Tariffs Reshape Southern California's Industrial Market
📦 How Tariffs Are Shaping Southern California’s Industrial Real Estate Market
By Gary Martinez, CCIM, SIOR
As global trade dynamics continue to shift, one factor has re-emerged as a key influence on Southern California's industrial market: tariffs. From manufacturing to logistics and warehousing, tariffs are reshaping where businesses operate, how goods move, and which submarkets are most vulnerable — or positioned for growth.
To visualize these dynamics, I created an interactive ArcGIS Story Map that breaks down the geographic impact of tariffs across Southern California, using NAICS data and industry-specific layers to highlight where risk and opportunity truly lie.
🔍 Which Cities Face the Highest Exposure?
Industrial hubs closest to global trade gateways — particularly the South Bay, Inland Empire West, and central Los Angeles County — are showing the highest levels of exposure to tariff-sensitive industries. Cities like Carson, Vernon, Commerce, Ontario, and Chino are packed with manufacturers, wholesalers, and distribution centers whose business models rely on international imports.
These areas also feature dense concentrations of businesses in NAICS sectors 31–33 (Manufacturing), 42 (Wholesale Trade), and 48–49 (Transportation and Warehousing), all of which are heavily influenced by tariff policy. A sudden shift in trade costs or import restrictions can ripple across these regions, impacting vacancy rates, rent growth, and capital investment.
🟢 Where Are the Safer Zones?
On the other hand, cities like Yorba Linda, Lake Forest, San Dimas, West Covina, Yucaipa, and Laguna Hills have shown lower exposure. While many of these communities contain light industrial and flex space, their economies are more service-driven, less dependent on global supply chains, and generally more insulated from international policy changes.
For tenants seeking long-term stability or investors looking to diversify away from high-volatility markets, these cities may represent lower-risk alternatives as trade conditions evolve.
📈 What This Means for CRE Investors, Tenants, and Developers
Tariffs are more than just a trade issue — they’re a spatial economic force. They influence where businesses cluster, how supply chains are routed, and how capital is deployed in industrial real estate. Understanding where tariff exposure is most concentrated allows investors, brokers, and developers to make smarter, more resilient location decisions.
Whether you're repositioning an asset, advising a tenant, or scouting the next logistics park, this geographic lens can be a powerful tool for market intelligence.
💡 Explore the Interactive Story Map
I invite you to explore the full Story Map here:
👉 View the Map
The map includes a swipe tool to visually compare cities with the highest and lowest tariff exposure, along with insights into the NAICS sectors driving the data.
If you have questions, insights, or want to collaborate on a similar analysis — feel free to reach out. I’d love to hear how others in the commercial real estate community are navigating these evolving conditions.
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