News Type: Roundtable Weekly

GOP Leaders Signal Reconciliation May Slip Past July 4 Deadline as Negotiations Continue

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As Senate Republicans navigate internal divisions and mounting pressure from the White House, critical policy decisions in the reconciliation package—including tax reforms, energy, and trade provisions are rapidly taking shape with implications for commercial real estate.

State of Play

  • More doubts have emerged among GOP leaders about whether the Senate will be able to meet its self-imposed July 4 deadline for passing its version of the reconciliation package.
  • Though Speaker of the House Mike Johnson (R-LA) believes that the GOP is still on track, he emphasized that meeting the deadline hinges upon how much the Senate’s bill diverges from the House bill passed last month. 
  • “We’ll see what they produce,” Johnson told Politico, adding, “I just need them to come to their final decisions on everything. So we’ll see how it shapes up.” (Politico, June 11) 
  • Though the White House is keeping the pressure on senators, even President Donald Trump has acknowledged that additional time could be needed to finalize the reconciliation measure. (Politico, June 11)   
  • For their part, House Republicans approved several changes to their bill this week that were necessary in order to keep it in compliance with Senate rules. (Politico, June 10)  
  • If the Senate makes major revisions, the bill could go to conference in July in order to hammer out the differences, which could run up against the U.S. hitting its debt limit in August. (Axios, June 11) 
  • Senate Majority Leader John Thune said his team and key Senate committee chairs are coordinating closely with Speaker Johnson, holding weekly meetings and frequent calls to prevent the House from altering a bill that passes the Senate.
  • “There’s just a lot of coordination to hopefully avoid some of the potential snafus that could happen with something that’s this complicated,” Thune said. (Politico, June 11)

Key Issues 

  • Fiscally conservative Sens. Rand Paul (R-KY) and Ron Johnson (R-WI), among others, continue to scrutinize the long-term effect that the “Big Beautiful Bill” would have on the budget deficit.
  • In an interview with the Financial Times on Tuesday, Sen. Johnson conditioned his vote on assurances that the White House would cut more federal spending with a second major bill before next year’s midterm elections. (Financial Times, June 11)
  • The spotlight remains on the Senate Finance Committee, with Chairman Mike Crapo (R-ID) telling GOP senators Wednesday that he plans to scale back the House’s cap on the deductibility of state and local taxes (SALT) for individuals and rework repeals of clean energy tax credits from the Inflation Reduction Act (IRA). (Punchbowl News, June 12) 
  • Senate Republicans are also aiming to make business tax deductions for R&D, equipment purchases, and interest on debt permanent, rather than temporary as proposed in the House bill. (Punchbowl News, June 13)

IRA Energy Tax Credits

  • Senate Majority Leader John Thune (R-SD) is juggling different IRA demands, including at least four senators who want a less aggressive approach to the House’s proposed repeals. (Punchbowl News, June 12)
  • Sixteen clean energy tax incentives could be repealed or modified under the House-passed reconciliation bill, now under review by the Senate. Proposed changes to the IRA’s clean energy credits would eliminate incentives for residential energy-efficient upgrades and clean vehicles, while shortening the window for projects to begin construction and still qualify.  (PoliticoPro Analysis, June 11)
  • Senate Republicans are moving toward a consensus on preserving the transferability of clean energy tax credits from the IRA, as Finance Chair Mike Crapo (R-ID) signaled openness to easing the House-passed restrictions and extending the phaseout timelines during a GOP conference briefing this week. (PoliticoPro, June 12)
  • The House-passed measure included provisions that would restrict credit transferability, which allows companies to sell their tax credits to a buyer in exchange for cash. (PoliticoPro, June 12)
  • “If you are going to have a credit, if it’s not transferable, it’s not of much use,” said Sen. Kevin Cramer (R-ND). (PoliticoPro, June 12)

Trade Talks

  • Tariffs on materials such as lumber, steel, and aluminum have presented several challenges for commercial real estate. Impacts have included increased construction costs, the potential for project delays, and heightened uncertainty among investors. (RW, April 4)
  • The U.S. and Mexico are approaching a deal to reduce or eliminate President Trump’s 50 percent steel tariffs on imports, up to a certain volume. (Reuters, June 10)
  • This week, Commerce Sec. Howard Lutnick and senior economic officials from China agreed “in principle” to a framework of a “trade truce” between the world’s two largest economies, a sign of further progress. (CNN, June 11)
  • Late Wednesday, Trump said the U.S. was “rocking in terms of deals,” as it held trade talks with about 15 countries, including Japan and South Korea—but the president also threatened to unilaterally set tariff levels for many other countries in the coming weeks.   (WSJ, June 12)

