Trump's First 100 Days Sow Uncertainty And Hope For Commercial Real Estate

Donald Trump reentered the White House 100 days ago with a far-reaching agenda that had the potential to reshape vast swaths of the American economy, commercial real estate included.

Many of Trump's economic policies, from deregulation to tax reform, were expected by much of the business community and the commercial real estate industry to boost growth. But the lightning-fast pace of change coming from the Oval Office has injected fresh worries into a sector that began the year feeling optimistic after years of gloom.

"Everybody's frozen," said Holly MacDonald-Korth, CEO of middle-market lender KDM Financial. "It's very difficult to make decisions, because you can't forecast what the future is going to be."

As rapid-fire changes emerge from the White House, major economic indicators now point to slower growth, and the specter of a recession once again looms over a CRE industry that thought it was out of danger.

Some of the president's actions have already had major implications for commercial real estate just 100 days into his term, while the ripple effects of other moves haven't yet materialized and could play out as the year progresses. His decisions on tariffs and federal office use have been among the most consequential so far, both contributing to uncertainty for CRE and even delaying or killing deals. Meanwhile, issues like infrastructure spending, reshoring, housing reform and changes to popular programs like EB-5 have yet to make their mark.

Troublesome Tariffs

On April 2, the day Trump dubbed "Liberation Day," he announced a crushing new tariff regime that shook a sector already grappling with the president's early trade proclamations. Most of the April 2 tariffs were temporarily suspended less than a week later, but a combined 145% levy on Chinese imports remains.

Commercial real estate activity is already being dragged down by the taxes and the uncertainty around the cost of everything else. Some of the industry's biggest names—including Blackstone, Prologis and CBRE—cited tariffs in their first-quarter earnings calls as the cause of slower deal activity or hesitation around updating guidance.

"Prior to April 2, industrial fundamentals were improving, and had it not been for the recent uncertainty from global tariffs and their downstream impacts, we would have raised our expectations for 2025," Prologis Chief Financial Officer Tim Arndt said during the company's Q1 earnings call. "Instead, we're electing to maintain earnings guidance, as there are no policy conclusions right now to plan differently."

Prologis also opted to cut its development pipeline for the year by as much as $1B, citing the possibility of a recession or inflation—though it acknowledged a "quick resolution" was still possible.

The International Monetary Fund shaved 40 basis points off its 2025 global growth projections, which it now forecasts at 2.8%. The U.S. forecast was cut to 1.8%, down 90 basis points from the January estimate, with nearly half of that contraction directly attributable to tariffs.

"Coming into 2025, President Trump was handed a really solid economy," said Marisa DiNatale, senior director of economic research at Moody's Analytics. The launch of the trade war changed that. "Our assumption now is that growth is going to be much weaker this year," she said.

That expectation is already playing out in the marketplace. One out of every five builders has had a project delayed because of tariffs, according to a survey by the Associated Builders and Contractors.

And the debt needed to get projects started hasn't gotten any cheaper, dashing hopes from earlier in the year. The U.S. Treasury bond yields that drive debt underwriting had begun to fall after Trump won the White House, but investors quickly soured after Inauguration Day, as tariff rhetoric turned into policy and Trump moved to make good on pledges Wall Street had taken as bluster.

A recession would inevitably sting the commercial real estate sector, but the wide range of potential outcomes—and the inability to predict where the economy is headed—has already sucked much of the momentum out of the early innings of the hoped-for market rebound.

"The question now is: How long does this uncertainty last? The longer it persists, the higher the odds of it actually manifesting into a recession," DiNatale said.

Some do see opportunity in a downturn, including Blackstone, which signaled optimism about its ability to capitalize on a distressed market if a recession materializes. But for now, business operators aren't just trying to predict where prices will land—they're also reacting in real time as the White House looks to remake the executive branch, the agencies under it and the places where those agencies' employees work.

Emptying Offices

Trump's effort to reinvent the scope and scale of the federal workforce has been a cornerstone of his term since Inauguration Day, when he signed an executive order banning telework for government employees.

He enlisted billionaire Elon Musk to helm the Department of Government Efficiency, with a mandate to cut federal spending and waste. Musk and his team have torn through agencies, slashing budgets and firing more than 100,000 of the government's more than 2 million employees.

At the same time, the government is aggressively pushing to shrink its real estate footprint, but the effort has been mystifying for brokers and landlords. DOGE has released various lists covering millions of square feet of leases it intends to terminate—or properties it wants to sell—only to pull those lists shortly after posting them.

With a portfolio of owned and leased real estate totaling 360M SF, the General Services Administration is the largest office user in the country. A February Barclays report estimated that some $12B in CMBS debt was tied to properties affected by the cuts.

