LIX Maquiladora Industry Outlook Conference EL PASO, TX June 8 th, 2007
Company Profile Intermex Parques Industriales Leading Industrial Developer in the State of Chihuahua Among the top five developers in Mexico Established in 1971 + 5,000 employees Operates four business divisions: Real Estate: Industrial Parks Properties portfolio Construction Shelter Services Logistics ISO 9001:2000 Certified Over 120 Customers from 14 Countries served HIGHLIGHTS 2005 HQ Employees 70 Sales Assets US $85 MM US $400 MM
Demand is Strong
Participants Traditional Automotive Electronics Appliances Newer players Aeronautical Medical Business Process Operations (call centers + customer service centers) High Tech Centers
Electronic Manufacturing Services Flextronics (Singapore) new campus in Juarez 1.1 millon SF Purchasing Solectron for $3.6 billion Celestica may be Flextronics next target. Finland s Elcoteq (Juarez) Taiwan s Foxxcon in Juarez Jabil s expansions in Guadalajara, Reynosa and Juarez. Sanmina-SCI s new plant in Guadalajara. Epic s 2 new plants in Juarez.
OEM Automotive continuing to move from the U.S. GM s new assembly plant in San Luis Potosi. Significant expansions: Nissan in Aguascalientes. Daimler-Chrysler in Toluca in the near future. Toyota in Tijuana.
Campus (suppliers) settings not just automotive VW in Puebla. Daimler-Chrysler in Saltillo and Toluca. GM in Saltillo. Ford in Hermosillo. Electrolux Juarez 200 acres supplier park (refrigerators+washers and dryers). 3 million SF capacity 400,000 SF built or in-process. Lexmark 100 + acres 3,000 + employees 700,000 + SF. Bombardier in Queretaro 112 acres for suppliers Jet assembly facility + U.S.$50 mm aerospace technical center capacity for 2.5 m illion square foot of facilities.
Mexico s Industrial Estate Market
Tijuana, BC Market Size Land Construction Lease 51MM Ft 2 $6.50 $28.00 $5.30 BOSE (Massachussets audio speakers) renewed their lease on a 131 KSF building in Prologis?industrial park on Bellas Artes Boulevard. J. COX (Korea packaging materials) leased 60 KSF in the Valle Bonito Industrial Park. J. Cox is a Samsung supplier QUALITY CABINETS (San Diego) leased the 63 KSF former Sohnen building from Intramerica in the Pacifico Industrial Park AIO TECHNO (Japan-metal fabrication) leased the 50 KSF building formerly occupied by Helmut Kiffman on Boulevard Diaz Ordaz. ATISA (Mexico- developer) is building 20 acres of building platforms/pads for build-tosuit for lease or sale projects in the Pacifico Industrial Park. The vacant 179 KSF PANASONIC batteries building in the Pacific Industrial Park has been purchased by Verde Realty. FANOSA (Mexico- polystyrene packaging materials) leased an 80 KSF building in Atisa s Alfa II Park in Otay. DANONE (France- food products) leased a 300 KSF building and installed a bottled water plant. EVIAN is one of their brands. VERDE REALTY bought an additional 150 acres on Teran Teran Boulevard (3-5 minutes from Bellas Artes Boulevard) and will construct spec/inventory facilities and build-to-suit projects.
Mexicali Market Size Land Construction Lease 16 MM FT² $2.40 $32.00 $4.20 CERAMICA SAN LORENZO (Chile ceramic floor tile) bought 50 acres at Ejido Puebla southeast of Mexicali and began construction in January of a 500 KSF building. They will employ 200 to start; and will commence operations in the 4 th quarter of 2007 A confidential Mexican company has commited to lease a 50 KSF building for warehousing and distributing products for convenience stores in Mexicali and Tijuana GULF STREAM (U.S. airplane subassemblies) is expanding their existing 150 KSF building on Lazaro Cardenas by 40 KSF and will occupy it June. TETRAPACK (Switzerland plastic containers for milk) is expanding their 110 KSF building in the Calafia Industrial Park by 70 KSF and will occupy the expansion in August. A confidencital existing customer in the PIMSA IV Park has leased a 90 KSF spec/inventory building in the same park. PIMSA bought 30 acres (in the Colorado Industrial Development) from NIPPON ELECTRIC and will build spec buildings as well as build-to-suit projects. DAEWOO (Korea TV monitors) has suspended operations in 2 buildings (totaling 400 KSF). HONEYWELL (U.S. automotive spark plugs) leased 200 KSF in March in the vacant 550 KSF Mitsubishi building on Lazaro Cardenas Boulevard. They are targeting a September start-up in the westside facility Buildings in the 10-25 KSF range have experienced an elevated absorption rate very low rate of availability currently, Overall market vacancy rate is 7%.