Looking Ahead

As the White House urges Senate Republicans to make only modest changes to the reconciliation bill, Senate leaders are moving toward issuing final bill text by June 23, followed by a vote-a-rama. (Politico, June 12)

RE-ISAC and Homeland Security Task Force Address Civil Risks

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Widespread demonstrations against recent Immigration and Customs Enforcement (ICE) raids, including National Guard deployments across the nation, prompted urgent coordination among commercial real estate leaders this week through The Real Estate Roundtable’s (RER) Homeland Security Task Force (HSTF). (Washington Post, June 13)

Why it Matters for CRE

  • In response to protests over recent immigration sweeps across the U.S., RER’s HSTF,  Real Estate Information Sharing and Analysis Center (RE-ISAC), and partnership with the Commercial Facilities Sector Coordinating Council convened several calls this week to assess potential impacts on properties and personnel. (Axios, June 9)
  • The escalating risk environment, including looting, anti-government extremism, and threats against infrastructure—has immediate implications for commercial real estate assets.
  • Protests in L.A. County and across the country triggered curfews and disruptions across business sectors, including retail, restaurants, and hotels.
  • Tesla Supercharger stations and other critical infrastructure were identified as high-risk. Fires and vandalism remain top concerns, especially near historic and civic buildings.
  • Last month at RER’s HSTF Meeting, one of the discussions included a review of the risks to commercial facilities from lithium-ion batteries with John Frank (AXA XL Risk Consulting). The meeting also included a series of briefs from the FBI regarding the threats from terrorist and transnational criminal organizations that are directly threatening U.S. citizens and commercial facilities. (Roundtable Weekly, May 30)

RER’s Homeland Security Task Force and RE-ISAC Response

  • Rising global tensions are also heightening domestic security concerns. The U.S. has repositioned military resources in the Middle East in response to Israeli strikes across Iran—a development that raises the risk of Iranian retaliation and potential threats to homeland security and critical infrastructure. (AP News | Axios, June 13)
  • Through the HSTF, RER works with government officials and private sector partners to detect, protect, and respond to a multiplicity of key threats.
  • Under the oversight of the HSTF, the RE-ISAC, serves as the primary conduit of terrorism, cyber and natural hazard warning and response information between the government and the commercial facilities sector.

  •  “This moment requires vigilance, clarity, and coordination across sectors,” said HSTF Chair Amanda Mason (Executive Director, Global Intelligence, Related Companies), who led several calls throughout the week.

  • RE-ISAC’s information-sharing network coordinates activities supporting the detection, prevention, and mitigation of a full range of physical, data, and cyber threats to the nation’s critical infrastructure.

RER, through its HSTF, will remain engaged in efforts to address evolving threats affecting the sector. Through regular briefings and coordination with public- and private-sector partners, the HSTF will continue to support preparedness and resilience across the industry.

Coalition Urges Senate to Revise Section 899 to Protect Access to Foreign Capital for U.S. Real Estate Investment

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The Real Estate Roundtable (RER) and a coalition of real estate organizations sent a letter to Senate Majority Leader John Thune (R-SD) and Finance Committee Chair Mike Crapo (R-ID) this week, calling for changes to the House-passed Section 899 tax proposal to prevent harm to U.S. real estate investment, property values, and economic growth. (Letter, June 12)

Why it Matters

  • The retaliatory tax provision is part of the broader House reconciliation package and would impose steep tax increases on investors from countries that enact “unfair” taxes on U.S. businesses.  (Bloomberg, June 12)
  • The coalition letter cautions that, without changes, the retaliatory tax measure could potentially drive up borrowing costs, depress property values, and significantly deter foreign investment in housing, commercial developments, and infrastructure projects nationwide. (PoliticoPro, June 13)
  • As drafted, the policy would apply broadly to both equity and debt investments in U.S. real estate, including capital gains, REIT dividends, and interest income—regardless of whether the investor has any controlling stake in the U.S. property.
  • The coalition urges the Senate to revise Section 899 to exempt non-controlling real estate investments—passive holdings that do not involve day-to-day management.
  • The coalition is also seeking to ensure the exemption applies to both new and existing transactions made under current law and tax treaties, and prevent an unintended retroactive tax increase that could disrupt capital markets and undermine confidence in U.S. investment stability. (Letter, June 12)
  • On Institutional Real Estate, Inc.’s podcast this week, RER President & CEO Jeffrey DeBoer emphasized the importance of maintaining stable, predictable tax policy to attract investment and fuel economic growth—echoing the coalition’s call for Senate revisions to Section 899 that avoid discouraging capital formation in U.S. real estate. (IREI Podcast, June)
  • Speaking at the NYU Federal Real Estate and Partnerships Tax Conference today, RER Senior Vice President and Counsel Ryan McCormick warned that Section 899 “would impose higher tax rates on foreign capital that is critical to U.S. real estate, impacting interest income, REIT dividends, and direct property investments. Without an exemption for passive investors, it would have a chilling impact on investment, raise borrowing costs, and slow economic growth.”

