At ICSC Las Vegas, the resounding cry was ‘Tariffs-Schmariffs'
The Terrible Tariffs. That’s the hot topic looming over every big industrial trade show in the land this year. Yet neither developers nor retailers seemed overly steamed about it at last week’s ICSC show in Las Vegas.
“Retailers, of course, have the tariffs on their minds, but what we’re hearing from them at the show is that they’re not pausing their expansion plans,” said Chris Maguire, chairman and CEO of SRS Real Estate Partners at his crowded booth on the show floor.
“Retailers can’t afford to pause,” said the man whose company serves more than 400 national brands. “The decisions we’re making with them here are for stores that are going to open two, three, or four years from now. Who’s going to make a bet on what the landscape will look like then?”
Kevin Kessinger, president and COO of Trademark Property, said that, if there is a pause in investment on the part of retailers, it won’t have much to do with concerns about the consumer or the economy.
“It will have to do with uncertainty,” Kessinger said. “Uncertainty over the tariffs and not knowing how it’s all going to turn out. I’m someone who never bets against the American consumer. We may see some softness there, but I don’t think that’s the headwind.”
Kessinger is not the only landlord expressing economic optimism for the second half of 2025.
“My sense is that retailers are still pretty optimistic about this year, and I think the landlord community is, as well,” said Anthony Cafaro, Jr., co-president of Cafaro Company, a nationwide owner-operaor of super-regional malls in middle markets. “There's not a risk of increasing interest rates. We're seeing the opposite happening, so that's good news for both the consumer and the retailer.”
The retailers that will weather that storm best are the ones with the most diversified supply chains, according to NewmarkMerrill CEO Sandy Sigal.
“In today’s environment, we have two kinds of retailers—one that has a diversified supply chain and one that doesn’t,” Sigal noted. “The one that has a diversified supply chain is going to be able to capture and keep customers because of its pricing. In a competitive landscape, they’re going to be better positioned for the long term if the tariff problem endures.”
Kristen Mueller, JLL’s president of retail property management, observed that few retail chains have put the brakes on new real estate deals, though they are acting more slowly in getting deals done.
“No matter what may be affecting the economy, retailers always have to make inventory decisions,” she said. “Do we go ahead and pay a tariff today, or do we wait a week to watch for a change in the macro environment? Tariffs or no tariffs, they make those decisions every day using the best information they have and yet sometimes still get them wrong. No one can know for sure if this week or next week is going to work.”
Carmen Spinoso, whose Spinoso Real Estate Group owns and/or operates more than 50 regional malls in the United States, expressed some surprise that this year’s ICSC Las Vegas was business-as-usual.
"I expected that I would hear more concern about tariffs and China and supply chain, but interestingly, that has not been the topic of the conversations we've had," Spinoso said. "In fact, it's been quite the opposite. Retailers have been coming into the booth saying, 'We need to open 35 new stores. We need to open 50 new stores.' So the appetite for new store openings continues to remain very strong and, with one or two minor exceptions, we've not really heard much about macroeconomic concerns."
Adam Ifshin, whose DLC Management owns and operates large open-air centers across the eastern half of the United States was surprised that the tariffs rarely entered the conversations he had with retailers in Las Vegas.
“I don't want to say that retailers are like ‘damn the torpedoes’ on tariffs, but they are,” Ifshin remarked. “They are getting direction from their senior-most management that we're going to figure out a way to navigate our way through this. I’m hearing, ‘Our sales volumes are strong, but our store fleets are aging. We have white space out in the market. I need new stores or I can’t do any more volume.’”
CoStar’s national director of retail analytics Brandon Svec observed that retail centers continue to be the darlings of investors due to the lack of new construction of space.
“There really aren’t enough quality spaces,” he said. “So bankers are back to liking retail again. They recognize that the fundamental strength of the sector isn't shifting anytime soon. The supply, demand, and balance that we're in isn't going anywhere for the next 5 years at least, and the bankers recognize that, so they're actively actually lending on retail again.”
One benefactor of this situation is Tri-Land Properties, a Chicago-based developer known for high-quality repositioning of underperforming retail shopping centers in the Midwest, Mid-Atlantic and Southeast regions.
“What little new construction we’re seeing is happening in communities where average household incomes are $110,000. All the developers putting up centers are fighting each other trying to buy the same property,” said the company’s president, Rich Dube.
Tri-Land’s properties are mostly found in neighborhoods where household incomes are around $60,000. Many of the towns are filling with immigrant populations, and Tri-Land benefits from municipalities eager to fund redevelopment and raise their sales tax bases.
“We just finished a shopping center that had a 104,000-sq.-ft. Price Chopper that we reduced to 70,000 sq. ft.,” said Dube. “The city gave us $12 million in terms of tax increment financing and community investment. They and we now have a great new center.”
Tariffs be damned!
