Navigating Tariff Turmoil: How Trade Policies Could Reshape America’s Major Port Real Estate Markets

SKIP AHEAD TO

• Los Angeles / Long Beach
• New York / New Jersey
• Savannah
• Houston, Texas

President Trump’s recent decision to impose sweeping “baseline” and “reciprocal” tariffs on all countries has sent shockwaves across global markets. After months of speculation, the Trump administration’s aggressive stance on tariffs has finally crystallized, producing an unprecedented economic tremor. Stock indices have slid toward bear-market territory, rattling investors already wary of potential disruptions. Governments, businesses, and consumers worldwide now grapple with the possibility of a fundamental restructuring of international commerce. On April 9th, 2025, the administration announced a 90-day pause on most tariffs — an attempt to buy time for diplomatic recalibration and negotiation. While this temporary reprieve has marginally calmed markets, it has done little to alter the broader trajectory of strategic planning. Businesses and commercial landlords, especially those with exposure to global supply chains, continue to scenario-plan for a range of outcomes, from targeted tariff reinstatements to a full-scale escalation. The pause may delay impacts, but it has not erased the need for proactive risk mitigation. Much remains contingent on how trade policy evolves over the coming weeks and months, which will ultimately shape the magnitude and distribution of economic consequences. Uncertainty reigns, with questions swirling around which tariffs will remain, whether a global trade war will escalate, and if the economy is headed into a recessionary spiral.

Yet, despite this turmoil, businesses have little choice but to navigate a path forward. Among the sectors poised to feel the most immediate impacts of tariffs are industrial real estate assets closely linked to America’s bustling ports. In this article, we zoom in on the nation’s four largest ports — Los Angeles/Long Beach, New York/New Jersey, Savannah, and Houston — examining their trade profiles, local real estate conditions prior to Trump’s policy shift, and forecasting how resilient each might be under various tariff scenarios.

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Los Angeles / Long Beach

The twin Ports of Los Angeles and Long Beach form the San Pedro Bay complex — the busiest maritime hub in the Western Hemisphere. In 2023, their combined throughput reached roughly 16.65 million Twenty-foot equivalent units (TEUs) (8.63M for LA, 8.02M for LB), handling approximately 35% of all U.S. container traffic. Considered together, these ports would rank among the world’s top ten busiest, underscoring their critical role as the main gateway for Trans-Pacific trade, particularly goods destined for the U.S. consumer market. China remains the dominant trading partner, comprising over one-third of LA’s trade volume, followed closely by Taiwan, Vietnam, South Korea, and Japan. Trade from regions outside Asia is nearly negligible.

Real Estate
The industrial landscape serving LA/LB ports is diverse, with compact, densely built warehouse facilities near the ports themselves complemented by sprawling logistics hubs further inland in California’s Inland Empire—the largest industrial real estate market in the U.S. While Inland Empire vacancies plunged to historically microscopic lows (below 1%) during the COVID-19 logistics surge, a recent building spree has led to vacancies rising to over 5%, compelling landlords to offer enticing concessions such as months of free rent and discounted pricing. According to CompStak data, free months in the Inland Empire industrial market rose from an average of 1.14 months in 2023 to 2.57 months in 2024, and were on pace to rise further as of Q1 2025. Average starting rent when weighted by transaction size hit an annual peak in 2023 at $15.73 per square foot but has since begun trending downward, sinking to an average of $13.71 per square foot in 2024. Intriguingly, port-adjacent properties have largely escaped this cooldown due to land scarcity, making Inland Empire facilities uniquely vulnerable to any tariff-driven downturn.

Tariff Scenarios
Under the Trump administration’s current tariff posture (as of April 2025), LA’s port sits squarely in the crosshairs. As the nation’s largest importer of Chinese goods, it faces disproportionate risk from tariffs aimed explicitly at reducing the trade deficit. This policy approach also places heavy pressure on other Asian exporters, notably Vietnam. If these tariffs persist as currently structured, LA port operations could face severe disruption. Conversely, should tariff pressures remain primarily focused on China—allowing Vietnam and other Asian nations to liberalize and expand their trade—the Port of LA is well-positioned to capitalize on increased volumes and weather the storm.

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New York / New Jersey

The Port of New York/New Jersey stands as the largest port complex on the U.S. East Coast, recently challenging Long Beach as the second-busiest national container port. In 2022, amid disruptions on the West Coast, NY/NJ surged past Long Beach, handling over 9.5 million TEUs. As conditions normalized in 2023, it settled back into third place with 7.81 million TEUs. Notably, NY/NJ boasts a geographically diverse trade portfolio, handling cargo streams from Asia, Europe, Latin America, and the Indian subcontinent. While China remains the port’s largest single partner (with approximately 1.06M TEUs in 2023, down notably from 2022), the region sees significant trade from India, Vietnam, Italy, Germany, South Korea, Thailand, Turkey, and Brazil — illustrating its well-rounded global footprint.

