After nearly a year of navigating the most volatile trade policy environment since World War II, the retail industry got a historic court ruling last Friday — and a new tariff within hours. For those of us on the front lines of retail real estate, the lesson is clear: the uncertainty is the strategy.

The Supreme Court’s 6–3 decision in Learning Resources, Inc. v. Trump struck down all IEEPA-based tariffs on February 20, ruling that the International Emergency Economic Powers Act does not authorize the President to impose tariffs. The effective U.S. tariff rate dropped from 16% to 9.1% — the lowest since 1947, but still nearly six times the pre-2018 baseline of 1.6%. That lasted less than 24 hours.

By Friday evening, the administration had signed a proclamation invoking Section 122 of the Trade Act of 1974, imposing a global 15% import surcharge — the statutory maximum — effective February 24, 2026 and running through July 24 unless Congress acts to extend it. The Yale Budget Lab calculates the current effective tariff rate at 13.7% — still the highest since 1941, still roughly 8.5 times the pre-2018 norm.

The Numbers Behind the Headlines

Let me be specific, because this is where the abstract policy debate becomes very concrete for retailers and the landlords who lease to them.

Source: Yale Budget Lab, February 21, 2026. Note: The 9.1% floor reflects Section 232 tariffs on steel, aluminum, and autos plus Section 301 tariffs on China — neither of which were affected by the IEEPA ruling.

On the household cost impact, there are two numbers worth knowing. Yale Budget Lab calculates that if Section 122 expires as currently scheduled on July 24, the price-level hit translates to a loss of $600–$800 per average household. If Congress extends or makes the tariffs permanent, that figure rises to $1,000–$1,300. Separately, the National Retail Federation — in a forward-looking study based on the proposed tariff structure — projected that the overall tariff regime would cost American consumers $46–$78 billion annually in lost purchasing power across apparel, toys, furniture, household appliances, footwear, and travel goods. Those aren’t abstract numbers — they represent real compression in consumer spending across the exact categories that drive foot traffic to shopping centers.

On the refund question: don’t underwrite your next deal around it. The Supreme Court’s ruling opens the door for importers to file claims against the over $160 billion in IEEPA tariffs already collected, but the Penn Wharton Budget Model, Telsey Advisory Group, and virtually every trade attorney I’ve read have said the same thing — those refunds are likely tied up in litigation for years. Plan for a 9.1% floor, hope for an update, but don’t count on a check.

What We’re Seeing on the Ground in NY Metro

Here’s the counterintuitive reality: the NY metro retail leasing market entering this period of heightened tariff uncertainty is the tightest it has been since tracking began. That structural supply scarcity provides a significant buffer — but it doesn’t make retailers immune to the cost pressure.

Manhattan prime corridor availability hit a record-low 13.7% in Q4 2025 — down from a pandemic peak of 28% in 2021. Long Island, where we do significant volume, is operating below 5% vacancy with essentially zero new construction in the pipeline. There are simply fewer available boxes than there were two years ago, and that dynamic doesn’t reverse quickly regardless of what happens with tariffs.

Prime asking rents rose 6.7% year-over-year to $584 PSF on average across Manhattan’s key corridors (JLL). SoHo’s Broadway is the standout — up 24–26% YOY to $726 PSF. Madison Avenue asking rents hit $982 PSF, the highest since 2019. On Long Island, Nassau County mid-sized retail rents are up 11.3% year-over-year. Lease velocity tells the same story: transactions that took months to close are resolving in weeks, and tenants are willingly committing to 10–15 year terms.

The Bifurcated Tenant Market: Who’s Growing, Who’s Pulling Back

This is the most important strategic read I can offer landlords right now. The tariff environment is accelerating a rotation that was already underway — away from import-heavy specialty retail and toward categories that are either tariff-resistant by business model or selling goods with inelastic demand.

The 150-Day Clock: What Landlords Should Watch

Section 122 tariffs expire July 24, 2026 — that’s the number I’d put on your calendar. Under the Trade Act, Congress can extend them, but only by affirmative vote. If Section 122 sunsets, the effective rate drops to 9.1%. That would provide meaningful relief to furniture and footwear retailers who’ve been most compressed, potentially reviving some expansion plans that have been paused.

But here’s the harder reality: even at 9.1%, we’re still operating at roughly six times the pre-2018 norm. Retailers have already been forced to restructure their supply chains. Leases they didn’t renew are gone. Expansion plans that were suspended may not simply restart. Some of the category rotation we’re experiencing isn’t a temporary tariff shock — it’s a permanent restructuring of which tenants make sense for which spaces.

For NY metro landlords, the strategic posture right now is clear: lean into the categories that are growing and tariff-resistant. Grocery anchors, off-price concepts, fitness operators, and food service are all actively seeking quality space. The boxes being vacated by department stores, specialty apparel, and footwear retailers are real opportunities to upgrade your tenant mix — if you move decisively.

My Take: Operate in the Fog, But Keep Moving

After nearly 30 years of watching this market through multiple cycles — the dot-com bust, 9/11, the financial crisis, COVID — I’ve learned that the landlords and tenants who fare best are the ones who make decisions with the best available information, even when conditions are uncertain. Waiting for perfect clarity is a strategy that usually means watching from the sidelines while others transact.

The data tells a nuanced story. Yes, tariff costs are compressing margins in vulnerable categories. Yes, decision timelines on renewals and new leases are stretching. But the underlying NY metro retail market is the tightest it’s been in our firm’s 48-year history. Prime space is not sitting available. Rents in the corridors that matter are rising. The tenants expanding most aggressively — discount, grocery, fitness, food service — are exactly the operators who drive consistent foot traffic and support mixed-use shopping environments.

The market will find its equilibrium. It always does. In the meantime, the brokers and advisors who understand both the macro trade picture and the hyper-local NY metro dynamics will be the ones creating value for their clients. That’s what we intend to keep doing.

Data sources: Yale Budget Lab (Feb 21, 2026); JLL NYC Retail Q4 2025; Cushman & Wakefield; REBNY H2 2025 Manhattan Retail Report; Matthews/CoStar Q4 2025; National Retail Federation; FDRA; Coresight Research; CNBC; Retail Dive; Wells Fargo Equity Research; Telsey Advisory Group. All figures reflect market data as of publication date.