Manufacturers Rush to Buy Industrial Space Amid Tariffs

It’s unclear if tariffs will bring manufacturing back to the states, but some firms are beginning to bet on it.

Both sales numbers and brokerage anecdata indicate manufacturers are chomping at the bit to own property, enticed by customization, returns and rent-free operations, Bisnow reported.

The trend predates President Donald Trump’s trade policies. Industrial sales to buyers looking to occupy spaces popped 32 percent in the past year, according to CBRE.

But demand got a kickstart from the “Liberation Day” tariffs that went live April 2.

Broker David Wang of Houston-based PropNex Realty Group told Bisnow he’d fielded 250 percent more calls in the past few weeks from manufacturers looking to buy buildings.

Firms that make auto parts, windows or any product that requires machinery (so, most of them) now prefer to buy rather than rent, he said.

“They put in a fairly big investment, sometimes even over [the price per square foot] of the shell building cost,” Wang said.

A firm that spent $3 million on custom-built machines, for example, doesn’t want to think about moving shop, CBRE’s senior vice president Grant Hortenstine told the publication.

Plus, foreign companies moving stateside may not have the domestic credit profile to nab a lease.

“These companies are very creditworthy,” Hortenstine said. “They have a lot of cash, but they’re international companies, so they don’t underwrite as easily for an institutional landlord.”

— Suzannah Cavanaugh