A major escalation in the White House’s trade agenda this week introduced new tariffs on imports from major global partners—while sparing Canada and Mexico in a move important for construction and development.

Recap

• On Wednesday, President Trump announced a minimum 10 percent tariff on imports from most countries, set to take effect Saturday. In addition, individualized, “reciprocal” tariffs that apply to specific countries will take effect next Wednesday, including raising overall tariffs on China to 54 percent. (White House, April 2)
  
  
• While Canada and Mexico did not receive any new tariffs, other key trading partners were affected. The European Union was hit with a new 20 percent tariff, along with Japan (24 percent) and South Korea (25 percent), spurring a statement from the European Commission President indicating that plans for countermeasures are in motion. (Reuters, April 3)

• The tariff exceptions for Canada and Mexico are positive for the real estate industry. Canada supplies about 85% of all U.S. softwood lumber imports—nearly a quarter of the total domestic supply in the U.S. Further exempting Mexican products is also a win given major construction cost drivers such as gypsum, concrete and near-shored appliances. (NAHB, April 3)

• National Association of Home Builders Chairman Buddy Hughes said, “While the complexity of these reciprocal tariffs makes it hard to estimate the overall impact on housing, they will undoubtedly raise some construction costs. However, NAHB is pleased President Trump recognized the importance of critical construction inputs for housing and chose to continue current exemptions for Canadian and Mexican products, with a specific exemption for lumber from any new tariffs at this time.” (NAHB, April 3)
  
  
• In TV interviews after the announcement, Treasury Secretary Scott Bessent called for patience to not immediately retaliate and “asking to let’s see where this goes.” (Politico, April 3)
  
  
• Markets and financial experts remain concerned about the ultimate endgame of the tariffs—whether they are meant to be permanent or represent negotiating leverage for the Trump administration to garner better deals with trading partners.

• Speaking with reporters on Thursday, Trump seemed to indicate the latter, saying that “the rest of the world wants to see if they can make a deal.” (NBC News, April 3; Forbes, April 3)

Implications for CRE

• Tariffs may present several challenges for commercial real estate, including increased construction costs, potential project delays, and heightened uncertainty among investors. (CBRE, March 19 | Roundtable Weekly, Feb. 14)

• Higher tariffs on imported Chinese steel and aluminum will raise structural material costs, increasing expenses for developers and complicating efforts to address the housing shortage. (Roundtable Weekly, Jan. 24 | Nov. 27)

• New tariffs also threaten to escalate energy costs by disrupting supply chains and raising prices for essential clean-tech components, underscoring the need to prioritize energy conservation strategies in commercial buildings. (E&E News, April 3 | NYT, April 3 | Forbes, March 20)

• Embracing efficiency measures such as EPA’s ENERGY STAR program is now more important than ever—ensuring grid reliability, controlling operational costs, and unleashing American energy dominance amid growing economic pressures. [See ENERGY POLICY story below]

For now, deep uncertainties around trade and the administration’s tariff strategy leave long-term planning for investment and development in limbo. This latest round of tariffs is unlikely to be the last. RER will continue to track coverage on tariffs, and the implications for commercial real estate.

This week saw a major announcement from President Trump on sweeping new tariffs and movement in Congress as the Senate advances a compromise budget resolution, with big implications for tax and spending cuts.

Budget Resolution Moves Forward

• During his tariff announcement, President Trump announced his “complete and total support” for a compromise budget resolution released on Wednesday. The statement came after Senate Budget Committee Chair Lindsey Graham (R-SC) unveiled the updated resolution, paving the way for a vote later this week. (Punchbowl News, April 3)
  
  
• Trump’s public support for the budget resolution was the result of behind-the-scenes negotiations with Senate leadership to move the reconciliation process forward.
• Senate Majority Leader John Thune (R-SD) and others in the administration brought the meeting together to alleviate the concerns of skeptical deficit hawks who believed the Senate’s budget resolution didn’t do enough to cut spending. (Punchbowl News, April 3)
  
  
• After receiving assurances from Trump about his support for large-scale deficit reductions, Senators John Kennedy (R-LA) and Ron Johnson (R-WI) seemed to get on board with the compromise budget resolution. With key holdouts resolved, Majority Leader Thune appears to have the votes needed to get the resolution adopted. (CNN, April 2)
  
  
• The budget resolution includes separate spending cut instructions for the House and Senate. While House committees are instructed to find $1.5 trillion in spending cuts, the Senate instructions only call for $4 billion. Senate GOP leaders indicate that they still plan to target $1.5 to $2 trillion in spending cuts, giving them greater flexibility but punting lingering issues down the road. (Politico, April 3)
  
  
• A “vote-a-rama” on the budget resolution is expected to begin Friday evening, with final adoption anticipated early Saturday. (Politico, April 2)

Tax Policy Implications

• The compromise budget resolution incorporates a “current policy baseline” approach that allows the 2017 tax cuts to be permanently extended without needing to offset roughly $4 trillion in costs.
  
