Greetings, ladies and gentlemen. Welcome to the Vesta First Quarter 2025 Earnings Conference Call. At this time all participants are in listen-only mode. A question-and-answer session will follow today’s prepared remarks and as a reminder this call is being recorded. It is now my pleasure to introduce your host Fernanda Bettinger, Vesta’s Investor Relations Officer. Please go ahead.

Good morning, everyone, and welcome to our review of Vesta’s first quarter earnings results. Presenting today with me is Lorenzo Dominique Berho, Chief Executive Officer; and Juan Sottil, our Chief Financial Officer. The earnings release detailing our first quarter 2025 results was released yesterday after market closed and is available on Vesta’s IR website, along with our supplemental package. It’s important to note that on today’s call, management’s remarks and answers to your questions may contain forward-looking statements. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ. For more information on these risk factors, please review our public filings. Vesta assumes no obligation to update any forward-looking statements in the future. Additionally, note that all figures included herein were prepared in accordance with IFRS, which differ in certain significant respects from U.S. tax. All information should be read in conjunction with and is qualified in its entirety by reference to our financial statements including the notes thereto and are stated in U.S. dollars unless otherwise noted. I will now turn the call over to Lorenzo Berho.

Thank you, Fernanda. Good morning everyone and thank you for joining Vesta’s first quarter 2025 earnings call. Before we begin our review of Vesta’s results for the first quarter, I’d like to take a moment to reflect on the broader operating environment. As can be expected, uncertainty prevails. This volatility and ambiguity continue to shape and in most instances halt decision making across industries and markets, particularly around long-term commitments during the quarter. Leasing activity has slowed in Mexico as it has in the U.S. and Europe. However, while market-wide absorption has essentially paused and new leasing decisions are being delayed, Vesta’s tenants are staying while we also gained new tenants in the first quarter of the year. Most of our clients have not altered their long-term plans despite trade related headlines. Recent conversations we have had show that a substantial majority have not adjusted their investment outlook because of tariffs or regulatory risks. Vesta remains focused and disciplined. Our company has a demonstrated history of successfully weathering headwinds and the steps we have taken underscore our resilience not just in navigating through fertility, but adapting, reacting and executing with clarity in uncertain times to emerge stronger. Vesta’s competitive advantages in the Mexican industrial real estate sector are rooted in a combination of strategic positioning, operational excellence and long-term vision. Let me briefly reiterate these advantages, which are particularly relevant in today’s operating environment. First, the exceptional quality of our assets across strategic markets is a compelling differentiator with powerful client stickiness. Vesta has cultivated a diverse blue chip tenant base with long-term dollar based lease structures. This drives tenant retention with visibility into future cash flows. We are Mexico’s go to partner for global firms entering or expanding in Mexico and our company operates with prudent leverage, ample liquidity…

Thank you, Lorenzo. Good day everyone. Let me begin by summarizing our first quarter results starting with our top line. We have a solid start of the year with total revenues up 10.7% reaching $60.6 million, mainly due to rental revenues coming from new leases and inflationary adjustments on rental property during the quarter. In terms of the current mix, 89.7% of our first quarter revenues was denominated in U.S. dollars, an increase from 87.8% from the first quarter 2024. Regarding our profitability, adjusted net operating income increased 8.5% to $62.1 million, while the margin contracted 10 basis points to 95.7%. This was mainly due to higher costs during the quarter related to rental income generating properties, including real estate taxes, insurance costs, maintenance and other property related expenses. Adjusted EBITDA reached $55 million in the first quarter, a 9.3% increase compared to prior year’s quarter and the margin increased 50 basis points to 85.2% primarily due to lower expenses relative to total income during the first quarter 2025. Moreover, we maintain a strong focus on cost discipline to help and sustain profitable growth. We closed the quarter with a pre-tax income of $28.6 million compared to $150.6 million in 2024. This decrease was mainly due to lower gains on revaluation of investment properties as well as reduced interest income due to a lower average cash position during the period. Vesta FFO excluding current tax increased to $45 million this quarter from $40.4 million in the first quarter 2024, an 11.4% increase year-over-year. Moving to our capital structure and balance sheet, cash and cash equivalents stood at $49 million and our total debt decreased $801 million as of the end of March 2025. Subsequent to quarter end in April 2025, we drew down $100 million from the $345 million syndicated loan secured in December 2024, furthering strengthening our financial position. With our net debt to EBITDA at 3.2 times and a historically low loan to value of 20.6% at the closing of the first quarter, we maintain significant financial flexibility to capitalize on future opportunities as market conditions improve. Given today the dynamic environment as Loren described, we are taking decisive action to deploy capital in the best way possible to ensure the most significant shareholder return. Reiterating that Vesta’s shareholders approved US$150 million share buyback program. During the quarter, Vesta’s share repurchase program reached US$36.4 million equivalent to 15.5 million shares. We remain committed to disciplined capital allocation, opportunistically buying back shares and investing selectively in land acquisitions that supports our future growth, as Loren has noted. Finally and subsequent to quarter’s end on April 15, 2025, we paid a cash dividend for the first quarter equivalent to PS$0.41 per ordinary shares. This concludes our first quarter 2025 review. Operator, could you please open the floor for questions?