By the Numbers

  • Over the past five years, foreign sources have invested more than $213 billion in U.S. commercial real estate, including $57 billion in multifamily housing. This cross-border capital supports construction, jobs, housing affordability, and local tax revenue. (Letter, June 12)
  • The Joint Committee on Taxation has projected that Section 899 would lead to a “decline in foreign demand for U.S. investment” and ultimately reduce Treasury revenues. (AP News, June 10)
  • The Global Business Alliance, which represents foreign multinationals with U.S. operations, released a new study on Tuesday that found Section 899 would result in $100 billion a year in lost gross domestic product. ( PoliticoPro, June 11)

View from Capitol Hill

  • Republican senators have said they’re taking a deeper look at that provision and could make changes when the Senate Finance Committee’s version of the tax bill is released. (PoliticoPro, June 13)
  • During a House Ways and Means Committee hearing on Wednesday, Treasury Secretary Scott Bessent defended the so-called revenge tax in the GOP megabill, in the face of concerns that it could deter foreign investment. (Watch Hearing | PoliticoPro, June 11)
  • Secretary Bessent also testified at the Senate Finance Committee hearing on the president’s fiscal 2026 budget request for the Treasury and tax reform on Thursday.
  • Sen. Thom Tillis (R-N.C.), who’s questioned the proposal, told reporters Tuesday that he at least expects a delay in the proposal. (Bloomberg, June 10)
  • House Ways and Means Chair Jason Smith (R-MO) indicated the preferred outcome would be for the revenge tax never to take effect, urging foreign governments to eliminate discriminatory measures, such as digital services taxes. (PoliticoPro, June 11)

What’s Next

Senate Finance Republicans are expected to release revised legislative text of the One Big Beautiful Bill Act in the coming weeks. “We’re working as aggressively as we can to move as fast as we can,” Senate Finance Chair Mike Crapo (R-ID) said. (Politico, June 9)

RER continues to advocate for smart tax policy that avoids unintended consequences while maintaining the U.S. real estate market’s global competitiveness.

Fed’s Beige Book Highlights Uncertainty; CRE Leaders Cautious on Outlook

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The Federal Reserve in Washington, DC

As the Federal Reserve’s latest Beige Book reveals, the U.S. economy is continuing to adjust to shifting conditions, with commercial real estate leaders focusing on strategies to navigate ongoing uncertainty and emerging opportunities. (The Fed, June 4)

Beige Book Findings

  • The Beige Book published this week, reported that “all Districts reported elevated levels of economic and policy uncertainty, which have led to hesitancy and a cautious approach to business and household decisions.”
  • The report, based on surveys and interviews conducted through May 23, noted that the overall outlook remains “slightly pessimistic and uncertain,” unchanged from the prior report. (Bloomberg, June 4)
  • Nine of the 12 Federal Reserve districts reported either a contraction in economic activity or no change in growth; only a few districts, including Richmond, Atlanta, and Chicago, experienced modest growth. (Market Watch, June 4)
  • Commercial construction and real estate activity also declined overall, with the office sector continuing to lag. In San Francisco, construction activity remained subdued due to uncertainty over trade policy and rising material costs. (The Fed, June 4)
  • Tariffs were mentioned 122 times in the report, compared to 107 times in April, reflecting rising concerns about inflationary pressures. (CNBC, June 4)
  • In Boston, the Fed noted deals took longer to close, and “foreign investors grew generally skittish about investing in the United States.”

Economic Conditions & CRE

  • This week, during Lument’s webcast, “Turning Point: Multifamily Strategies Amidst Policy and Economic Shifts,” RER’s President & CEO Jeffrey DeBoer discussed how federal policies, including tariffs, liquidity, and the ongoing tax debates in Washington, are reshaping investor strategies.
  • DeBoer also emphasized that uncertainty and volatility are hindering investment decisions, mirroring the Beige Book’s findings of delayed business spending.
  • RER’s Q2 Sentiment Survey reflected similar caution, with the index falling to 54 as executives cited policy uncertainty, rising costs, and muted investor confidence—echoing the Beige Book’s insights on slowing activity and elevated economic risk. (Roundtable Weekly, May 23)
  • On Wednesday, the administration doubled tariffs on steel and aluminum imports from 25% to 50%, adding further pressure on construction costs and heightening unpredictability. (BisNow, June 4)
  • In the May edition of ULI’s Economist Snapshot, RER’s Senior Vice President Clifton E. “Chip” Rodgers Jr. weighed in on how rising tariffs and trade tensions are impacting U.S. commercial real estate—from delayed development timelines to increasing construction costs and reduced foreign investment. (ULI, May 13)

What’s Next

The Fed will consider the Beige Book findings at its June 17–18 meeting as it navigates a delicate balancing act between persistent inflation risks and ongoing trade tensions.

