Even South Florida’s most active condo developer can’t avoid being caught in the middle of the changing-by-the-day tariff policies of the Trump administration.
Related Group bought $2M worth of tiles from Asia for one of its projects last month, swallowing a 25% tariff to ship them to the U.S., Related Group Executive Vice President Patrick Campbell said at Bisnow’s Broward County State of the Market event on Thursday.
If it had waited a week, the import levy would have been a far more manageable 10%, Campbell said.
“It was a huge, huge issue, and when we first started realizing what’s happening, we’re saying, ‘Don’t ship it, don’t ship it. We don’t want it. We’ll take the deposit, do whatever you want,’” Campbell said. “It’s far better than actually having to pay the duty once it gets here.”
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K Group Holdings’ Joseph Kavana, Related Group’s Patrick Campbell, Moderno Development’s Doron Broman and H2M’s Greg Cellamare.
Tariff unpredictability, rising construction costs and fluctuating interest rates are making it harder for developers, and their lenders and investors, to plan ahead. But navigating the unknown has become part of doing business, industry professionals said at the event, held at Fort Lauderdale’s Downtown Event Center.
“We’re kind of in a time where decisions are still being made daily, and we’re not certain how it’s going to affect things overall,” Campbell said.
In the two months since President Donald Trump held his “Liberation Day” tariff announcement at the White House, markets around the world have struggled to find their footing. Different products and countries have been faced with different tax rates at different times, and some of the policies have been blocked, then reinstated by federal courts.
While the final outcome of the policies is still impossible to predict, the uncertainty has had an impact in the bond markets, and Federal Reserve officials are holding their benchmark interest rates steady for fear that cutting rates now would worsen inflation.
Developers are hoping for interest rate relief sooner rather than later, but founder and managing partner of Moderno Development Doron Broman said he’s already written off 2025 — a setback that’s weighing on property values and making new projects harder to justify.
“I’m like an addict: Every day I look at the 10-year note, at least twice a day or three times a day, and hopefully it’s starting to move down, but it’s not,” Broman said. “It’s probably going to take some time.”
The wild swings have made it difficult for contractors to make decisions and price risk, especially with prices climbing sharply, reaching an annualized jump of 9.7% in the end of the first quarter, Construction Dive reported in April.
The 10-year Treasury yield still has the potential to climb to 5%, threatening to put projects on ice, according to a CBRE analysis.
“Construction costs are an ongoing thing,” Campbell said. “We’re still trying to figure out what tariffs are going to do.”
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Edens’ Nicole Shiman, Stiles’ Rocco Ferrera, Linkvest Capital’s Camilo Niño, Falcone Group’s Alfonso Costa Jr. and Greenberg Traurig’s Jonathan Gelman.
On the financing side of the deal, traditional lenders have pulled back and developers are increasingly leaning on private financing because they are the only ones willing to lend, said Camilo Niño, CEO and founder of co-investment platform Linkvest Capital.
Even now, with banks coming back into the lending space as they have started to rid themselves of troubled property loans, they’re not comfortable financing new construction, panelists said.
“I thought that with the new president and the promise of deregulation, I thought that the bank was going to become more aggressive again, and that is not happening,” Niño said. “Neither the regulation, neither the willingness of the banks to lend.”
The uncertainty has also rippled through South Florida’s foreign investment landscape, with international buyers skittish about where policy and rates are headed next, keeping their capital on the sidelines, Niño said.
Alfonso Costa Jr., chief operating officer of the Falcone Group and former deputy chief of staff at the Department of Housing and Urban Development, said foreign condo buyers at his projects have paused to assess the current environment. He’s not alone — international buyers spent $2B less on Miami condos in 2024 than they did in 2023, and real estate agents say 2025 has been even slower.
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The Estate Cos.’ Jeffrey Ardizon, Cymbal DLT’s Hector Delatorres, Newgard Development Group’s Bromley Kelley, Marsh’s Matthew Maffai and BMO Commercial Bank’s Shawn Oden.
“I think that given the political climate and the general macroeconomy, regardless if you’re foreign or domestic, most folks are taking a step back, a pause, and trying to understand the evolving landscape,” Costa said.
Even as investors remain on the sidelines, Niño said capital will eventually return, drawn by South Florida’s appeal and the relative safety of the U.S. economy.
Investors aren’t alone in the decision to lay low.
Many retailers who sources their products from China are hitting pause on lease commitments, with big-box tenants in particular waiting for more clarity before making moves, Edens Managing Director Nicole Shiman said.
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Fort Lauderdale Mayor Dean Trantalis, Pompano Beach Mayor Rex Hardin, Oakland Park Mayor Tim Lonergan, Hollywood Mayor Josh Levy and Broward County Mayor Michael Udine.
The first quarter of this year saw the slowest pace of shopping center leasing since 2020, when pandemic lockdowns shuttered retail stores, which has created real challenges for operators.
“The threat of tariffs, or the reality of tariffs, has a real, legitimate impact on our retailers,” Shiman said. “We’ve seen in the course of just a business plan and executing our business, there a lot of retailers out there who are saying, ‘Pencils down.’”
Uncertainty has become the biggest challenge in real estate, Niño said, because it’s a long-term investment and it’s hard to make decisions without a clear sense of where things are headed.
“When there is a lot of uncertainty, people don’t make decisions or delay decisions,” Niño said. “And that’s become a reinforcing issue, because everybody is waiting for something, and nobody knows what we’re waiting for.”