TAG Industrial Watch: July 8, 2023

Since the reopening of the economy, there has been much talk about American companies bringing back manufacturing to the U.S. from Eastern nations such as China in order to avoid complications in supply chains. However, with annual industrial production in the U.S. still at the same level today as five years ago ($4.2 trillion), this “onshoring” movement has failed to make an impact thus far (Federal Reserve Economic Research). On the other hand, “nearshoring” is already showing up in trade data as Mexico overtakes China as America’s top importer (Commercial Property Executive).

Thanks to an influx of imports, industrial real estate in cities along the Mexico-American border (particularly in Texas) is holding up well even as the overall industrial market falls into recession. For example, the vacancy rate among small industrial properties (10,000 – 50,000 sf) sat at only 2.9% in El Paso, 2.0% in McAllen, and just 0.4% in Laredo (CoStar). Of course, more imports from Mexico equals bigger trade deficits and greater dependence on our trading partner to the south. While this will likely become problematic given Mexico’s interest in joining the BRICS coalition, industrial landlords along the border will certainly benefit in the meantime.

I N D U S T R I A L   N E W S

A Closer Look At Onshoring’s Impact On The Industrial Sector
GlobeSt.com – July 5, 2023
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Nearshoring Is Boosting Supply Chain Resilience
Commercial Property Executive – July 4, 2023
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BRICS: What Happens if Mexico Joins The Alliance?
Watcher.Guru – June 1, 2023
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BREIT Still Restricting Withdrawals, Although Receiving Fewer Requests At $3.8B
Bisnow – July 5, 2023
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Industrial Outdoor Storage Rises In Popularity Among Institutional Investors
WealthManagement.com – July 3, 2023
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R E G I O N A L   N E W S

Trade-Critical Warehouse On Texas-Mexico Border Sells For $9.1 Million
REJournals – June 27, 2023
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MDH Secures $90M Loan For Houston Industrial Acquisition
Connect CRE – June 20, 2023
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Denver Industrial Leaders See ‘Calmer, More Rational’ Market Ahead
Bisnow – June 8, 2023
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CapRock To Build 500 KSF Inland Empire Project
Commercial Property Executive – June 15, 2023
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Developer Explores Revival Of Office-To-Industrial Plan For Baxter’s HQ Near Chicago
CoStar – July 5, 2023
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