Turmoil for the country's largest office user is unwelcome news in an office market that has suffered mightily over the past five years. Landlords with federal tenant rosters, particularly in Washington, D.C., are grappling with the loss of long-term, high-credit users just as return-to-office numbers began trending favorably.

The mere existence of DOGE's lists has upended how investors and debt underwriters view office buildings with federal tenants, MacDonald-Korth said. For decades, federal agencies were seen as top-tier office tenants—unlikely to miss rent payments and prone to renewing their leases. DOGE's push to walk away from as much leased space as possible has inverted that calculus, she said.

"I have definitely turned down credit files that had government tenants—several of them in the last few months," she said. "I'm not willing to take the risk."

Immigration Crackdown

While the impacts on commercial real estate from the overhaul of the federal government are striking, the industry is also wrestling with the second-order effects of other early directives from the White House, including on immigration.

Trump's promise to launch a campaign of mass deportations began with 32,809 arrests in the first 50 days of his administration and has continued with pledges to pick up the pace.

Private prison operators expect to benefit from new contracts as enforcement ramps up, but the construction industry expects the crackdown to worsen a worker shortage that has plagued it for years.

Roughly 1 in 4 construction workers are foreign-born, and many are in the country legally. But regardless of status, fear runs deep in immigrant communities; one construction firm owner told Bisnow in March that employees were afraid to do basic tasks for fear of drawing the attention of immigration officials.

"A lot of these guys are worried to drive and go pick anything up—worried about if they pass a stop sign, are they getting pulled over, are they getting deported if they don't have the proper documentation?" Huntington Estate Properties founder Ramtin Nosrati said of his California workforce.

At the same time, the administration rolled out plans to replace the EB-5 visa program with what it's calling a Trump gold card. EB-5 is a popular route for real estate professionals seeking to enter the country and has helped finance major projects including New York's Hudson Yards and The Wharf in Washington, D.C., raising more than $2B in each of 2023 and 2024. The gold card would raise the investment minimum from $1M to $5M, but its timing, legality and availability remain unclear.

Commerce Secretary Howard Lutnick, who was chairman of Newmark until his appointment to Trump's Cabinet, has offered multiple timelines that have come and gone. Earlier this month, he said the new program would launch within weeks.

On The Horizon

Some of Trump's first-100-days actions have had minimal impact so far but set the stage for consequential shifts down the road. Among them is the administration's overhaul of the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac.

Trump installed Bill Pulte, of the family behind homebuilder PulteGroup, as director of the FHFA, and Pulte in turn touched off a shake-up at the boards of both Fannie and Freddie. He also dismissed and replaced Freddie's CEO and fired roughly 100 staff, citing unethical conduct.

At the same time, the administration is weighing a possible end to the yearslong conservatorship of Fannie and Freddie, which underpin the $12T U.S. residential mortgage market. Removing the agencies from government control would mean drastic changes for debt underwriting nationwide. The administration hasn't committed to ending the conservatorship, but Pulte has signaled online that more changes are ahead.

While Pulte's focus has been firmly on housing, Trump has spent his first 100 days pushing for more industrial, data center and infrastructure development. The day after his inauguration, he was joined by the heads of OpenAI, SoftBank and Oracle at the White House to announce a $500B plan to build Stargate, a sprawling data center campus in Texas. Amazon, Google, Meta and Apple have all made similar commitments to spend tens of billions of dollars building out infrastructure and computing power to support the expected mass integration of artificial intelligence into daily life.

These efforts dovetail with Trump's tariff ambitions, which he says will bring manufacturing back to the U.S. Here, the administration has already notched some early wins, in part because the goal aligns with efforts from Joe Biden's administration through the CHIPS Act and Inflation Reduction Act. In March, Musk's Tesla announced plans for a new 1M SF battery factory outside Houston; a day earlier, Honda said it would move electric Civic production to the U.S. to avoid tariffs. Manufacturing demand accounted for 19% of industrial space requirements in 2024, according to JLL, which projected it would reach a quarter of demand by 2028—even before Trump won a second term.

The first 100 days of the new Trump administration have been among the most consequential of any modern president. By leveraging dozens of executive orders and aggressively pushing past roadblocks—legal and otherwise—the administration is seeking to reshape global trade and the American economy, taking CRE with it.

In a year meant to mark a threshold to a market upturn, many hopes have been dashed for CRE professionals amid still-rising costs and a haze of deal-hobbling uncertainty. Still, hope isn't lost.

"There's still hope for a soft landing," Trepp Chief Economist Rachel Szymanski said, referring to the delicate balancing act that brings inflation to heel without significantly hurting the job market. "You're not really seeing major shifts in inflation and unemployment growth. What you're seeing is shifts in more than soft data. There's just a lot of uncertainty when it comes to the actual trade policies."