Obviously there are major implications on the cost of goods, overall capital markets, etc. I can't see any way in which this won't push down pricing for real estate and force banks to raise liquidity and foreclose on borrowers who have been kicking the can down the road. Could this mean more buying opportunities and a need for more people? Any other impacts you're forecasting?
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no.
We can only hope
Widespread distress in real estate, even if it leads to buying opportunities, will not result in more jobs being created in real estate. There is not a single short term positive effect of these tariffs for our industry, and I am not a believer in the long-term play.
Is this a joke?
I wouldn’t say the tariffs are good for real estate. However, I’d argue real estate as whole is better insulated from it than a lot of other industries. REITs have outperformed the S&P 500 YTD and I think for good reason. Real estate benefits from lower interest rates more than almost any other industry and for most US operators pretty much all your business is done inside America. Tariffs are going to make development more expensive but also limit new supply coming online, which is good if you already own a lot of existing assets. Some segments are going to get hit harder than others (e.g., industrial properties near major ports).
Obviously, a recession isn’t good for anyone but I’d feel much better about owning an apartment building or grocery store right now than Nike and having a 49% tariff on stuff you import from Vietnam.
Note: I thought I caught the falling knife on Nike and am having a rough day.
That's kinda like saying you'd rather own a stock not impacted so much by tariffs than a retail center with Nike, a dollar store, and several other retailers that get all their goods from Asia
Correct, that’s a segment within the real estate space that is not insulated from tariffs.
Then don’t buy a mall REIT?
Unless you are developing real estate, in which case you've been on multiple calls daily this week discussing just how mucked up your construction budget is.
Or you're working on a build-to-suit for a group that no longer can say what their cost inputs are with any amoutn of certainty and may not want to move forward with the project.
nice
2+ years getting walloped on the denominator, going to be another 2+ getting walloped on the numerator. Great stuff.
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