Market Trends of Latin America Coworking Spaces Industry
Growth of Coworking Spaces Market in Mexico
The market has been better positioned in recent quarters. However, with the new work modes, some businesses are attempting to reintroduce their workers in a more beneficial and practical manner. Thus, flexible workspaces are a corporate workplace approach. Coworking spaces first appeared in Mexico in 2009. They were popular among SMEs, freelancers, and entrepreneurs who needed a more beneficial and practically corporate appearance. Mexico's urban centers, such as Mexico City, Monterrey, and Guadalajara, remained major economic hubs with a high demand for office spaces. These cities continued to attract businesses and startups seeking access to a skilled workforce and various industries.
Certain areas within major cities, such as Mexico City's "Corredor Tecnológico" (Technology Corridor), have emerged as tech and innovation hubs, leading to increased demand for office spaces in those regions. The total inventory of Class A offices in Mexico City surpassed 7.5 million square meters in finished buildings at the end of 2022. The inventory has increased again and ended the first half of the year with 7.8 million square meters. Over the following two years, a massive pipeline of 483,288 square meters is anticipated to be delivered. Nowadays, there are over 100 business center spaces in the Mexico City metropolitan area, mainly in the Polanco, Reforma, and Insurgentes submarkets. Further, new companies are offering this service.
This will result in an approximately 6% increase in current stock. However, these structures are progressing slower than in previous years when the market was more active. The vacancy rate of office space is likely to fall compared to the last two years when the market experienced an unexpected return of space due to the introduction of hybrid work models and the home office. Market activity is likely to go up.
Growing Startups in Latin America boosting the market
Many countries in Latin America have achieved greater economic and political stability in recent years. This has encouraged local and foreign investors to explore opportunities in the region, leading to increased funding and support for startups. The startup culture in Latin America has evolved, with more young entrepreneurs and professionals opting to start their businesses rather than pursuing traditional career paths. This cultural shift has contributed to the growth of startup activity in the region. Several Latin American governments have recognized the potential of startups as engines of economic growth and have introduced initiatives and programs to support entrepreneurship. These include tax incentives, grants, and startup incubators.
Startups in Latin America have been gaining momentum in recent years, with several countries in the region fostering their growth through supportive public policies and investment. Chile, Colombia, Mexico, and Peru are examples of Latin American nations that have put policies in place to encourage the development and growth of startups. These rules combine support services and new technologies like co-working spaces and crowdfunding with finance plans. Brazil, in particular, has drawn significant venture capital investment. Brazil had 375 venture capital investment rounds for USD 3.1 billion in the first half of 2022. Significant investments have also been made in Chile and other nations, with businesses like Xepelin receiving a USD 111 million Series B fundraising round.