Nogales Market Size Land Construction Lease 7 MM FT² $2.75 $30.00 $4.70 HORST ENGINEERING (East Hartford, Connecticut-manufacturing of precision machined components and assemblies for high technology industries) began production operations with 50 employees in a 30 KSF building under a Collectron shelter. BELDEN CDT (U.S.-electronics) bought land in the San Carlos Park on Avenida Ruiz Cortinas and built a 40 KSF facility which they occupied in January, with 400 employees. PREMIER METAL FABRICATION (U.S.- design and engineering laboratory) leased a 35 KSF building on Ruiz Cortinas. SVR PLASTIC (England-plastic recycling) leased a new 20 KSF building on the old road to Cananea and occupied it in February.
Juarez Market Size Land Construction Lease 50 MM FT² $4.00 $32.00 $4.75 - $5.25 SIEMENS (Germany electronics) leased 75 KSF in a 116 KSF multi-tenant building in the Northgate Park and occupied it in January. STEEL TECHNOLOGIES (steel fabrication) bought land in south Juarez and occupied a 107 KSF Crocsa built facility VISTEON (Van Buren Township, Michigan automotive) leased the 130 KSF Verde/Independencia II building (on Boulevard Independencia) and is expanding it to a total of 217 KSF. They occupied the expansion in May. GRAINGER leased a reconditioned, Verde-owned 17 KSF building in the Antonio J. Bermudez Park and occupied it in February; using it as a sales room. MORSE AUTOMOTIVE (U.S.) bought the 50 and 80 KSF Philips buildings in the Juarez Industrial Park. Alimentos de Bravo (Pecan processing) bought the 68 KSF former Thomson building in the Bermudez Park and occupied it in January. GENPACT (data processing) leased a 125 KSF building from Intermex (being built by Indico) on Boulevard Cuatro Siglos. PETROPAC (Mexico- manufacture of foam packing materials) has an Intermex owned 144 KSF building in-process in Intermex s Parque Sur. TOMOEGAWA (Japan photographic paper for printers and toner cartridges) expanded their 80 KSF building in the Intermex Park by 10 KSF. DAVOL SURGICAL (medical devices) expanded their 61 KSF building in the Aeropuerto Industrial Park by 130 KSF EDUMEX (3M) has built a second building, 130 KSF across the street from their other building on Ramon Rivera Lara.
Juarez DOMETIC (Sweden airconditioning units for mobile homes) leased 107 KSF in a Verde owned building in the Aeropuerto Industrial Park and occupied it in January. ELECTROLUX (Sweden refrigerators and washers/dryers) leased a 100 KSF spec building in Intermex s Parque Sur in January and is using it as a warehouse. CARDINAL HEALTH (U.S. medical devices) expanded their 175 KSF building on Santiago Troncoso by 150 KSF and occupied the expansion in May. JORSA (Mexico logistics) leased the 180 KSF Prologis/PPI-3 spec building in the Prologis Independencia Park in April. ONTARIO DIE (Canada tool and die repair) moved from a 10 KSF building into a 24 KSF build-to-suit-to-lease facility in the Bermudez Park. ELECTROLUX (Sweden front load washers and dryers) is having COPACHISA build a 904 KSF facility next to their 1 million SF refrigerator facility in south Juarez. LEXMARK (Kentucky laser printer cartridges) is building their 4th facility in their campus in south Juarez a 141 KSF facility. Their campus now has more than 700 KSF of facilities ETHICON (Johnson & Johnson medical devices) is building a 188 KSF building on Independencia Boulevard to complement the 300 KSF facility they already occupy. FLEXTRONICS (electronics manufacturing services) is building a 646 KSF facility in their south Juarez campus, next to the 443 KSF facility they built in 2006.