Real Estate
Similar to LA, the NY/NJ port area features a dense, land-constrained industrial core surrounded by a rapidly growing periphery, including Pennsylvania’s Lehigh Valley and central New Jersey. Following the post-COVID construction boom, the surrounding markets have experienced a rise in vacancies between 5% and 10% and in some cases declining rents. In CompStak’s New Jersey – North and Central industrial market, average weighted starting rents dipped 3.7% from $16.23 per square foot in 2023 to $15.63 per square foot in 2024, while annual lease escalations slipped to 3.57% in 2024 from 3.65% the year prior. Yet the market remains fundamentally space-constrained, and the recent slowdown in new construction could soon lead to tightening conditions.

Tariff Scenarios
New York/New Jersey’s diversified trade mix gives it a strategic advantage in coping with tariff disruptions. The port is positioned to adapt by shifting trade volumes across various sectors and routes, benefiting from strong connections through transatlantic, Panama Canal, and Suez Canal corridors. Additionally, several of NY/NJ’s largest trading partners — including EU countries, India, and Brazil — are likely to face lower reciprocal tariffs or exemptions on critical cargo categories like pharmaceuticals. While the port won’t entirely escape disruption, its diversified exposure significantly insulates it from shocks experienced elsewhere.

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Savannah

The Port of Savannah has emerged as one of the East Coast’s standout success stories, achieving explosive growth over the past decade. In 2023, Savannah handled approximately 4.93 million TEUs, becoming the fourth busiest U.S. port. Distinctively, Savannah hosts the Garden City Terminal — the largest single-terminal facility in North America — and possesses expansive acreage ideal for future growth. Savannah’s trade remains predominantly Asia-focused, although with a distinctively different partner profile from NY/NJ or LA. While China historically leads in trade volumes, Savannah has rapidly deepened connections with Vietnam and India. Additionally, Savannah supports robust export activities, particularly cotton and resin products destined for Asian and European markets, giving it a more balanced import/export ratio than many peer ports.

Real Estate
The surge in Savannah’s port activity during COVID-19 drove industrial vacancy rates below 1%, prompting logistics giants like Prologis and Counterpoint to embark on an ambitious construction wave, nearly tripling Savannah’s industrial footprint within five years. Currently, vacancies have settled at approximately 8%. Significantly, Savannah’s industrial market is tightly interwoven with advanced manufacturing facilities, notably Hyundai’s new EV plant, creating potential vulnerability if tariffs dramatically impact these sectors.

Tariff Scenarios
Savannah faces heightened exposure to tariff-induced risk given its critical role as a primary East Coast gateway for Asian imports. Optimistic forecasts of continued import growth have fueled extensive port and real estate expansions, which now face potential shortfalls if tariff tensions significantly disrupt trade flows. Additionally, Savannah’s reliance on export-oriented commodities means that retaliatory tariffs abroad could compound its vulnerability.

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Houston, Texas

The Port of Houston — the Gulf Coast’s largest port and America’s leader by total foreign trade tonnage — handles diversified cargo, including containers, petroleum, natural gas, chemicals, and grain. Container traffic reached 3.82 million TEUs in 2023, placing it fifth nationally, a figure that doubled over the past 15 years thanks to regional population growth and manufacturing expansion. Houston’s trade profile is notably balanced across Asia (China, Vietnam), Latin America (Brazil, Mexico, Colombia), and Europe (Germany, Italy), positioning the port as a pivotal intersection of multiple global markets. Crucially, Houston is also a major exporter, especially in petrochemicals, with key markets in Belgium, the Netherlands, and Asia.

Real Estate
Houston’s industrial real estate market historically experiences volatility linked to global oil and gas markets. While it also saw a significant building expansion during the recent boom, current vacancies remain above 7%, reflecting somewhat loose conditions. While the Houston industrial market saw a recent peak in the average weighted starting rent of $7.55 per square foot, tenants received on average 2.36 months of free rent in 2024, down from 3.03 months in 2021, according to CompStak data. Nonetheless, Houston benefits from robust demographic growth, bolstering distribution hubs serving expanding Texas populations. Tariff impacts, however, could prove uniquely unpredictable, given the city’s strong ties to energy markets.

Tariff Scenarios
Houston’s tariff risk largely hinges upon how the Trump administration’s trade policy influences global petrochemical markets. Given the port’s dependence on petrochemical exports, retaliatory tariffs or a downturn in global energy prices could severely depress local industrial real estate activity. With its diversified import-export trade structure, Houston remains somewhat insulated — but its fortunes remain deeply intertwined with oil and gas market stability in the face of tariff uncertainties.

One thing is clear amidst this period of economic uncertainty: Agility and liquidity will be essential. Businesses navigating the tariff landscape must remain adaptable and ready to pivot quickly. Stay informed and proactive to successfully weather the shifting dynamics of the industrial real estate market.