Senate Republicans Grapple with Details of Tax and Spending Bill

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With Congress back in session this week, Senate Republicans got to work on ironing out the details of their version of the budget reconciliation package. Members of the upper chamber are signaling a number of changes to the House’s bill, which could complicate Speaker Mike Johnson’s (R-LA) fragile coalition.

State of Play

  • Majority Leader John Thune (R-SD) met with President Trump at the White House on Monday, initiating a series of calls from Trump to individual GOP senators to discuss their concerns for the House-passed reconciliation package. (Punchbowl News, June 4)
  • The Senate GOP caucus met Wednesday afternoon to speak about the portions of the legislation that had already been or are on the cusp of being released. Among the most contentious issues: Medicaid, the state and local tax (SALT) deduction cap, and Inflation Reduction Act (IRA) energy tax credits. (Politico, June 3)
  • Finance Committee member Sen. Thom Tillis (R-NC) is one of several GOP lawmakers who has voiced interest in adjusting the phaseouts of certain IRA energy tax credits with a more “targeted” approach to protect U.S. businesses—including real estate—that are already invested in existing projects. (NBC News, June 6)
  • Fiscal hawks Rand Paul (R-KY) and Ron Johnson (R-WI) have already expressed opposition to the bill because it doesn’t contain enough spending cuts or do enough to address budget deficits. (WSJ, June 4)

Potential SALT & Business Tax Changes

  • On Wednesday, Senate Finance Committee members met with President Trump to discuss possible changes to the tax section of the bill. During the meeting, Senators briefly touched on their intention to try to revise the House’s proposal to raise the cap on SALT deductions for individuals to $40,000. 
  • Speaking to reporters outside the White House, Majority Leader Thune said he and his colleagues “start from a position that there really isn’t a single Republican senator who cares much about the SALT issue.” Thune went on to concede that he and other GOP senators “understand that it’s about 51 and 218, so we will work with our House counterparts and with the White House.”(Politico, June 4)
  • “We are sensitive to the fact that, you know, the speaker has pretty narrow margins, and there’s only so much that he can do to keep his coalition together. At the same time it wouldn’t surprise people that the Senate would like to improve on their handiwork,” Sen. Todd Young (R-IN) told reporters. (Politico, June 4)
  • The bulk of tax writers’ Wednesday meeting with the president, however, focused on a different issue: Trump is not sold on making several proposed business tax breaks permanent, including 100 percent bonus depreciation for equipment, machinery, and nonresidential property improvements.
  • Trump told Sen. Johnson and other members of the Finance Committee that it could be better for economic growth to make the provisions temporary, providing a more immediate incentive for businesses to take advantage of them. (Politico, June 5)

Section 899

  • Another area of debate that has emerged among Senate tax writers concerns Section 899, which would impose steep retaliatory taxes—up to 50 percent—on foreign taxpayers from countries that discriminate against U.S. businesses through their own tax regimes. (Roundtable Weekly, May 30)
  • If enacted in its current form, in addition to taxing foreign companies, Section 899 could raise tax rates on passive foreign investment in the U.S. (CNBC, June 2; Kirkland and Ellis, June 5)
  • Congress’ Joint Committee on Taxation has asserted that the “retaliatory tax” could in effect lead to a decline in foreign demand for U.S. assets and lower U.S. tax revenue (Bloomberg, May 30) 
  • In the short term, however, the provision is projected to raise significant revenue—$120 billion over the first five years. (Politico, June 4) 
  • Senators are reviewing potential changes and modifications to section 899 to address concerns. “There’s a lot of nervousness about how it could be used,” Sen. James Lankford (R-OK) told reporters, indicating that Republicans “want to make sure there’s not some unintended consequences.” (Semafor, June 4)

Implications for CRE

  • Senate tax writers, thus far, have not signaled significant interest in changes to priority issues like the deductibility of property taxes (business SALT) or carried interest.
  • The Senate is considering potential Roundtable-backed improvements to the House-passed Opportunity Zone provisions, as well as reforms to the low-income housing tax credit, the new markets tax credit, and a longer extension for provisions related to bonus depreciation and business interest deductibility.
  • An RER working group is analyzing Section 899’s impact on real estate and working to ensure policymakers understand its potential unintended consequences, which could include deterring foreign investment in large-scale, capital-intensive real estate and infrastructure projects in the U.S. (Roundtable Weekly, May 30)

Looking Ahead

While a few Senate committees have already released their sections of the bill, the Senate Finance Committee is expected to share their draft of the tax portion next week. RER will continue to update its members on key changes and their impacts on the commercial real estate industry during what will surely be an eventful month in Washington as the Senate works toward passing their reconciliation package by July 4.