Acuña/Piedras Negras Market Size Land Construction Lease 6MM Ft² $1.70 2.30 $30.00 $4.90 A confidential Korean automotive parts company leased a 68 KSF building in the Amistad Industrial Park in Piedras Negras and occupied it in May, starting their operations with 200 employees. N.A.F.T.A (U.S.- warehousing/ distribution of electronics) leased a 25 KSF building in Amistad s Industrial Park in Acuña and started operations in January with 10 employees
Nuevo Laredo Market Size Land Construction Lease 8 MM FT² $2.30-$3.25 $30.00 $5.00 FINSA (Mexico) has filled up the 180 KSF building INTRAMERICA acquired from them. PRADCO (fishing equipment, lures, etc. and other sporting goods) leased 50 KSF and occupied the space in April. APEGO (China office paper products) leased 75 KSF and occupied the space in April. BANABOX (Forth Worth, Texas JIT supplier of corrugated box materials) leased the remaining 55 KSF. CATERPILLAR (Peoria, Illinois remanufacturing of earthmoving and automotive assemblies) leased 140 KSF in the Oradel Park, occupying the space in March. FROMEX (an Emerson Process Management division-regulators and valves for liquid propane tanks) has an 80 KSF building and is building a new, separate 30 KSF facility. They will add 120 employees. TELEFLEX (U.S. surgical kits) is currently occupying a 208 KSF building in the Finsa Park and in January occupied the 90 KSF former GST Auto Leather building across the street.
Reynosa Market Size Land Construction Lease 27 MM FT² $2.50 $32.00 $4.90 INFINITY LOGISTICS (West Virginia) leased 75 KSF from Garza Ponce in the Villa Florida Park and occupied it in February. Their current customers are Eaton and Dulces Famosos and starting in May they will add Perlos and Nokia as customers TOTAL LOGISTICS SOLUTIONS (McAllen) leased 60 KSF from Finsa in Villa Florida in February. Their customers are Corning Cable and Panasonic STANDARD MOTOR PRODUCTS (Long Island, New York automotive aftermarket products) has a 100 KSF build-to-suit facility underway in the STIVA Park and will occupy it in June. They will grow their employment from 350 to 450. RISDON (Philadelphia containers / packaging for cosmetics) leased a 35 KSF facility in the Reynosa Industrial Park; and occupied it in March. HD ELECTRONICS (Korea electronics) is expanding their 80 KSF facility in the Reynosa Industrial Park by 30 KSF. LG is their main customer. LAIRD TECHNOLOGICS (Delaware wireless antennas, EMI telematics and thermal management systems) leased a 160 KSF Prologis spec/inventory building in the Pharr Bridge Center and occupied it in February. STONE CONTAINER (U.S. packaging materials) moved from a 30 KSF building in January into a 60 KSF build-to-suit-tolease facility in the Moll industrial area. 842 KSF in facilities are being built; 321 KSF for build-to-suit projects and 521 KSF of spec/inventory facilities are in-process. There are 2 million SF either vacant (1.6 million SF) or available to lease (many with month-to-month tenants).
Matamoros Market Size Land Construction Lease 15 MM FT² $2.30-$2.70 $33.00 $4.80-$5.25 FINSA has a letter of-intent from a confidential company (industrial doors) for 32 KSF of space in their 162 KSF multitenant building in the Finsa Oriente Park, across from the CIMA (state-owned) Park. DURA (automotive) has a 2 nd building (223 KSF) in-process in Finsa Oriente. They will occupy it in August. 3 new industrial parks are in the early stages development LAS VENTANAS Park on the Westside of town 250 acres. Andres Garcia s company (PESA) is the developer A 250 acres joint venture between Rich and Ricardo Martinez, also on the Westside. Infrastructure installations are in-process and earthwork is underway. FINSA PONIENTE 250 acres. FISHER DYNAMICS (St. Clair, Michigan metal fabrication and assembly for the automotive sector) leased a 60 KSF building from Intramerica at Finsa Oriente in a building previously leased by Milwaukee Tools. Fisher occupied the building in April; created 100 jobs and is growing. BONWORTH (U.S. textiles) had enough land beside their existing building that they entered the developer market, starting an 80 KSF spec building in January. FINSA will expand an existing confidential customer s building by 70 KSF in the Finsa Norte Park.
Saltillo Market Size Land Construction Lease 15MM Ft² $2.40 $32.00 $4.80 DELPHI (U.S. automotive) leased the 200 KSF former Champs building from Finsa in the old industrial area of Saltillo. BROWN (plastics) expanded by 39 KSF in a Corporate Properties of the Americas building in Ramos Arizpe. PELEZER DE MEXICO leased 40 KSF in Ramos Arizpe. NEALPO (Pottstown Pennsylvania automotive drive shaft assemblies) will start with 35 KSF in The Offshore Group s La Angostura Industrial Park and expects to double the building space and employ 100 workers. FOAMEX (automotive) leased a 65 KSF Amistad spec/inventory building in Ramos Arizpe. FUMER DIAGNOSTIC (automotive) leased a 54 KSF spec/inventory building in Ramos Arizpe. HUNTINGTON FOAM (U.S. appliances) signed a build-to-suit-to-lease with Amistad for a 52 KSF building in Ramos Arizpe. SPARTECH (automotive) expanded their existing building by 120 KSF in Ramos Arizpe. DESC (Mexico-plastics) signed a build-tosuit-to-lease for a 130 KSF building in Saltillo. A confidential U.K. based medical devices manufacturer has committed to an Offshore Group shelter 37 KSF in the Angostura Industrial Park. ALTO SHAAM (Menomonee Falls, Wisconsin commercial kitchen primary cooking equipment) has contracted with Offshore for 35 KSF of space in the Angostura Industrial Park. They will start in the 1 st. quarter of 2007 and expect to build their workforce to 40.