Absolutely. Ladies and gentlemen, we will now begin the Q&A Session. [Operator Instructions] Thank you. Your first question comes from the line of Pablo Ricalde with Itaú. Please go ahead.

Hi, good morning, Vesta team. Thanks for taking my question. I have a question on the leasing activity we saw on the flutter as most of it was related to renewals. I don’t know what you’re seeing like April and May in terms of leasing activity. Should we expect once again most of the leasing activity to be renewables or are you seeing finally like new tenants coming into your parks?

Hello, Pablo, thank you. Thank you very much for being on the call. Yes, we are seeing an uptick and an increase in activity coming from an increased pipeline and we believe and we expect that leasing activity for new leases and new tenants might pick up in the upcoming quarters. Having said that, it is important to mention that definitely the first quarter was a quarter of high uncertainty which made companies put their projects on pause or maybe just delay part of their decision making. And for that reason, most of the projects that we have in the pipeline and we see in the market will materialize at a later stage. Having said that, I think, that not only the value that we create is through leasing activity of new spaces, which we think will pick up, but also from the renewal activity that we see. And actually we were very active with renewals and releasing of existing spaces with existing tenants and we were positively surprised with the long-term commitments that the companies are still making. Also on our ability to mark-to-market many of these rents and therefore have an increase in weighted average lease expirations as well as leasing spreads and rent spreads. So, all in all, we think it’s positive and sets up a positive trend probably for the for the upcoming quarters. Thank you, Pablo.

Thanks. And one follow-up on that, can you remind us on your expiration curve for 2025?

Expirations for 2025 is in the low single digits. Let me try to be a little bit more specific. Give me one second. So we have 4.7% of total GLA will be expiring in 2025 still, so less than 5%.

Thaks very much.

And maybe just to follow-up, and out of the total portfolio for 2026, which in many cases we try to anticipate those renewals and companies want to make commitments in advance. Those stand currently at approximately 10% which is also a very comfortable number. Maybe also to your question to follow-up too, I think, that it’s important to mention that retention rate remains quite high above 80% which means that there is a high interest of companies not only to stay with us, but also to have a continuation and even in some cases expand operations.

Perfect.

Pleasure.

Your next question comes from the line of Rodolfo Ramos with Bradesco. Please go ahead.

Thank you Vesta team, for taking my question. I have a couple if I may. Can you give us a little bit more detail this tenant engagement that you’re having and when do you expect to see occupancy stabilizing? Should we be looking at when the USMCA review is completed? I don’t know if how those tenant engagement discussions are going. And secondly, we now have the secondary legislations in terms of energy, there are some provisions that make it easier for solar panel installations and certain self-supply schemes, I was wondering if your development team across Mexico has brought up new ideas as a result of these new rules and regulations. Thank you.