Multi-Industry Coalition Urges ENERGY STAR Support

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Today, The Real Estate Roundtable (RER) joined a broad coalition of manufacturing, consumer technology, retail, and real estate allies in a letter to Congress urging continued federal support for the overwhelmingly bipartisan ENERGY STAR program. (Letter, June 6)

Cross-Sector Advocacy Push

  • The coalition letter emphasized that ENERGY STAR has delivered hundreds of billions of dollars in energy savings since its inception—approximately $40 billion in annual savings alone for American consumers, families, and businesses. 
  • More than 30 leading organizations signed today’s letter including RER, many real estate partners, and manufacturing, consumer products, and retail groups. They include the Air-Conditioning, Heating and Refrigeration Institute (AHRI); American Chemistry Council (ACC); Consumer Technology Association (CTA); National Association of Manufacturers (NAM); National Retail Federation (NRF); National Electrical Manufacturers Association (NEMA); and the Retail Industry Leaders Association (RILA).
  • The multi-industry letter also highlights ENERGY STAR’s brand as a highly successful, non-regulatory, and bipartisan public-private partnership that promotes energy efficiency and consumer trust across industries that drive the U.S. economy.
  • The industry letter stated that ENERGY STAR is fundamental to an “all of the above” energy strategy, crucial for accommodating growing electricity demands from artificial intelligence, crypto assets, and advanced manufacturing. (Letter, June 6)

Real Estate Sector Support

  • The real estate industry previously sent letters to Congress, the Department of Energy (DOE), and the Environmental Protection Agency (EPA) explaining the importance of ENERGY STAR focusing on U.S. commercial and residential buildings. (Roundtable Weekly, May 23) (Letters: May 23, May 14, and April 4)

  • In response to indications that the Trump Administration might eliminate ENERGY STAR as federally managed, RER President and CEO Jeffrey DeBoer commented the program “is integral to the U.S. real estate industry. Its software is embedded in the fabric of how profitable, energy efficient buildings are run and managed in all markets across the nation.”
  • “ENERGY STAR provides the key tools for families and business to save money on their utility bills,” DeBoer continued. “Owners and developers rely on ENERGY STAR to attract investment capital so U.S. building infrastructure can compete with the best real estate assets in the world.” (Roundtable Weekly, May 9)

Press Coverage

  • A recent op-ed in The Hill made the economic case for ENERGY STAR, arguing that its elimination would raise operational costs, disrupt performance standards, and weaken a public-private partnership that delivers measurable benefits to businesses, consumers, and the environment. (The Hill, May 31)
  • A former Republican EPA Administrator who helped create ENERGY STAR in the 1990s commented that the energy efficiency and waste avoidance goals of the program “should make a DOGE bro swoon.” (Washington Post, May 14). 

RER will continue to advocate with aligned groups in the real estate sector and across industry lines to preserve ENERGY STAR as a voluntary, federal public-private partnership.

House-Passed Reconciliation Bill includes Potential New Taxes on Foreign Investors

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The One Big Beautiful Bill Act approved by the House of Representatives last week would raise tax rates on foreign governments, firms, partnerships and individuals from any foreign country that imposes “unfair foreign taxes.”

Proposed Section 899

  • The so-called section 899 “retaliatory tax measures” legislation was a significant topic at this week’s Real Estate Roundtable Tax Policy Advisory Committee (TPAC) meeting. A discussion of the legislation was led by Baker McKenzie partner Alexandra Minkovich. (Proposed Section 899 Presentation)
  • Unfair foreign taxes are broadly defined in the legislation to include digital services taxes, diverted profits taxes, and certain tax rules adopted by countries pursuant to OECD model rules for taxing multinational businesses (“Pillar 2”), as well as taxes that the Treasury Secretary determines are extraterritorial, discriminatory, or intended to be born disproportionately by US persons.
  • The legislation would raise the applicable treaty or non-treaty tax rate by 5%/year, up to the maximum statutory tax rate plus 20%.   (WSJ, May 30)
  • Countries or regions widely considered targets of the legislation because of their adoption of either digital services taxes or Pillar 2 undertaxed profits rules include the U.K., Canada, the E.U., Australia, and Japan. 