  
• The Senate version also authorizes $1.5 trillion in additional tax relief beyond making the tax cuts permanent, allowing tax writers to include other key provisions that business advocates are asking for.
  
  
• The current policy baseline was another sticking point in the Senate resolution that has been punted to later in the process. Senate GOP leadership has opted to assert that the Budget Committee Chair has the authority to choose the baseline used in reconciliation. (Axios, April 1)
  
  
• While this decision allows the compromise budget resolution to move forward, the parliamentarian could still rule on the issue later on. If the parliamentarian rules against the current policy baseline, it would dramatically change the budget resolution landscape and potentially force the GOP to enact a shorter-term extension of the 2017 tax cuts, rather than making them permanent.
  
  
• The current policy baseline also has political implications. Responding to the Senate resolution, House Budget Committee Chair Jodey Arrington (R-TX) and other House tax writers expressed concern that the Senate budget resolution could add as much as $5.3 trillion to the debt. (Politico, April 2)
  
  
• House Speaker Mike Johnson (R-LA) was more optimistic about the compromise budget resolution and the inclusion of the current policy baseline, saying, “We’re in the consensus-building business here… So we’ll have to socialize this with our members and see. Look, I think there’s a large number of House Republicans who expected that would be the final outcome… so it’s not a big surprise.” (Punchbowl News, April 3)
  
  
• In a conversation with Punchbowl News this week, Chairman of the House Financial Services Committee French Hill (R-AR) emphasized that President Trump and House and Senate GOP leaders are united on the urgency to get the reconciliation package done.
  
  
• Rep. Hill also strongly defended the current tax treatment of carried interest. “It’s not a loophole,” he said, calling it an “important component for long-term finance across the country” for many businesses, including commercial real estate, venture capital and energy. (Punchbowl News, April 3)
  
  

Looking Ahead
The coming weeks are a critical time for the administration and congressional leaders on key issues, including trade and tax policy. RER will continue to engage with policymakers to advocate for pro-growth policies that support investment, job creation and healthy real estate markets.

The Real Estate Roundtable (RER) wrote to the sponsors of the Opportunity Zone tax incentives encouraging them to extend and improve the tax benefits, which have successfully mobilized private investment in historically underserved communities. The letter to Senator Tim Scott (R-SC) and Representative Mike Kelly (R-PA) emphasizes the need for a long-term extension and targeted reforms to maximize OZs’ economic impact. (Letter)

CRE Impact

• Since their enactment in 2017, OZs have spurred billions in private investment to revitalize distressed communities, finance affordable housing, and create jobs.

• 72% of U.S. counties contain at least one OZ. By the end of 2022, the OZ tax incentives had helped mobilize $84.7 billion in investment for low-income areas. More recent estimates suggest OZs have attracted over $120 billion in capital. (Letter)

• RER members have leveraged OZ funding to develop affordable housing, retail centers, office buildings, and life sciences facilities.

Roundtable Policy Recommendations

Under current law, the OZ tax benefits are phasing down and will expire altogether for new investments made after December 31, 2026. First and foremost, RER is advocating for a long-term extension of OZ tax benefits to spur continued investment and provide certainty to the private sector. Additional recommendations include: provide certainty to the private sector. Additional recommendations include:

• Removing limitations on the type of capital eligible for investment in opportunity funds to allow a broader range of capital to flow into OZ investments;

• Adding a new incentive for commercial-to-residential conversions to address housing shortages;

• Establishing a rolling deferral period for new OZ investments to sustain long-term interest;

• Improving the OZ working capital safe harbor to accommodate large-scale real estate developments;

• Modifying the substantial improvement threshold to encourage redevelopment of vacant properties; and

• Creating reporting and transparency requirements to track OZ impacts more effectively.

What’s Next

• As Congress considers major tax legislation in 2025, long-term OZ reforms should be a priority to unlock additional private capital and sustain revitalization efforts in low-income communities.

• Next week, HUD Secretary Scott Turner, an outspoken advocate for the OZ program will be a speaker at our Spring Roundtable Meeting. His recent tour of Philadelphia's OZs showcased the transformative impact of public-private partnerships in revitalizing distressed areas. (Fox News, March 30)

RER will continue engaging with lawmakers to advance these recommendations and ensure Opportunity Zones remain a powerful tool for economic development.

The Real Estate Roundtable (RER) and industry partners voiced strong support for Environmental Protection Agency’s (EPA) ENERGY STAR program in a letter to Administrator Lee Zeldin this week—urging continued support for the voluntary, market-driven platform that underpins building efficiency, grid reliability, and energy cost savings. (Letter)

Why It Matters

• Commercial real estate relies more on ENERGY STAR than any other voluntary federal public-private partnership. It provides CRE’s standard tool to track and reduce building energy use—supporting lower utility bills, smart cap ex investments, and reduced regulatory red tape. (Letter)

• “Real estate assets that do more with less energy – as quantified, monetized, and recognized though Portfolio Manager and other ENERGY STAR offerings – are critical to achieve EPA’s pillars to “power the great American comeback,” the letter stated.

