Brazil's Industrial Inventory Up 13% in 2022: Surprising Regional Trends Uncovered
- Brasil achieved 23,5 millions sqm of inventory of industrial properties by December 2022
In 2022, Brazil's Southeast region, commonly referred to as the country's economic hub, recorded the highest delivery of industrial inventory, with an additional 2.1 million square meters. As of Q4 2022, the region boasts over 17.4 million square meters of existing stock. This region includes major cities such as Sao Paulo, Rio de Janeiro, and Belo Horizonte all of which are vital contributors to Brazil's economy.
In comparison, the South region, which includes Parana, Rio Grande do Sul, and Santa Catarina, added 206,000 square meters to its industrial inventory, ending with a total of 2.3 million square meters. The traditionally less developed Northeast region, which encompasses Ceará, Pernambuco, Bahia, and other states, recorded a record-breaking delivery of over 333,000 square meters throughout the year. This significant delivery in the Northeast increased its total inventory to 2.4 million square meters, surpassing the South region inventory for the first time on record.
The record-breaking Northeast region's new inventory is surprising given historically, the Southeast and South regions have been the primary recipients of new industrial inventory due to their more developed economies. The increased development in the Northeast region can be attributed to the decentralization of industrial demand due to the global pandemic and increased accessibility of online banking fueling e-commerce growth in the region.
Giancarlo Nicastro, CEO of SiiLA, predicts that the trend of logistics decentralization in Brazil will continue to gain momentum. He explains that “the COVID-19 pandemic led to increasing land costs, mainly within a 30 km radius of São Paulo, which in turn led to major e-commerce players, such as Mercado Livre and Amazon, taking advantage of the increased penetration of online banking in more remote regions to get closer to their target consumers.” Nicastro's insights highlight how the pandemic has caused a shift towards decentralization and has led to new growth opportunities in previously overlooked regions.