Thank you, Rodolfo. And thank you for being on the call and the questions. Well, first regarding tenant discussions, we have had a very tight engagement with existing tenants. We have a broad base of high quality tenants as well as potential tenants. As for the first ones, what we have perceived is that they have a high conviction on Mexico. The majority has a very – it’s for many companies very complicated to even analyze relocating their manufacturing facilities to other parts of the world. So, it’s basically companies analyzing the different scenarios and adapting to the different scenarios so that they can continue to be manufacturing, and producing and integrating supply chains from Mexico. Other countries are having other issues too. So sometimes we look into detail only into Mexico. But if we look in relative terms to what’s going on in other parts of the world, some of those countries that have had a manufacturing footprint too are facing even more challenges. So, with that in mind, I think, that the ability of companies being established in Mexico for many years is giving them an advantage. And hopefully now that we start getting a bit more clarity on what the new rules in terms of trade and tariffs will be, I think, that companies will quickly start making decisions. As an example, we recently, right after some of the tariffs, I would say tariff releases releasing in tariff impacts were gone immediately, we started seeing our pipeline increase of companies interested in analyzing further expansions and further space. Nevertheless, all of these companies are considering the uncertainties from that we are experiencing still coming from the tariffs. And I think that in the upcoming quarters when we start, the noise starts to dissipate. We’ll start to see more transactions. And regarding energy, definitely we define as part of our Route 2030 strategy, we did define a plan where we can establish more energy coming from solar panels, coming from renewals and sustainable energy. And we are adapting to the new regulations and the new laws which are beneficiary for us. And I think that soon throughout the year we will start to see more projects with solar panels and eventually have the objectives of the Route 2030 being met. Thank you.

Thank you, Lorenzo.

Your next question comes from the line of Alejandra Obregon with Morgan Stanley. Please go ahead.

Hi, good morning, Vesta team. Thank you for taking my question. I was sort of trying to get your pulse of things on the ground through your lens, if that’s possible. I am interested more in your existing portfolio as opposed to the new conversations and the new listings. So, if you can perhaps elaborate on how those conversations are going and more in particular, if you’re seeing any ecosystem or group within your tenants that is perhaps holding back more on the decision making, that could perhaps be thinking that they might be more – affected on the tariff front, directly or indirectly, and perhaps any other ecosystem that feels more comfortable, so to speak. Anything on the color of how tenants are behaving and your conversation with customers, that will be great. Thank you.

Great. Thank you Alejandra, for your question. Yes, I think, that it’s very important to have that communication with tenants and we’ve been having that to understand not only specifics of tenants, but also try to identify what are the trends on the certain industries, on certain regions and what might be the implications with new tariffs. Overall, we have been very – we’re very positive on what our type, our clients are experiencing. First of all, in terms of the auto industry, it is very much integrated to the U.S. and we believe that all of them have identified their impacts either with being exporting right now as most favored nation and including those tariffs as well as the ones that rely with USMCA tariff rules, both of them, we believe, or regardless of what scenario and what plant they’re using, we believe that they have great long-term plans and they will be able to solve all the tariffs issues depending on the type of production they have. So the auto industry, we believe is in good shape, particularly the type of tenants that we got. Remember that these are tenants that are either Tier 1 companies, many of them well established also in the U.S. or Tier 2 companies that have global footprints and have great relationship, many of them European companies, American companies, and have a broader relationship with the OEM. So in that regard, I think that Mexico is in a favorable position and the auto industry will continue to be competitive. Other industries are also quite strong. For example, the medical device industry, which also has a very good relationship with U.S. companies and U.S. demand as well as other industries, of course, regarding logistics and e-commerce, remember that Mercado Libre is now one of our main and most important tenant and for the structure of their business, we think that and we see that they will continue to grow as well as other e-commerce players. So all in all, we are very positive with the conversations we’ve been having. Everyone is trying to figure out and solve out. But remember that Vesta is very cautious on the type of clients we got. We revised carefully their origin. We revised carefully their track records. And for that reason that resilience will prevail not only in our portfolio with long-term leases, U.S. dollar leases, but also in the businesses of our own clients, which we think will prevail.