Implications for CRE

  • If enacted, the legislation could have implications for U.S. real estate because of its application to sovereign wealth funds, foreign insurance companies, and passive investors that provide an important source of equity investment for large-scale, capital-intensive U.S. real estate and infrastructure projects. It could have a chilling effect on inbound investment decisions.
  • According to CBRE, foreign investment in U.S. real estate increased by 40 percent between the second half of 2023 and the second half of 2024. (CBRE, March 2025)
  • Chye-Ching Huang with the NYU Tax Law Center recently told the New York Times that the legislation would “create a new front in the U.S. tariff war with its closest economic partners, extending that to taxes and investment.” (New York Times, May 21)
  • The provisions in the House bill draw heavily from legislation introduced by House Ways and Means Chairman Jason Smith (R-MO). They are estimated to raise $116 billion over 10 years. It is unclear whether they have the full support of key Senators. Also, because they implicate foreign relations and treaty commitments, they could face parliamentary challenges under Senate rules.

At the TPAC meeting this week, Committee Chair Josh Parker (Chairman & CEO, Ancora Group Capital), announced the formation of a working group to analyze the legislation’s impact on real estate and ensure policymakers fully understand the potential unintended consequences of the bill.  

GSE Reform Discussions Resurface as President Trump Signals Push to Take Fannie Mae and Freddie Mac Public

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After nearly 17 years in government conservatorship, Fannie Mae and Freddie Mac may be heading for a significant shift. President Donald Trump recently indicated he is considering taking the government-sponsored enterprises (GSEs) public, renewing efforts to release them that began during his first administration.

GSE Reform

  • Trump emphasized that any transition would retain the federal government’s implicit guarantees. “I am working on TAKING THESE AMAZING COMPANIES PUBLIC, but I want to be clear, the U.S. Government will keep its implicit GUARANTEES, and I will stay strong in my position on overseeing them as President,” Trump said in a post on Truth Social. (Axios, May 27)
  • The GSEs have been in federal conservatorship since 2008, and the administration has not yet detailed how the proposed transition would work.
  • Congressional action would likely be required to change their legal status.
  • “Interestingly, the president has not said anything that he wants to end conservatorship,” Federal Housing Finance Agency (FHFA) Director Bill Pulte said during a CNBC interview. “We’re studying actually potentially keeping it in conservatorship and taking it public.” (Barrons, May 29)
  • Pulte said he would be meeting with Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick about potential options for the two entities. (Bloomberg, May 29)
  • Experts warn that without careful implementation, privatization could increase mortgage rates. Both Bessent and Pulte have said they will not support a GSE release that results in higher costs for borrowers.
  • The limited government guarantee is critical to attract private capital without spiking borrowing costs, and support for affordable and underserved housing must remain a priority, regardless of ownership structure, say the National Multifamily Housing Council (NMHC) and the National Apartment Association (NAA).
  • RER supports sensible GSE reform that preserves and strengthens America’s housing infrastructure, ensuring financial stability and continued liquidity for ownership, rental housing, and underserved markets. (Roundtable Weekly, May 23)

View from the Hill

  • While no active GSE reform legislation is under consideration in Congress, lawmakers from both parties are seeking more clarity from the administration.
  • Senate Banking Committee members have signaled interest in a structured release, with Senate Republicans expressing cautious optimism and Senate Democrats raising concerns about potential disruptions to an already stressed housing market. (CBS News, May 27)
  • Sen. Mark Warner (D-VA) expressed support for a “smart release plan that wouldn’t disrupt the market.” (Punchbowl News, May 27)
  • “You do this the wrong way, you’re going to screw up a housing market that’s already teetering because of lack of supply,” said Warner. (PoliticoPro, May 23)
  • Sen. Kevin Cramer (R-ND) stated, “I’d want to see the plan, I’d want to talk about transition.”
  • House Financial Services Committee Chairman French Hill (R-AR) noted that “certain important reforms are only possible through statutory changes,” reinforcing that Congressional involvement will likely be necessary.

RER will remain actively engaged on GSE reform through our working group and housing and coalition efforts. We encourage members to provide input as we continue to monitor developments and advocate for policies that support liquidity, stability, and affordability in the housing finance system.

Senate to Debate Changes to Reconciliation Bill

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With Congress back in session next week, the Senate is gearing up to take on the House’s reconciliation package and potentially make significant changes to the bill. Meanwhile, the Trump administration is expected to release further information on its FY2026 budget.

