Tariffs Chill Los Angeles’ Industrial Property Market

Southern California’s industrial real estate market is experiencing a significant slowdown in 2025, largely attributed to the escalating trade tensions and tariffs introduced by the Trump administration. The uncertainty surrounding these policies has led businesses to delay leasing decisions, particularly in Los Angeles County, a region heavily reliant on international trade.  

President Trump’s recent imposition of a 125% tariff on Chinese imports, alongside a 10% baseline tariff on goods from most other countries, has disrupted the flow of goods through Southern California’s ports. This disruption is causing a ripple effect across the logistics and warehousing sectors. Analysts predict that if imports decline by the anticipated 25%, the industrial market could face increased vacancies and a slowdown in new construction projects.  

The Port of Los Angeles, a critical hub for U.S. trade, is already witnessing the impact. Executive Director Gene Seroka forecasts a 35% drop in container arrivals in the coming weeks, as shipments from China and Southeast Asia dwindle. This decline follows a temporary surge in imports as companies rushed to beat the tariff deadlines.  

The broader economic implications are profound. Southern California’s trade and logistics industry, which contributed nearly $300 billion in direct economic output in 2022 and supported close to 2 million jobs, is at risk. The tariffs threaten to undermine this vital sector, leading to potential job losses and decreased economic activity. 

In response to the growing concerns, President Trump announced a 90-day pause on tariffs for most nations, excluding China. However, this temporary reprieve has done little to alleviate the uncertainty. Businesses remain cautious, unsure of the long-term trade landscape and hesitant to commit to new investments or expansion plans.   

As the situation evolves, stakeholders across Southern California’s industrial and trade sectors are closely monitoring developments, hoping for clarity and stability in trade policies to restore confidence and momentum in the market.