Got you. That was very clear. And perhaps just an additional follow-up. Especially around the Bajio, have you seen any sort of new ecosystem building around the area? Perhaps any different sort of tenant, especially around Guadalajara? Anything that you think was not there before? And of course there’s a lot of moving parts and there’s a lot of uncertainty still. But anything that you think might be building perhaps towards a more value add around IT, hardware or another ecosystem around the Bajio?

Sure. So what we have seen is an increased demand of companies in the electronics sector and technology based companies, most of them in Guadalajara. And I think that particular ecosystem will continue to grow. Actually that might happen not only in the Bajio, but also particularly in markets like Ciudad Juarez, which has also had a strong track record of companies in the electronics sector. And I think that will continue to grow and that growth might actually be actually a sharp growth. And many of these companies clearly are identity are global companies that are analyzing their alternatives and they kind of get back to Mexico and see Mexico as a strong alternative still for the production they might be having. Even that the first quarter was slow in the markets overall, slow in closings, because again, companies are taking longer to make decisions. But there’s many companies analyzing in detail and considering expansions or considering new arrivals. So we will continue to see a big shift in certain regions on certain industries. And I think that in the upcoming quarters and even for the rest of the year, there will be also some positive signs. The Bajio will continue to be a good market for logistics, e-commerce as well as the auto industry. And I think that some of the existing clients are still making long-term commitments and are considering Mexico as their main manufacturing platform for North America and to integrate their supply chains to the OEMs in North America.

Thank you, Lorenzo. That was very clear.

Your next question comes from the line of Adrian Huerta with JPMorgan. Please go ahead.

Thank you. Hi everyone, thank you for taking my question. I have just two questions, Lorenzo. First, on everything that you have just said in terms of new clients, interest, et cetera. What would you say it is the likelihood then of the greenfields that you have, let’s say in Monterrey you have two properties, they’re going to be finish in April one in – and another one in August. The likelihood of those properties to be leased this year already. That’s my first question. And the second question is we’ve seen a lot of activity on your land bank. Happy to see that. Should we expect more still for the rest of the year?

Gracias, Adrian, and thank you for your questions. Well, from – even from the last quarter and end of last year, we identified that clearly 2025 was going to be a slow year because of the uncertainty that we have perceived and that we have incorporated that scenario that the year will continue to be slow. We might get some positive news. However, our scenario said that the market will continue to be were more on the conservative side and I think that should be the approach. Nevertheless, I think that the projects that we have under development I think are very high quality buildings. I can even say that these would be the best buildings in Monterrey because of their sustainability attributes, because of their quality standards and I’ll be glad to have a tour whenever they’re done, which will be soon or even before that, so that you can see it for yourself and be able to compare. And I think that will eventually have will be a very important part of a decision for many of the companies that are analyzing space in Monterrey. Monterrey is the largest industrial market in Mexico will continue to thrive, what might have happened in the first quarter, which was a slow quarter, doesn’t mean that it will be the same going forward. So we feel comfortable that eventually those buildings will be leased actually very well leased with good companies long-term leases and keep and maintain the quality and standard of the lease agreements that Vesta has had in the past. We on the right considering some downtime for those for development of spec buildings. But even with the downtime, with even some months of downtime, we think that these are very attractive return on costs. We’re still developing at…

Understood, Lorenzo. Thank you.

Your next question comes from the line of Jorel Guilloty with Goldman Sachs. Please go ahead.

Good morning, everyone. Thank you for taking my question. I have two questions. The first one I wanted to get a sense of, you say you’re having plenty of conversations with potential tenants for your development pipeline. But I was getting – I wanted to get a sense of if you have a target of the type of tenant that you are seeking your – because for example, now you have Mary Krupski [ph] as your biggest tenant. So are you leaning more towards becoming more logistics focused? Are you looking to reduce exposure to autos? Are you looking to increase exposure to a certain type of industry? I just want to understand how much of this is push and pull. How much is your target versus what’s incoming? And then the second question is around inventory under construction in the North. So I wanted to get a sense from you how are you seeing the growth of development pipelines in cities like Juarez, Tijuana and Monterrey? Are you essentially seeing these pipelines at an industry level decline, are they maintaining? Are they increasing? So any color you can provide on the industry level would be helpful. Thank you.

