The Data Center Odyssey in Mexico
Its strategic location, available real estate, and skilled workforce are among the advantages that have made Mexico a hub of data center activity.
Q4 2023
With this shift in mind, organizations are embracing digital services to stay competitive in the digital age. According to Market Watch, the global data center market is set to reach a remarkable $116.43 billion by 2027, growing at an impressive rate of 14.6 percent per year. This expansion is driven by several factors, including the growing global Internet user base, the widespread adoption of cloud computing, ongoing digital transformations in businesses, and the increasing popularity of gaming culture. Furthermore, shifting our focus to Mexico, it's worth noting the promising growth of the country’s data center industry. Research and Markets predicts that Mexico's investment in the development of data centers is poised to surpass the $1 billion threshold by 2028.
Advantages of a Mexican Location
In this article, we'll explore specific components crucial for ensuring the success of a data center, all while uncovering the exceptional advantages that Mexico offers in this regard.
Research and Markets predicts that Mexico's investment in the development of data centers is poised to surpass the $1 billion threshold by 2028. 1. A Strategic Location: The selection of an optimal site is not just a minor detail; it's a game-changer for data center success. Mexico, leveraging its strategic geographical position in proximity to the United States, emerges as a beacon for data center developers. As the second-largest economy in Latin America, it not only welcomes foreign trade with open arms but also boasts particular regions that offer an idyllic backdrop for the efficient establishment and operation of data centers. For instance, Querétaro is located in an area with fewer environmental risks associated with climate events such as floods and hurricanes. In terms of seismic activity, as per FM Global, the states of Querétaro and Hidalgo are in a region with low seismic activity compared to the metropolitan area of Mexico City and the state of Mexico or even Jalisco, which face a higher risk.
2. Real Estate: Real estate plays a substantial role in supporting the data center industry. Mexico, particularly in the Bajío region — encompassing states like Querétaro, Guanajuato, Hidalgo, and a portion of the state of Mexico — offers ample land options. These areas feature expansive land plots, green spaces, level terrains, and pre-built industrial facilities. Querétaro offers abundant land for development and industrial parks with competitive territorial reserves. According to Cushman & Wakefield's Market Research team, there are 486,000 square meters of industrial buildings under construction, with leasing and selling prices up to 20 percent below the national average. Querétaro and its surrounding areas account for over 50 percent of the nearly 350,000 square meters of operating or under-construction data centers in Mexico. This creates a virtuous circle of activity and interest in the city.
Querétaro and its surrounding areas account for over 50 percent of the nearly 350,000 square meters of operating or under-construction data centers in Mexico. 3. Skilled Workforce: Jalisco, Guanajuato, and Querétaro shine when it comes to having a skilled workforce. These regions have robust educational infrastructure, rare labor strike occurrences, and a workforce with a strong focus on manufacturing. For example, in Guadalajara, manufacturing employment makes up 27 percent of the economically active population, while in Queretaro, it nearly reaches 30 percent. Additionally, these regions exhibit high percentages (9 percent and 10 percent) of IMMEX-export activities, which contribute to a pool of talent aligned with international standards and possessing strong English proficiency. Notably, in Querétaro, approximately 11.47 out of every 100 residents are bilingual, fluent in both Spanish and English.
4. Job Opportunities and Salaries: The growing data center industry in Mexico is creating more job opportunities, especially in technology-focused roles. Salaries in this sector often surpass those in manufacturing or distribution, particularly for operational positions.
For example, roles associated with the physical infrastructure of a data center typically command an average of $40,000 MXN. Lower-level roles may fall in the range of $20,000 to $30,000 MXN, while managerial or leadership positions can reach between $40,000 to $50,000 MXN. For roles requiring proficiency in English, salaries can soar up to $80,000 MXN, with leadership positions potentially reaching $100,000 MXN. However, salary variations can occur based on specific projects, solutions, and client needs. Consumer-focused roles, for example, often offer higher salaries because they work with specialized data algorithms aimed at enhancing revenue and profit generation, predicting sales and consumption patterns, and providing product recommendations based on consumer profiles and preferences, along with promotional algorithms.
The growing data center industry in Mexico is creating more job opportunities, especially in technology-focused roles. 5. Security: Security is a critical consideration for international companies, especially when relocating top-tier executives. To assess this aspect, Cushman & Wakefield’s Location Strategy Assessments use a crime index, drawing from various data sources including travel advisories from the U.S. Department of State, the Mexico Peace Index, and the Security Perception Index detailed in the National Urban Public Security Survey conducted by INEGI. Notably, Querétaro stands out as a favorable choice, surpassing other options in terms of security, including Mexico City and Guadalajara.
In summary, Mexico's data center industry is on the cusp of extraordinary expansion, fueled by the increasing adoption of cutting-edge technologies like cloud computing, coupled with the flourishing digital economy. It's essential to highlight the critical role played by the electrical infrastructure's capacity, which has the potential to significantly impact this growth. Nevertheless, the region's forward momentum is accelerated by prominent industry giants such as Amazon Web Services, Oracle, Microsoft, OData, KIO Networks, and the prospect of Google's participation, all actively collaborating to drive economic impact and ultimately solidify Mexico’s position as a prominent technological hub.
Project Announcements
SpaceFactory Establishes Huntsville, Alabama, Operations
11/22/2024
Google Plans Dorchester County, South Carolina, Data Center Operations
10/04/2024
5C Data Centers Plans Phoenix, Arizona, Operations
09/23/2024
Meta Plans Aiken County, South Carolina, Data Center Operations
09/02/2024
Liebherr Mining Equipment Expands Newport News-Hampton, Virginia, Operations
06/28/2024
Microsoft Plans La Porte, Indiana, Data Center
06/06/2024
Most Read
-
How Automation Is Actually Closing the Labor Gap
Q4 2024
-
Top States for Doing Business in 2024: A Continued Legacy of Excellence
Q3 2024
-
The Role of Rail in Industrial Development
Q4 2024
-
Hydrogen Industry in Canada: A Global Leader in the Clean Energy Revolution
Q3 2024
-
Exploring the Dynamic Landscape of Industrial Packaging Solutions
Q3 2024
-
Which AI Tools Work for Job Recruiters?
Q3 2024
-
Permitted Power Capacity Foreshadows Health of Regional Economies
Q3 2024