. Along with this new positive net absorption, the upward trend of the availability rate has stopped, something that has not happened since the fourth quarter of 2019. The occupations took place mainly in the Polanco, Insurgentes and Norte corridors, which together reported 60% of the 119 thousand m² in the second quarter. Thus, the accumulated occupancy at the end of the first half of the year was more than 190 thousand square meters, which represented an increase of 33% compared to the same period last year.

Guadalajara, Mexico
During the second quarter of 2022, the office market presented positive numbers in its net absorptions, as well as a decrease in its availability rate. In this period, there was an increase in the starting price in almost all its corridors except for Periférico Sur. It has more than 66 thousand m² under construction distributed in the Puerta de Hierro, Plaza del Sol and Vallarta corridors. In addition, there were vacancies in almost all the corridors, totaling more than 10 thousand m². 69% of the offices available in Guadalajara are in gray construction, with prices ranging from $15.24 to $25.00 USD/m².

Monterrey, Mexico
Despite the growth of 3% (42 thousand 347 m2) of total inventory, the availability rate could remain below 26%. This is due to the absorption of 15 thousand 143 m2 in the second quarter and that continues with the growth trend since the first quarter of 2021. Currently, there are 229 thousand 750 m2 under construction, of which 70% is concentrated in the corridors of San Jerónimo (96 thousand 158 m2) and Santa María (63 thousand 511 m2).

"As can be seen, the region has not been oblivious to the economic and political uncertainty that the world is experiencing, being the main problems facing the growth of inflation, a monetary policy that will remain restrictive until the end of 2023 and the continued rise of the dollar. However, the indicators for the first half show some stabilization that makes us optimistic and allows us to expect even more positive numbers for the second half of the year", said Giovanni D'Agostino, president in Mexico and regional director for Latin America at Newmark.

Duván Chaverra Agudelo
Author: Duván Chaverra Agudelo
Jefe Editorial en Latin Press, Inc,.
Comunicador Social y Periodista con experiencia de más de 16 años en medios de comunicación. Apasionado por la tecnología y por esta industria. [email protected]

No thoughts on “Signs of recovery in the Latin American office market”

• If you're already registered, please log in first. Your email will not be published.

Leave your comment

In reply to Some User
Subscribe Here
Patrocinado por:
ConsorcioTec Logo

Entrevista a Jaime Maldonado, Presidente de Air-Con Inc

En entrevista con ACR Latinoamérica, Jaime Maldonado, Presidente de Air-Con Inc, destacó los proyectos que tiene la compañía para este año 2024, sobre todo con la transición de los nuevos refrigerantes. Además, Air-Con estará como expositor en Refriaméricas Miami, y Jaime nos habló sobre sus expectativas con el evento y lo que darán a conocer para todos los visitantes.

Webinar: Armstrong y Energía de Distrito

Por: Rafael Behar, Gerente de Apoyo de Aplicación, Armstrong Fluid Technology Los sistemas de energía de distrito se caracterizan por una o más plantas centrales que producen agua caliente, vapor y/o agua fría, que luego fluye a través de una red de tuberías aisladas para proporcionar agua caliente, calefacción y/o aire acondicionado a los edificios cercanos. Los sistemas de energía de distrito sirven a una variedad de mercados de uso final, incluidos los centros de las ciudades (distritos comerciales centrales), campus universitarios, hospitales e instalaciones de atención médica, aeropuertos, bases militares y complejos industriales. Al combinar cargas para múltiples edificios, los sistemas de energía urbana crean economías de escala que ayudan a reducir los costos de energía y permiten el uso de tecnologías de alta eficiencia. En este seminario web vamos a introducir a Armstrong Fluid Tecnología y su dirección para la energía urbana con enfoques en plantas de calefacción.

Webinar: Mejores Practicas para la Optimización de Sistemas

Importancia de la correcta automatización de plantas de agua helada con el objetivo de pasar al siguiente nivel, que es la optimización de los sistemas para obtener una mayor eficiencia energética y ahorro del costo operativo y de mantenimiento. Por: Camilo Olvera Rodríguez, Gerente de Ventas - México, ARMSTRONG FLUID TECHNOLOGY

Webinar: Enfriando el futuro: Las nuevas tendencias en refrigerantes para supermercados y almacenes Únete a nosotros en este emocionante Webinar sobre las últimas tendencias en refrigerantes para supermercados y almacenes. Descubre cómo mantener tus productos frescos de manera eficiente, mientras contribuyes a la sostenibilidad y cuidado del medio ambiente. En esta sesión, exploraremos las innovaciones más recientes en refrigerantes ambientalmente preferibles, incluyendo tecnologías avanzadas de enfriamiento. Aprenderás sobre las ventajas de adoptar estas nuevas soluciones, no solo en términos de eficiencia energética, sino también en la reducción de emisiones y el cumplimiento de regulaciones ambientales. Por: Guillermo Brandenstein, Sr Account Manager - Honeywell

Webinar: ¿Es adecuada la forma de vender en las empresas HVAC/R?

En esta presentación se tratarán puntos neurálgicos sobre cómo lograr vender sin necesidad de licitar, teniendo muy presente que el cliente no nos compre porque somos los más baratos sino porque somos su mejor opción. Por: Ing. Rolando Torrado, CEO - Rolando Torrado
Load more...

Ultimo Info-Boletin