Senate to Take Up One Big Beautiful Bill Act

  • “This bill is far from over, but we are pleased the House bill maintains current law on business property and income tax deductibility, carried interest, and Section 1031 exchanges, while also improving Opportunity Zones, the Low-Income Housing Tax Credit, and taxation of pass-through entities,” said Jeffrey DeBoer, President and CEO of The Real Estate Roundtable (RER). “As the Senate takes up this bill we plan to work to preserve these provisions.  We are also highly focused on eliminating the ‘retaliatory tax’ on foreign investment, as well as improving other aspects of the bill.”
  • The Senate is back in session Monday and eager to put its mark on the massive reconciliation package. The next four weeks will involve crucial tax negotiations on a variety of key provisions, including Inflation Reduction Act (IRA) energy tax incentives, state and local tax (SALT) deductions, Medicaid, and more. There are also procedural hurdles that the Senate bill must overcome.
  • Speaker Mike Johnson (R-LA) implored his Senate colleagues to avoid making major changes to the bill, saying, “If it wasn’t obvious for them, I wanted them to know the equilibrium that we reached is so delicate… My hope and my encouragement to them is – fine tune this product as little as possible.” (Punchbowl News, May 26)
  • Difficult compromises based on countless hours of negotiations were made to get the House bill across the finish line. If the Senate makes drastic changes, it could force negotiators back to the drawing board on certain issues and make it more difficult to meet the GOP’s goal of getting the reconciliation bill to President Trump’s desk by July 4. (Punchbowl News, May 29)

Expected Changes to the Reconciliation Bill

  • Early reports indicate that Senate leadership will seek only minor modifications to the House’s bill, rather than sweeping changes. But some senators are pushing for much more. (Punchbowl News, May 23)
  • Procedural changes: The Senate’s Byrd Rule requires that only budget-related items are included in the reconciliation process. As a result, some minor provisions could be stripped out. (Axios, May 28)
  • Tax additions: The Senate is also expected to switch the bill from a “current law” to a “current policy” baseline, allowing the Senate to permanently extend key tax cuts expiring this year. This would give Senate tax writers more space to include other tax provisions, including the Tax Cuts and Jobs Act’s (TCJA) 100 percent bonus depreciation.
  • Energy tax incentives: Multiple GOP senators have advocated for protecting the IRA energy tax incentives, including Sens. Lisa Murkowski (R-AK) and Thom Tillis (R-NC), who sits on the Senate Finance Committee and wants to moderate the House’s rollback of the tax credits. (Politico, May 23)
  • These modifications could include extending some tax credits that the House bill proposed eliminating, or expanding the timeline for their phase-out to ensure that the change does not strand energy projects already in progress.

Other Potential Changes

  • Medicaid cuts: Sens. Josh Hawley (R-MO), Susan Collins (R-ME), and others have taken issue with the House bill’s Medicaid cost-cutting measures, including expanded work requirements and other changes. (The Hill, May 28)
  • Deficit debate: A group of deficit hawks, including Sen. Ron Johnson (R-WI), are pushing for far deeper spending cuts than the House bill proposes, and have criticized it for not sufficiently reducing the deficit. Sen. Rand Paul (R-KY) also called the spending cuts in the House bill “wimpy and anemic.” (Axios, May 25)
  • Pressure from President Trump was crucial to getting deficit hawks in the House to back down from their opposition to the lower chamber’s bill. It remains to be seen whether conservatives concerned about the deficit in the Senate will put up more of a fight.
  • Debt limit: The Senate could increase the debt limit hike in the bill from $4 trillion to $5 trillion, ensuring that the next debt limit fight doesn’t happen until after the 2026 midterms. However, this proposal has also faced opposition from Sen. Rand Paul. (Politico, May 25)
  • Overall, Senate Majority Leader John Thune (R-SD) has his work cut out for him in order to hammer out the differences in opinion within his caucus. He can only afford to lose three GOP senators. It will take immense effort and deft political maneuvering to meet their aggressive July 4 goal.

Looking Ahead

  • Trump’s FY2026 budget request is expected to be released next week, kicking off a renewed budget battle after the administration’s skinny budget proposed in early May received pushback from both sides of the aisle. (Reuters, May 2)

RER will continue to engage with policymakers to ensure that the commercial real estate industry has a seat at the table in the critical Senate negotiations to come.

Industry Leaders Discuss Economic Outlook, Policy Priorities, and Geopolitical Challenges at Annual Meeting

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The Real Estate Roundtable’s (RER) 2025 Annual Meeting this week included discussions with public officials and industry leaders on a range of issues affecting commercial real estate, including market conditions, tax policy, the House’s recent passage of the One Big Beautiful Bill Act, tariffs and trade, affordable housing solutions, energy policy, and evolving security threats.

Roundtable Leadership

  • RER Chair Kathleen McCarthy (Global Co-Head of Blackstone Real Estate, Blackstone) opened the meeting by thanking members for their consistent engagement and highlighting the significance of RER’s collaborative efforts in navigating a rapidly evolving policy landscape. (May 2025 Policy Priorities and Executive Summary)
  • During the meeting, RER members approved the nominees for its FY26 board of directors and policy advisory committee officers, which were announced by RER Nominating Committee Chair Geordy Johnson (CEO, The Johnson Group).
  • Addressing the membership, RER President and CEO Jeffrey DeBoer emphasized RER’s ongoing commitment to enhancing member involvement through RER’s policy advisory committees and underscored the value of strategic partnerships with other national real estate organizations for proactive policy advocacy. (Meeting Agenda)

