The rhythm of global trade is faltering along the Southern California coast. Ship calls are down, goods are stockpiling, and tenants are scrambling to adapt as U.S. tariff policies shift rapidly.
The Port of Los Angeles, the busiest port in the country, reported a 30% year-over-year drop in import volumes during the first week of May, with 17 of 80 vessel calls canceled for the month.
This decline follows the imposition of steep tariffs on Chinese imports, which were later reduced from 145% to 30% for a 90-day period starting May 14. The temporary nature of this reprieve has created significant uncertainty for importers, Port of Los Angeles Executive Director Gene Seroka said at a news conference this week.
“For now, vessel utilization is down, bookings are inconsistent, and short-term planning is the only kind that exists," Seroka said.
Developers and landlords say warehouse leasing activity has slowed, with some tenants pausing deals or shifting requirements forward to lock in space early. Others are adjusting their prices, products and even the ports they ship to in order to hedge against future tariff volatility.
The Port of Long Beach, America’s second-busiest container port, is also experiencing a slowdown. After a record-setting April, officials expect imports to decline by more than 10% in May.
“The effects will be felt beyond the docks,” Port of Long Beach CEO Mario Cordero said in a statement.
New port patterns
Companies that rely on stable shipping windows are now juggling rerouted cargo, inconsistent schedules and unpredictable costs tied to tariff shifts.
CapRock Partners Executive Vice President Bob O’Neill, who oversees acquisitions across the Western U.S. for the Newport Beach-based industrial development firm, said the volatility has forced his team to shift into observation mode.
“We’re just trying to be as prudent as we can, checking in with tenants about exposure to Asian markets and getting out in front of things,” O’Neill told CoStar News. “But it changes every three days.”
Pedro Niño, vice president of research and investment strategy at industrial property firm Clarion Partners, noted that importers began accelerating shipments and moving up space requirements at the end of last year to get ahead of tariff hikes.
“We’re hearing from tenants who want to offset tariff risk through all available levers: diversifying sourcing, changing port strategies and reevaluating lease timing,” Niño told CoStar News.
Clarion has paused speculative development in key trade corridors, including Southern California, and is adjusting lease-up timelines and rent growth assumptions to reflect market volatility.
Meanwhile, some logistics operators are signing short-term contracts at two to three times market rates to secure access to bonded space, which allows importers to store goods without paying levies until those goods are distributed, according to JLL Senior Managing Director Danny Reaume.
"Some 3PLs that used to receive just a few inquiries a month are now handling more than 100 in two weeks," Reaume told CoStar News.
For now, Southern California’s logistics backbone continues to function, but on shakier footing. Port executives, developers and importers alike are preparing for a volatile peak season marked by reduced inventories, higher prices and longer decision cycles.
“This port is resilient, but the uncertainty is real,” Seroka said.