MEXICO Law and Practice Contributed by: Roberto Cannizzo, Carlo Cannizzo, Stefano Amato and Mauricio Moreno-Rey, Cannizzo
1. General 1.1 Main Sources of Law
1.2 Main Market Trends and Deals Over the past year, Mexico’s real estate market has faced challenges due to rising inflation and interest rates, slowing transactions in leasing, commercial acquisitions, mortgages, and con - struction. However, residential and industrial real estate have thrived, with investors seeing the sector as a safe haven. Experts predict contin - ued growth, particularly in industrial and tourism markets. Nearshoring has driven significant industrial space reconfigurations, attracting international businesses seeking supply chain efficiency. By Q3 2024, demand for industrial spaces surged to 1.7 million m², a 14% increase from the previous year. Monterrey led nearshoring-driven demand, while northern border markets accounted for 67% of commercialised spaces. The automo - tive sector dominated, comprising 38% of total demand. The Mexican Association of Private Industrial Parks (AMPIP) projects that at least 450 foreign companies will establish operations in Mexico by 2025, with industrial space vacancy rates below 1%. Foreign investment remains strong, with Mexi - co Pacific Limited announcing a USD14 billion energy project and Hyatt acquiring Playa Hotels & Resorts for USD2.6 billion. However, upcom - ing US tariffs on Canada, Mexico (25%), and China (20%) from March 2025 could impact industries and real estate. Despite these chal - lenges, Mexico’s industrial real estate market continues to expand. Impact of Disruptive Technologies New technologies are transforming Mexico’s real estate sector, with AI, blockchain, DeFi and proptech enabling new investment opportuni - ties. These innovations have expanded acqui - sition portfolios, facilitated fractional property
Mexico comprises 31 states and Mexico City. The Federal Constitution outlines the matters in which the Federal Congress is authorised to approve laws. Matters not expressly delegated to the Congress are considered reserved for each state. Consequently, the laws governing real estate and property ownership vary depend - ing on the jurisdiction in which the property is located. In corporate combinations (ie, mergers, pur - chase of shares) or trusts, typically the General Law of Commercial Companies, the Commercial Code and, in some cases, the Stock Market Law are applicable. Parties are free to choose the court with subject-matter jurisdiction, provided certain requirements are met. The main laws applicable to real estate transactions, depend - ing on the value and nature of the transaction, are as follows: • Federal Constitution; • Civil Code and tax laws of the state where the real estate is located; • Agrarian Law; • Income Tax Law and VAT Law; • Code of Commerce; • Foreign Investment Law; • General Law of Commercial Companies; • Stock Market Law; • General Law of Ecological Balance and Envi - ronmental Protection; • General Law of Securities and Credit Transac - tions; • Federal Antitrust Law; and • federal, state and municipal zoning and plan - ning provisions.
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