US-Latin America Capital Flow: Data centers and logistics take the lead

US institutional investors prioritize regulatory stability, revenue dollarization, and robust local partnerships

August 18, 2026Real Estate

Executive Summary

The flow of investment from the United States into Latin America’s real estate sector is undergoing a significant transformation, shifting away from speculative bets to focus on strategic and resilient assets.

Driven by global trends such as nearshoring and digitalization, US capital is primarily being directed toward the logistics and data center sectors, particularly in Mexico and Brazil. This shift reflects a more sophisticated approach, where investors prioritize regulatory stability, revenue dollarization, and robust local partnerships to mitigate risks.

Although the region still faces challenges such as currency volatility and political instability, the structural demand for modern infrastructure and the increasing professionalization of the market are creating long-term investment opportunities.

The flow of capital from the United States to Latin America will be at the center of the debate opening the agenda for the Latin America GRI Real Estate - Miami Edition, to be held between 17th and 19th November. Find out more here.

Key Takeaways

US investment is moving away from traditional real estate assets, such as offices and retail, to concentrate on high-growth sectors like logistics and data centers, buoyed by nearshoring and the digital economy.
Investors are employing sophisticated financial structures, such as private credit and joint ventures, to hedge their investments against Latin America’s currency volatility and political uncertainty, favoring assets with dollarized revenues.
Regulatory clarity and legal stability are decisive factors in attracting long-term capital. Countries offering predictable business environments, well-regulated instruments, and tax incentives are becoming increasingly attractive to international investors.

From opportunistic allocation to strategic movement

US capital flowing into Latin America has ceased to be a short-term speculative movement or one based on interest rate arbitrage, evolving instead into a strategic and high-conviction allocation. Institutional investors are abandoning the pursuit of quick returns in favor of long-term investments in real assets that respond to enduring global trends, such as nearshoring and the advancement of artificial intelligence.

The new context presents a more selective approach, focused on sectors with solid fundamentals and sustainable growth potential. The trajectory of DigitalBridge in the region illustrates this movement: the US fund provides long-term capital to finance a methodical expansion across countries including Brazil, Chile, and Mexico - a structural bet on the growing demand for digital infrastructure, rather than a rapid entry-and-exit trade.

The industrial and logistics park sector is another highlight. The reorganization of global supply chains has rendered Mexico a particularly attractive destination for companies seeking proximity to the US market. This has driven strong demand for high-quality industrial assets, especially along export corridors and in major urban centers like Mexico City, where vacancy rates remain at historically low levels.

The recent acquisition of Terrafina by FIBRA Prologis, creating an 8.1 million square meter platform - the absolute leader in the Mexican industrial real estate sector - exemplifies this trend, with investors drawn to the stability of dollarized revenues, which account for nearly 80% of the lease agreements across its portfolio.

In parallel, the explosion of the digital economy and artificial intelligence is fueling unprecedented demand for data centers. Latin America, with its growing data consumption, vast territories, and clean energy availability, has become a key market.

Data center operators are aggressively expanding in the region with long-term projects under "take-or-pay" lease contracts that ensure stable and predictable cash flows. Examples include Scala Data Centers - backed by DigitalBridge, Ascenty - jointly controlled by Canadian firm Brookfield and US-based Digital Realty, Elea Data Centers - controlled by US fund I Squared Capital, and ODATA - acquired by US company Aligned Data Centers.

Another relevant player in the region is Silicon Valley-born Equinix, with significant investments in Brazil and Mexico, alongside operating units in the Santiago area in Chile, and established infrastructure in Colombia and Peru.

Regulatory environment and political outlook

Political stability and a clear regulatory framework are crucial for attracting and retaining foreign investment. The perception of risk across Latin American countries is far from uniform. Political instability and regulatory uncertainty constitute the main barriers to capital flows, even more so than short-term macroeconomic fluctuations, as highlighted by investors present at Latin America GRI Real Estate 2026.

A notable example of the positive impact of a favorable regulatory environment - although not directly applicable to real estate projects - is the Large Investment Incentive Regime (RIGI) in Argentina, which offers 30-year guarantees of fiscal and exchange rate stability, proving pivotal in unlocking investments in capital-intensive sectors such as energy and infrastructure.

Real estate investment funds in Mexico (FIBRA) and Brazil (FII) also represent vehicles that foster greater confidence and liquidity for foreign investors, attracting hundreds of billions of dollars by dismantling physical capital allocation barriers and facilitating asset transactions, backed by corporate governance and transparency guaranteed by clear regulatory frameworks.

