Billy Bastek, executive vice president of merchandising for the Atlanta-based home-improvement retailer, said during an earnings call this week the company is planning for “modest price movement” across some product categories during the second half of this year. Tariffs rates on some items have increased significantly this year, although the company will work to keep prices competitive broadly, Bastek said.
Although tariffs have not yet had a major impact on inflation, according to Consumer Price Index data, it’s may only be a matter of time before their impacts begin to be seen in the CPI and other readings.
Other retailers have said they plan to raise prices in response to tariffs, including children’s retailer Carter’s, payments company NCR Voyix and soft-drink giant The Coca-Cola Co.
On the map: A closer look at potential Opportunity Zones in the revamped program
Opportunity Zones 2.0 is coming — and real estate investors are expected to have a lot fewer certified tracts to pick from this go around.
That’s because the sweeping federal tax-and-spend legislation enacted in July changed the criteria included in the previous OZ program in a way that ultimately will shrink the number of eligible areas, reports The Playbook‘s Andy Medici.
By the numbers: In the original program, passed during Trump’s first term as part of the Tax Cuts and Jobs Act of 2017, 42,176 census tracts were eligible to become designated Opportunity Zones. Ultimately, governors in each state and territory picked 8,764 of those locations to be OZs. But, according to an analysis of the new criteria that was applied to census tracts and the most recently available poverty data, about 26,000 tracts could meet the eligibility criteria for an Opportunity Zone designation under the parameters of the revamped program. If governors were to then pick the maximum-allowed 25% of those sites to be Opportunity Zones, that would mean about 6,500 zones in the program.
Medici mapped the potentially eligible OZs in the upcoming program, which can be viewed here. The federal government has not yet published an official list of eligible tracts under the new law, and governors will be able to pick OZs by July 2026.
Carey Heyman, managing principal of industrial and real estate at CliftonLarsonAllen, said in an email to Medici the narrowed eligibility for the upcoming program is a “double-edged sword.”
“On one side, the revised criteria aim to refine the program’s focus and better align with its original intent, which is driving capital into truly distressed communities,” Heyman said. “On the other side, this restriction may come at the cost of the program’s momentum.”
Tech giants hunt for Bay Area industrial space
Technology groups in industries like artificial intelligence aren’t only propping up the San Francisco Bay Area’s office market — some tech companies are eager to snap up industrial space in the area.
That’s because the market is seeing an influx of manufacturing and hardware tenants that need space to build self-driving cars, create precision manufacturing facilities for chips that power AI models and assemble robots, reports Sarah Klearman at the San Francisco Business Times.
And big names in the space, including Amazon and Alphabet’s Waymo, are zeroing in on San Francisco specifically — as opposed to outlying submarkets that’ve historically been more popular for industrial users — to be close to the AI boom that’s overtaken the city.
They said it: “Being in San Francisco has become much more meaningful for all kinds of technology tenants,” said Robert Sammons, senior director of research at Cushman & Wakefield. Manufacturing tenants seemingly “popped up out of nowhere the last year,” he added.
In fact, in the area, Cushman is now newly tracking a category it calls production, distribution and repair, or PDR, space — last year, it was tracking one tenant seeking about 3,000 square feet of such space in San Francisco, but at the end of July, nine tenants seeking a total of 655,000 square feet of PDR space were in the market.
Most tenants seeking PDR space are looking for at least 100,000 square feet, and sources tell Klearman a space-robotics division of Amazon has been touring spaces in San Francisco and the San Francisco Peninsula. Amazon declined to provide details when reached.
Building slows in some high-growth markets
It probably doesn’t come as a surprise to anyone, given the national slowdown we’ve seen in the for-sale housing market and new challenges thanks to volatile tariff policy, but homebuilding starts are down, even in red-hot growth markets.
Adding it up: Housing data company Zonda recently found there were 250,541 future lots in the Austin, Texas, metro — a 12% year-over-year increase and a 46% increase since 2020. About 91% haven’t been touched. On top of that, Austin’s annual home starts are down 15% year over year, much higher than other Texas cities: Houston is down 1%, Dallas is level and San Antonio is up 4%.
Developers told Justin Sayers and Cody Baird at the Austin Business Journal the biggest reason for the slowdown is economics — efforts to bring prices down to a point palatable for them and buyers are complicated by the minimum sale-price threshold needed to make a profit. A lengthy entitlement and building timeline, the costs of land and other factors are also making homebuilding complicated.
Garrett Martin, CEO of Austin-based homebuilder MileStone Community Builders LLC, said Austin is at a point where supply is increasing but it’s still challenging for both the consumer and developer.
“As such, that’s putting a lot of pressure on pricing, and it’s creating a situation where more people are renting rather than buying, which is frankly unfortunate because peoples’ homeownership tends to be overwhelmingly their path to wealth in life,” Martin said.
Less new construction will eventually put more pressure on home price, as we know constrained supply while demand is strong — or even begins to pick up again in the future — will increase competition for homes already built.
Building boomtowns: Some places around Austin are seeing a sizable amount of new home construction relative to their size and current inventory, headlined by Kyle (with nearly 44,000 homes) and Georgetown (nearly 32,000), Sayers and Baird also report.
Source: “The National Observer: Construction Slows in High Growth Markets“