Meeting Speakers

  • The Honorable Kevin Hassett (Director, National Economic Council) presented the administration’s economic agenda, focusing on housing initiatives, factory expensing, and the outlook for growth.
  • (L-R): Hessam Nadji (President and CEO, Marcus & Millichap), Martha Gimble (Executive Director, The Budget Lab at Yale University), and Jonathan Pollack (President, Starwood Capital Group) provided macroeconomic insights, reviewed current and future CRE market trends, and spoke about challenges amidst tariff-induced uncertainty. (Hessam Nadji Presentation | Martha Gimble Presentation)
  • Anna Palmer (Founder & CEO of Punchbowl News) offered her perspective on legislative developments and negotiations, and the rise of influential figures within both political parties.

Policy Advisory Committee Meetings

  • Each of RER’s policy advisory committees met this week in conjunction with the Annual Meeting for in-depth policy discussions. The committees hosted several congressional staff and regulatory officials.

Sustainability Policy Advisory Committee (SPAC) Meeting

  • SPAC Chair Anthony E. Malkin (Chairman and CEO, Empire State Realty Trust, Inc.), Co-Vice Chairs Ben Myers (Vice President, Sustainability, BXP) and Katie Rothenberg (Vice President, ESG, AvalonBay Communities, Inc.) led discussions on EPA’s ENERGY STAR program, grid reliability, clean energy procurement, and nuclear energy deployment. (Agenda & Speakers)

Tax Policy Advisory Committee (TPAC)

  • TPAC Chair Josh Parker (Chairman & CEO, Ancora Group Capital), Vice Chair David Friedline (Partner, Deloitte Tax LLP), and the Committee discussed the broad range of tax proposals affecting real estate that are working their way through Congress in the budget reconciliation bill. Panelists included senior staff from the offices of the House Speaker, Ways and Means Committee, Senator Tim Scott (R-SC), and Senator Todd Young (R-IN), as well as the Treasury Department. In addition, tax experts from Baker McKenzie, Sullivan & Cromwell, and Brownstein led or moderated discussions concerning potential new taxes on foreign investors, regulatory initiatives, and Opportunity Zones.  (Agenda & Speakers)

Sustainability Policy Advisory Committee (SPAC)

  • SPAC Chair Anthony E. Malkin (Chairman and CEO, Empire State Realty Trust, Inc.) and Vice Chairs Ben Myers (Vice President, Sustainability, BXP) and Katie Rothenberg (VP, ESG, AvalonBay Communities, Inc.) led discussions on (Agenda & Speakers)

Joint Real Estate Capital Policy Advisory Committee (RECPAC) and Research Committee Meeting

  • D. Michael Van Konynenburg (President, Eastdil Secured) provided an overview of conditions in real estate credit and capital markets.
  • Following a national policy update from RER’S Ryan McCormick (SVP & Counsel, RER) and Chip Rodgers (SVP, RER), Research Committee Chair Spencer Levy (Global Chief Client Officer & Senior Economic Advisor, CBRE) and Darin Mellot (Vice President of Capital Markets Research, CBRE) led a discussion on the evolving post Liberation Day impact of tariffs on commercial real estate markets. 
  • Robert Rubano (Executive Vice Chairman, Head of Equity, Debt, & Structured Finance, Cushman & Wakefield) moderated a capital market roundtable with David Bouton (Co-Head of U.S. CMBS, Citigroup), Jack Gay (Senior Managing Director, Global Head of Real Estate Debt, Nuveen Real Estate), Kathryn Ogden, (Head U.S. Corporate Banking and Global Head, Real Estate Capital Partners (RECP), RBC Capital Markets), and Matt Salem (Partner, Head of RE Credit, KKR). (Agenda & Speakers)

Homeland Security Task Force (HSTF) Meeting

  • HSTF Chair Amanda S. Mason (Executive Director, Global Intelligence, Related Companies) facilitated a number of discussions on the current threat picture.  These discussions included a review of the risks to commercial facilities from lithium-ion batteries with John Frank (AXA XL Risk Consulting). The meeting also included a series of briefs from the FBI regarding the threats from terrorist and transnational criminal organizations that are directly threatening U.S. citizens and commercial facilities. These discussions included updates on the role of the cartels in violent crime, the deaths of American citizens from synthetic opioids, and the facilitation of nearly three million illegal migrant arrivals in 2024, putting U.S. communities at risk. Also addressed were the range of cyber and intelligence threats from China, targeting our critical infrastructure. (Agenda & Speakers)

RER’s 2025 Annual Report will be distributed in July. Next on RER’s FY 2025 meeting calendar is the Fall Meeting, which will take place on October 27-28 (restricted to Roundtable-level members only).