Trump 2.0: The First 100 Days | United States

Other Important Trade Measures

Impact on CRE

• Repeal of the de minimis provision, along with foreign ship fees, could dampen demand from foreign e-commerce companies who have accounted for a growing share of leasing. • Retaliatory tariffs from other countries such as China and Canada will be impactful to U.S. production of goods such as agricultural products, alcohol and machinery. By extension, logistics networks supporting the storage and export of these goods may see softer demand for industrial space. • The trade war is evolving to target duties on specific products while exempting others. Autos/parts, semiconductors and pharmaceuticals have been center stage. Tariffs on these goods will raise input costs,

Repealed the de minimis trade provision which exempted imported goods under $800

• This will lead to higher costs for foreign e-commerce companies, who have been expanding into U.S. warehouse markets via 3PL partners.

• For now, China will face this change on May 2, however there is no date for other countries.

Imposed fees on ships manufactured in China when entering U.S. ports

• Containers could be rerouted to ports in Canada and Mexico to avoid fees, but since more than 50% of ships are manufactured in China (and 95% of shipping containers), totally evading these fees will be difficult.

Retaliatory measures

• Important trading partners including, China and Canada, have implemented retaliatory tariffs on U.S. made goods, which will reduce export demand.

Targeted sector tariffs

which could dent industrial demand in manufacturing hubs and broadly hurt retailers in these sectors.

• Sector-specific tariffs on automobiles and parts will raise the cost to produce cars even domestically, as many parts are imported. Tariffs on pharmaceuticals and semiconductors have been threatened as well.

• Steel/aluminum tariffs of 25%, in addition to the broader reciprocal tariffs, will raise costs for CRE construction and further limit the development pipeline across sectors. President Trump has also threatened tariffs on copper, which is an input for electrical gear, plumbing and roofing.

Building materials

• Targeted tariffs on steel and aluminum, as well as the prospect of copper and lumber tariffs, will raise construction costs. NAHB estimates new tariffs will raise the cost of a single-family home by $9,200.

Source: Various

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