Great. Gracias. Thank you, Jorel for your question. To your first question, Vesta has done a great job diversifying its portfolio in terms of industries, so that we do not rely on one particular industry too much, too heavily. I think right now auto industry for Vesta, I think, it’s only about one quarter of the total portfolio and actually that – so that’s a very healthy number. We believe it’s a – the portfolio going forward should continue to maintain this exposure in the auto industry, which will continue to thrive. I think that logistics and e-commerce is probably close to 50%, a little bit lower than 50% but will be maybe 45%. So maybe it will be still at 50% or maybe higher, let’s say 50%, 55% going forward. So we have some room to do more logistics and e-commerce and then the rest is diversified industries such as aerospace industry, medical device industry, electronic sector. So we feel very comfortable with the diversification of Vesta. So going forward and to your question on who we are targeting, every time, we develop a building, we have firsthand information on what are the industries in that region that are thriving. What are the main drivers for them to be established in that particular area? And we try to target those sectors and those industries. So we think that our selection process of clients will continue to be the same and has not changed, because we have that particular – we have it well diversified and we don’t have any material exposure to one single industry. What is very important is that we continue the discipline of having very high quality buildings with high credit rating tenants, with long-term leases in U.S. dollars and with corporate guarantees, which will enable…

Your next question comes from the line of Gordon Lee with BTG. Please go ahead.

Hi, good morning. Thank you very much for the call. Just one quick question, Loren, on the land bank, I was wondering, you bought pretty meaningful pieces of land in Monterrey and in Mexico City this year, more recently, obviously during the period of uncertainty that you’ve described affecting your tenants. And I was wondering whether that uncertainty is playing in your favor when you’re looking at land, whether that’s already prompting maybe sellers to become a little bit more motivated to sell, whether you’re seeing a little bit of an adjustment in expectations of price or whether it hasn’t really filtered to that level yet. That would be question one on the land bank. And then the second would be given sort of this, not the long-term adjustment to your expectations, but the short-term adjustment. What’s the level of land bank that you would be comfortable finishing the year with? Thank you.

Great. Thank you. Thank you, Gordon, for your question. And yes, we have been very careful in terms of land acquisitions. We have been able to close some transactions, but we have also passed on some transactions. Some landowners might be asking for very high prices still, but every now and then we find opportunities to be able to close. I think that Vesta has done a good job by my maintaining its credibility, when it comes uncertainty, when it comes to closing a transaction with a landowner. And I think that can give us some positive advantage in order to close in the right land that we want to buy at the right price, we think that we can continue to add value to our shareholders. Having said that, I think that we currently – Vesta is in a very good position because our land bank was in a very manageable number, very low value, very low – the amount of investment in land is very low compared to total assets of the company. So we think that over the year, we will continue to do some land acquisitions and without giving you an exact number, but we think that that particular number will continue to be very manageable compared to the rest of the total assets of the company. So I think that Vesta is very prudent and disciplined not to overshoot in terms of land acquisitions, but also – we don’t want to lose the opportunity to close some good transactions at moments where other competitors and other peers might be focusing in other aspects of their own strategy. I think that these are good moments to take advantage of opportunities for the companies that have long-term plans. And I think Vesta is one of those companies that have long-term plans, that know the markets well, maintain a leadership in its existing – in its regions. And for that reason, we think that we can be able to continue to close good land acquisitions that will position us better for the future.

Perfect. Thank you very much.

Question comes from the line of Andres Aguirre with GBM. Please go ahead.

Hi, Lorenzo, thanks for the call and congrats on the results. Regarding land acquisition made during the quarter, do you plan to win many developments of these properties in the near-term? Or maybe spend as part of your land usage for future projects? Thank you.

