Immigration
As the U.S. doubles down on stricter immigration policies, the aftershocks aren't limited to border towns or Capitol Hill debates. These shifts ripple through the economy, and commercial real estate (CRE) is starting to feel the tremors.
From labor shortages in construction to dwindling consumer foot traffic in immigrant-dense corridors, commercial landlords, developers, and investors may need to reassess their forecasts. Immigration isn’t just a political lightning rod, it’s a real estate demand driver, and right now, that driver is hitting the brakes.
The U.S. population is aging. Fast. According to the U.S. Census Bureau, by 2034, older adults will outnumber children for the first time in American history. Without a steady influx of younger immigrants, our workforce and consumer base shrinks.
For CRE, this means weaker long-term demand for multifamily housing, fewer retail transactions, and slower economic activity around office and industrial assets in urban areas that traditionally thrive on immigrant labor and spending.
Neighborhoods once powered by immigrant-owned small businesses are seeing vacancies climb. In cities like Los Angeles, Miami, and New York, all deeply dependent on foreign-born populations, this demographic shift isn’t hypothetical, it’s already unfolding. According to a 2024 Pew Research Center report, net international migration added only 1 million people in 2023, down sharply from pre-2016 trends.
Multifamily developers are beginning to feel the pinch as well. Lower immigration numbers mean fewer new households forming, especially in urban Class B and C buildings, which traditionally cater to immigrant communities. Meanwhile, retail corridors in ethnic enclaves, such as Koreatown in LA or Little Havana in Miami, are reporting slower leasing activity as immigrant entrepreneurs face visa delays or rejections.
How about ground-up developments and value-add projects? Who's building them? Tightened immigration policy is choking the construction labor pipeline. Per The Associated General Contractors of America (AGC), 85% of contractors reported difficulty finding qualified workers in 2024 (source). A large portion of this workforce has historically included immigrants, both documented and undocumented.
As the labor pool dries up, so do construction timelines. CRE developers are facing longer delivery schedules, cost overruns, and in some cases, halted projects. This hits everything from mixed-use developments to warehouse buildouts and slows the overall market velocity.
You might assume that logistics and warehousing, darlings of the CRE world post-2020, are immune. Think again.
Immigration curbs are affecting truck drivers, warehouse staff, and service providers that grease the gears of e-commerce. While automation is slowly picking up slack, it’s nowhere near replacing the human backbone of America’s distribution network. According to a 2024 Brookings Institution analysis, immigration shortfalls are already impacting warehousing operations in key hubs.
Interestingly, some city governments are pushing back. New York City and Chicago have launched pilot programs to provide support for newly arrived migrants, not just out of humanitarian concern, but to counteract workforce gaps and keep local economies afloat
Immigration policy isn’t just politics, it’s economics. Fewer immigrants mean fewer renters, fewer shoppers, fewer workers, and fewer deals.
CRE markets tied to immigrant populations are already feeling it. Demand’s softening, timelines are dragging, and some submarkets may stall altogether.
At Eve Capital, we follow how economic and political policies show up as early warning signals in CRE. When population growth slows, CRE sectors feel it. No people = no profit. If you're not adjusting your strategy, you're already behind. We can help you form a strategic plan, whether you are looking to reposition an asset that is being affected or maximize your profit by riding the wave of change. Let’s talk.
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