Logistics Goldmine: LPA's 20% Rental Surge Signals a Latin American Boom

Investors, listen up: The logistics sector isn't just about warehouses anymore. It's about dominating high-growth markets with ironclad contracts—and right now, Logistic Properties of the Americas (LPA) is pulling off a masterclass in this space. Let me break down why this 20% rental spike in Costa Rica isn't a fluke, but a sign of a much bigger opportunity.

The 20% Rental Surge: A Lease Deal Made in Heaven

LPA just reported its Q1 2025 results, and the numbers scream demand for institutional-grade logistics in Latin America. Take Costa Rica: A new five-year lease at LPA's Coyol 4 Logistic Park in San José just locked in at 20% higher rental rates than the old one. This isn't a one-off—it's part of a broader strategy.

The company's Costa Rican revenue jumped 6.1% year-over-year to $6.0 million, fueled by these rental hikes and the stabilization of a 2024-built facility. Occupancy remains a staggering 98%, and average rents have crept up to $7.96 per sq ft—up 2.2% from last year. This is about more than just Costa Rica: It's a template LPA is replicating across its 31-property portfolio in Colombia, Peru, and now, eyeing Mexico.

Diversification = Lower Risk, Higher Rewards

LPA isn't putting all its eggs in one basket. Its three-pillar portfolio—Costa Rica, Colombia, and Peru—is a textbook example of geographic diversification. Take Peru: The company is building a 227,000-sq-ft facility in Callao that's already 70% pre-leased. Meanwhile, Colombia's occupancy is hitting all-time highs.

This diversification isn't just about spreading risk—it's about tapping into secular tailwinds. E-commerce in Latin America is booming, with regional giants like MercadoLibre and Jumia driving demand for modern logistics infrastructure. Add to that the push for supply chain modernization—U.S. companies are flocking to the region for cheaper manufacturing, and they need warehouses. LPA's U.S. dollar-denominated leases are a secret weapon here: They insulate investors from currency volatility in emerging markets while locking in steady cash flows.

The Defensive Play with Upside: Rate Resets and Development Pipelines

Here's why this is a high-yield defensive stock:
1. Occupancy Rates: 98% in Costa Rica, 97% in Colombia—this is rock-solid demand.
2. U.S. Dollar Leases: 70% of its leases are in dollars, shielding investors from inflation and currency devaluations.
3. Rate Resets: As leases roll over, LPA can push for higher rents. The 20% jump in Costa Rica wasn't an outlier—it's a trend.

And let's not forget the development pipeline. LPA isn't just sitting on its portfolio; it's expanding. The Peru project alone adds 227,000 sq ft, and management is already eyeing Mexico. This isn't just about growth—it's about owning the critical infrastructure that underpins regional commerce.

The Bottom Line: Buy the Dip, Hold for Dividends and Growth

LPA isn't just a play on logistics—it's a bet on the Latin American economy's evolution. With e-commerce set to hit $200 billion in the region by 2027, and supply chains shifting to the Americas, LPA's scale and strategic leases make it a must-own name.

Investment thesis:
- Buy now if you see dips below $25 (based on its 52-week range).
- Hold for dividends: The current yield of 4.2% is solid, and rising rents should push it higher.
- Long-term upside: Rate resets and new developments could push revenue growth to 8-10% annually over the next three years.

This isn't a gamble—it's a strategic play on a region that's finally coming into its own. LPA's got the numbers, the contracts, and the vision. Don't miss the train.

Action Alert #: Buy LPA on weakness below $25 and hold for the logistics boom.