Tax incentives, such as Uruguay's Investment Promotion Law - which offers Corporate Income Tax (IRAE) exemptions that can reach up to 100% of the invested amount in real estate and infrastructure projects under free zone regimes and industrial and residential promotion laws - and Colombia's housing incentive program with VAT exemption, also encourage the flow of foreign private capital into Latin America.

US institutional capital does not demand political or ideological uniformity, but it reacts critically to unstable rules of the game and rewards frameworks that guarantee the legal certainty of investments. At a recent GRI Institute event held in New York, institutional stability and respect for contracts were cited by 25% of executives as the top priority for the incoming Brazilian government to attract long-term international capital.

Latin America's position on the global stage

Although Latin America is not the primary destination for global venture capital, which remains concentrated in developed markets, the region has carved out an important space as a strategic growth market. Proximity to the United States, combined with favorable demographics - including a young workforce compared to an aging Europe - makes the region an appealing bet for the future.

Historically, greenfield foreign direct investment originating from the US has exhibited a high geographical concentration within Latin America. Mexico and Brazil alone absorbed 63% of all US FDI directed at the region since 2003, a figure that rises to approximately 70% when adding flows to Guyana due to the development of its offshore oil reserves, according to a report by the Atlantic Council.

This distribution reflects a primary orientation toward large-population markets or those endowed with globally strategic natural resources. Attracting capital into economies exposed to sovereign risk - as is the case for most Latin American countries - relies on legislative mechanisms capable of isolating developments from governmental shifts.

Competition for global capital is fierce. Latin America competes not only with other emerging regions, but also with developed markets offering lower risk. The perception of the region's "eternal adolescence", as noted by executives present in New York, characterized by cycles of political and economic instability, remains an obstacle. Currency volatility, in particular, is a major concern, as it can erode returns when converted back into US dollars.

According to the United Nations Conference on Trade and Development (UNCTAD), global foreign direct investment flows reached USD 1.6 trillion in 2025, up 6% after two years of decline. Latin America received USD 188 billion, accounting for just 11% of the total. The positive takeaway for the region is that this figure represents a 14% growth compared to 2024 FDI, outstripping the global average and driven heavily by Brazil.

Preferred structures

To navigate the complexity of the Latin American market, investors have been adopting sophisticated investment structures to help mitigate risks.

Joint ventures

The era of the "parachute investor" is over. Today, success hinges on strategic partnerships with local operators who possess deep market knowledge and can navigate regulatory and bureaucratic complexities. These partnerships are increasingly built on aligned interests, with local partners co-investing significant equity into the projects.

The strategy of Patria Investments illustrates this model: the Brazilian asset manager, backed by strong US capital commitments, structures its infrastructure and real estate investment vehicles by combining local operational expertise with the institutional discipline required by its international limited partners, serving as a bridge between foreign capital and local market nuances.

Private credit

Private credit has emerged as a preferred investment vehicle. Rather than taking direct equity risk, many US funds prefer providing debt financing for real estate projects. This enables them to secure attractive returns with downside protection, given that loans are secured by real assets and transactions are frequently conducted entirely in US dollars - insulating them from currency volatility.

A prime example of this structure in Latin America is Vinci Compass, which operates extensively with international capital raised through its Miami and New York offices.

In Brazil, the manager provides credit via the acquisition of Real Estate Receivables Certificates (CRIs) in tailored transactions. In Colombia and Chile, Vinci Compass manages institutional mandates focused on real assets and funds acquiring structured corporate and mezzanine debt to enable developments. The manager is also active in Argentina, where it completed the acquisition of BACS, reaching USD 1.6 billion in assets under management in the country.

FIBRA and FII

Real Estate Investment Trusts (FIBRAs) in Mexico and Real Estate Investment Funds (FIIs) in Brazil, similar to REITs in the US, are gaining widespread popularity as investment vehicles.

These instruments provide liquidity and transparency, enabling investors to access a diversified portfolio of income-generating real estate assets. As the region's markets mature, REIT-like structures are expected to become increasingly prevalent, dominating the ownership landscape of income-producing properties.

US-Latin America Outlook

In conclusion, US investment in Latin American real estate is becoming more selective and strategic. The focus remains squarely on high-quality assets in high-growth sectors, backed by robust financial structures and strong local partnerships.

The region's ability to continue attracting this capital will depend on its capacity to provide political and regulatory stability, fostering an environment where long-term investments can thrive.