Torreon, Coahuila Market Size Land Construction Lease 10MM Ft 2 $3.00 $28.00 $4.70 LINCOLN ELECTRIC (Ohio welding machines) completed their 3 rd plant in Torreon, a 140KSF facility to make welding machine components and accessories. They invested U.S. $7.5 million in the plant and occupied it in January, creating 170 jobs. Lincoln has been operating in the Ferropuertos Industrial Park for 7 years. MONTIAC (France aluminum foundry) is expanding by 120KSF and will start operations in it in the 2 nd half of 2007. This expansion is to fulfill GM s requirement for cylinder heads. Production in the existing building has been shipped primarily to Ford. Montiac, part of the Montupet Group, has been operating in Torreon since 1999. EXCEL FOAM (polyethylene products) will occupy an existing 80KSF building in the San Pedro Industrial Park. They will grow to 75 employees during 2007. The location decision was driven by the proximity to Excel s customers in northern and northeastern Mexico. DELTA AIRLINES will begin flying a daily, non-stop flight to Los Angeles. Continental already has 2 daily flights to Houston; American Eagle once a day to DFW; Aerolitoral once a day to Juarez and AeroCalifornia daily to Los Angeles. PHOENIX INTERNATIONAL (U.S. electronic components) occupied a 120KSF spec/inventory building in the Ferropuertos Park in December. They will employ 200 people by the end of 2007 and will be producing for their sister company, John Deere, which is located beside the Phoenix International plant.
Monterrey Market Size Land Construction Lease 82MM Ft² $3.50 $35.00 $5.30 PERMACEL (labeling tapes) leased a 45 KSF Vymnsa building in La Silla Park in Apodaca and occupied it in the October/November time-frame. BRITISH AMERICAN TOBACCO leased a 100 KSF speculative/inventory building from Martel in Apodaca. BONAFONT (subsidiary of Danin bottled water) leased the 212 KSF former Solectron building from Garza Ponce in the Monterrey Industrial Park and occupied it in October. WHIRLPOOL leased a 178 KSF Prologis building in the Monterrey Industrial Park occupied it in January using it as a warehouse. CERVEZERIA CUAUHTEMOC leased a 60 KSF warehouse in Escobedo. WOOD GROUP leased Avante s 53 KSF building in the Guadalupe Industrial Park. FENCO AUTOMOTIVE leased an 87 KSF building on Avenida Juarez in Guadalupe and will occupy it in the 2 nd quarter of 2007. EAGLE GLOBAL LOGISTICS leased a 57 KSF Kalos building in Guadalupe. BOTANAS Y DERIVADOS (food warehousing and distributor) leased a 103 KSF Kalos building in Guadalupe.
Monterrey MAGNA POWER TRAIN leased a 123 KSF Finsa building in Apodaca. MARY KAY COSMETICS signed a lease for a 144 KSF build-to-suit facility in the Monterrey Business Park. They will occupy the building in the 2 nd quarter of 2007. LG (Korea appliances) leased a 67 KSF Hasna building on Agua Fria and will use it as a warehouse. PREGIS (corrugated packaging) leased a 70 KSF Prologis building in the Monterrey Industrial Park and occupied it in October. TECNOLOGICA DG leased a 26 KSF building in Almacentro on Miguel Aleman in Apodaca. ZIMAG (metal processing) leased a 108 KSF Stiva building in Santa Catarina. COUPE EXPRESS leased a 14 KSF Kalos building in Santa Catarina. POLIESTIRENO ALFA GAMA leased 26 KSF from Finsa in Apodaca. DYNAMERICA leased 77 KSF in El Sabinal in Apodaca in the 4 th quarter of 2006.
Vacancy Rates
Industrial market prices It s a buyer s market!
Average capitalization rates
Investment portfolios Capital is a coward!!
THANK YOU! Tres Hendrix Marketing Director Intermex Industrial Parks Email: thendrix@intermex.com