Excellent. Thank you very much for your – for being on the call, Andres, and thank you for your question. So that’s – I think that’s a – I think it’s very important what you just asked because the approach on Vesta is, we – first, we identify the markets where we want to be that are in line to our strategy. Secondly, if we buy – if we identify the land at the right price in the right location, urban infill and again adds value to our portfolio, we can do the acquisition and that’s where we are standing right now. And thirdly, we analyze in detail in the investment committee each of the transactions and the new buildings we’re going to do. So – and we analyze carefully the current situation. We analyze how demand is and we do some underwriting and do some assumptions as to when demand will pick up and how supply and competition might impact. So for that reason we are currently very – we’re being cautious, we are conservative, there’s no rush to go out and build, but there’s always an opportunity to do a lot of planning, to do a lot of internal work on the projects. We can do some good progress. And whenever we see that demand picks up, either through build-to-suits or if we lease up some of the spec buildings we have, then we can start new spec buildings. So that has been the strategy of best in the past and that will continue to be the same way. In other words, we like to drive with the accelerator and the brakes and hit the accelerator when needed, but also let go the accelerator and start hit the brakes also when needed. And right now I think it’s good moments when you have to be very strategic as to when to speed up and when to hold the brakes and try to drive with both pedals. And the investment committee looks very carefully. So eventually, when we see certain market indicators increase or improve, then we might start new buildings.

Very clear. Thank you.

And of course, we analyze market-by-market and region by region. So it’s – I think that’s what we’ve done in the past and I think it’s the right strategy. Thank you.

Your next question comes from the line of Francisco Suárez with Scotiabank. Please go ahead. Francisco Suárez: Thank you for the call. Precisely, on this question that Andres made on hitting the brakes or pushing the pedal – accelerator pedal. Do you think it is actually fair to state that in the future, the overall mix of your development pipeline will be far more towards having Build to Suit rather than spec properties as it is currently is? And the second question and actually a follow-up on one of Alexandra’s questions. It relates with this new ecosystem in Guadalajara. I mean, you already have been able to capture a lot of the market share from Foxconn. I mean and Foxconn has been some pending deals with Nvidia in Mexico, making big things in Mexico. Can you update what do you see on the ground if it’s actually Foxconn adding far more exposure or if it is one of the companies that it is also waiting a bit to push the pedal? Thank you.

Gracias. Thank you for being on the call Francisco and for your questions. So I cannot talk specifically for the plans of our clients. Nevertheless, what I can say is that the electronics sector is increasing and you have seen some of those public announcements made by some companies, and I think that that will continue. And I think that’s an interesting and very interesting sector where Vesta will continue to be close to and we’ll continue to evaluate and analyze whenever there’s an opportunity for either Build to Suit as well as to be able to lease spec buildings that will be also turning to Spec to Suit. And I think that so that will be an interesting – a very interesting sector to follow closely. Secondly, on your first question, Vesta has had a good track record of having spec building as well as build to suits or at some point as mentioned we have done a lot of Spec to Suits. Right now we believe that analyzing carefully Build to Suit is worth particularly when you have good land, bank that has the right location and right improvements. And eventually when markets permit we also might get back with the spec buildings. But we will analyze carefully market by market. We will analyze carefully into our own portfolio. And with that we will analyze in detail in the investment committee if it makes sense to start spec buildings or Build to Suit projects. As you could see there were no new starts in the quarter, but that doesn’t mean that we might start in the future other spec buildings particularly if there’s markets that have so strong demand that it’s worth considering spec buildings. So that’s we will continue to analyze both Build to Suit as well as spec buildings. Francisco Suárez: Got you. And as you mentioned, it seems that overall market dynamics in Guadalajara and Mexico are different and that allows you to be much more defensive with the spec properties, isn’t it?

I think that spec buildings are have been key to our strategy. We have benefited from anticipating to the market and we have benefited from having high quality flexible buildings where we can allocate logistics, e-Commerce and live manufacturing and at very high returns. So that strategy has paid-off a lot. Now we are leaving some uncertain times which that uncertainty at some point might dissipate. So we will analyze eventually when we will start to back to develop spec. But I think you’re right. I mean markets like Mexico City there’s nothing available in the market. Rents are increasing and continues to be a market with a strong needs for e-Commerce and logistics. So having spec buildings in Mexico City will continue to make sense. The last buildings we did particularly the one that we recently developed in Punta Norte was a spec building that turned into a Spec to Suit, which was pre-leased, and I think that’s a good example of the strategy of starting a building as a spec, but in the meantime being in close communication with potential tenants. Francisco Suárez: Thank you so much. Congrats.