Facts and Stats

• More than 330,000 buildings—representing nearly 25% of U.S. commercial building floor space—utilized EPA’s Portfolio Manager software last year.

• ENERGY STAR-certified buildings achieve an average of 35% less energy usage compared to similar non-certified buildings.

• The program has saved businesses and families nearly $200 billion in utility bills since 1992, including $14 billion in 2024 alone.

Driving the Energy Comeback

The real estate industry letter how ENERGY STAR supports EPA goals to:

• Restore Energy Dominance and Competitiveness: Helps reduce operating costs, ease grid strain, and boost building global competitiveness.

• Support Cooperative Federalism: Serves as a unifying national platform across varied state and city energy rules.

• Lead in AI Innovation: Electricity savings supported by ENERGY STAR, combined with American-made energy of all types, are requisite to meet the massive demands for power we need to lead the world in AI innovation.

Energy Hearings on Capitol Hill

• Congressional committees held a series of energy-related hearings over the past two weeks, zeroing in on grid reliability, domestic supply, and the mounting electricity demands from artificial intelligence and data infrastructure.

• On April 2, a House oversight subcommittee held a hearing titled, “Unleashing the Golden Age of American Energy Dominance.” The hearing addressed the need to unlock “all of the above” U.S. energy resources to drive economic growth. (Press Release, April 2)

• Another House subcommittee dealing with energy policy held a hearing, “America’s AI Moonshot: The Economics of AI, Data Centers, and Power Consumption,” AI industry leaders and lawmakers discussed expediting energy permitting and power needed by data centers to support AI innovations. (PoliticoPro, April 2 | PoliticoPro, April 1)

• Last week, the CEOs of the nation’s grid operators in competitive electricity markets testified at a House Energy Subcommitee hearing, "Keeping the Lights On: Examining the State of Regional Grid Reliability." Witnesses explained that power demands are forecasted to exceed grid capacity and reinforced the need to reduce burdensome regulations to generate new power supplies. (Chairman Latta (R-OH) Statement, March 25)

RER remains committed to continued collaboration with EPA to advance the ENERGY STAR program as part of the administration’s 'all of the above' energy strategy, and goals to make the grid more resilient and reliable.

The Real Estate Roundtable mourns the loss of Donald B. Susswein, a longtime member, brilliant tax expert, and dedicated mentor who passed away April 2.

• Don served as a partner in RSM's Washington National Tax office, where he helped build the firm’s Passthrough Tax Consulting Capability and guided many colleagues into leadership roles — a source of immense pride for him.

• His distinguished career also included roles at two Big 4 firms, a partner at Thacher Proffitt and Wood, a Wall Street law firm, the U.S. Senate Finance Committee, and the Department of Justice.

• Throughout his years with RER, Don was a driving force behind our Tax Policy Advisory Committee (TPAC), offering his expertise through monthly calls, studies, panels, and helping craft amicus briefs that helped advance our tax policy priorities. Don was a key architect of the partnership audit reform legislation enacted in 2015 and a major contributor to the development of the pass-through business income deduction enacted in 2017.  His work revolutionized the way the tax community thinks about like-kind exchanges (as part of a broader continuum of deferrals available for business restructurings).  From FIRPTA, to cancellation of indebtedness, to unrealized gains, Don tackled many other difficult issues through The Roundtable. 

• Roundtable President and CEO Jeffrey DeBoer said, “Don was a genius — a brilliant problem solver and a loyal, supportive friend. His clever comments and contagious smile brought levity and clarity to even the most complex policy debates. I’ve known Don since the mid-1980s, when he was already recognized on Capitol Hill as one of the true tax policy sharpies. If you wanted to discuss tax legislation with Don you had to bring your “A” game, even so his game was always “A-plus”. We will deeply miss his voice at The Roundtable, especially in our tax policy deliberations.”

• Roundtable Senior Vice President and Counsel Ryan McCormick said, “Don was a mentor, coauthor, and friend who brought tremendous wit and wisdom to every complicated tax issue we tackled.  Don delighted in the opportunity to solve the unsolvable, and he often succeeded.  From partnership audit reform to section 199A to like-kind exchanges, Don brought ideas and insights that challenged traditional thinking, transformed debates, and led Congress to enact better laws.  Don made many selfless contributions to The Roundtable and our industry, but it is his kindness and steadfast friendship that will be most missed.”

A funeral service is scheduled for Tuesday, April 8 at the Garden of Remembrance Chapel in Clarksburg, MD with a live stream available. In lieu of flowers, a donation in his memory can be made to the Special Olympics, Young Artists of America, and Donate Life DC. (See Obituary for details)