Thank you, Francisco.

Your next question comes from the line of Alan Macias with Bank of America. Please go ahead.

Hi. Good morning and thank you for the call. Just a quick question on share buybacks. Should we expect at these levels to Vesta to continue to aggressively buyback – continue the buybacks during the next quarters? Thank you.

Alan, thank you for the call. We will be watching the markets. And whenever there’s an opportunity, we will buy aggressively on the stock. I cannot comment if these levels are the ones that I will operate on. But I will keep an eye, and if there’s an opportunity, the objective is to execute $150 million throughout the year when the opportunity arises. So we’ll be patchful of the stock price.

Thank you.

Your next question comes from the line of Bernardo Malpica with Santander. Please go ahead.

Hi Loren. Hi, Juan. Thanks for taking my question. Just a quick one. You’ve mentioned this in general terms. I wanted to see if you could give us a bit more color in terms of dynamics or any metrics in terms of what you’ve been seeing in market rents that you see in Monterrey and Tijuana specifically and what your outlook is for this year in those two markets? Thank you so much.

Can you repeat the question a little bit again, please?

Closer to the mic.

Yes. Closer to the mic. It took me some time to hear you out.

Yes, of course. I just wanted to know if you have more detail in terms of the market dynamics as in occupancy and market rents in both Monterrey and Tijuana specifically?

Sure. Yes, I think that so vacancy rates in Monterrey I think stood in the first quarter close to 7%, which is kind of in line to historic levels, a little bit higher than last year, but still in very healthy numbers. And I believe Tijuana is in close to 8%. First quarter was slow for both markets. And again, I think that that’s as a result of the uncertainties that we have perceived not only specific to those markets, but overall in Mexico industrial market, which actually is in line to what we have seen in the U.S. in industrial sector and even in some other regions like Europe. I think this particular cloud of uncertainty driven by trade tariffs and Trump is kind of affecting the whole sector – industrial sector even in different regions. But still vacancy rates we believe are in Mexico are still healthy very healthy numbers. And maybe to elaborate further on the market, which is positive is that rents continue to increase or stabilize at high numbers, which is very positive. So we have not seen any material adjustments on rents and that is good news.

Perfect. Good to hear. Thanks so much, Lorenzo.

Gracias.

Your next question comes from the line of Armando Rodriguez with Signum Research. Go ahead.

Hello, everyone. Thank you for the call and congratulations on the results. Just a follow-up on the previous questions. You recently drew down around $100 million of your credit line. So just wanted to know if this is related about – related to the bank reserves that you are mentioning recently or some opportunistic acquisitions or it’s just maybe to get something about your financial side?

Working capital loss [ph]?

Look, I mean, yes.

Yes.

Yes. Thank you. Thank you for the call. And thank you for the question. Look, we established the line, as we mentioned on the last quarter, with an 18 months’ drawback, I mean, drawdown. So we will be drawing on the line as cash needs happen on the company. The cash needs could be just plan acquisition or what have you. And we will continue to draw on that line. I like to keep the balance sheet leverage low. So we will draw down when needed. It depends on what – where CapEx is oriented. If it’s share buybacks, if it’s land acquisition, if it shows the general working capital needs of the company.

Okay. Perfect, Juan. Thank you very much.

Thank you.

As there are no further questions, I would now like to turn the call back over to Mr. Berho for his concluding remarks. Please go ahead.

Thank you, operator, and thank you. Thank you everyone for being on today’s call. We are very optimistic in the relationship between the U.S. and Mexico and we suspect that the second half of the year is likely to see a more active decision making among tenants. Vesta will be ready with high quality buildings in key corridors, a premium client base, a strong balance sheet and the operational capability to respond quickly. I’d like to thank our employees, clients, partners and our investors for your continuous confidence. We remain committed to transparency, to disciplined execution and to building a stronger Vesta. Thank you.

This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.