The Trump administration’s trade war with China in particular and its tariffs on aluminum and steel are both starting to ripple through the Boston area’s hospitality, real estate development, transportation, and tourism sectors.
Those in the industries say they fear rising business costs because of the tariffs will either stymie major projects or force them to pass those higher costs on to consumers in the form of increased rents, asking prices, and transit fares. (And it’s not exactly inexpensive to build in Boston to begin with.)
Those involved in tourism in the Boston area also say that the very fact of such an international brouhaha between the U.S. and other countries could dampen foreign visits and therefore the use of hotels and such attractions as the duck boat tours.
Chinese tourists, for instance, comprise about 15 percent of all international travelers to the area—and account for more than one-third of all tourist spending.
Will they or won’t they keep coming and spending in such numbers? And what about the flow of raw material such as steel for the region’s much-vaunted building boom—and its major infrastructure projects, including the Green Line extension through Somerville?
Such uncertainty could end up as much a challenge as the rising costs and any declining tourism numbers themselves. “This kind of uncertainty is really very bad,” a principal at HYM Investments, the folks behind the massive Bulfinch Crossing development in downtown Boston, told the Globe.
For now, companies and contractors are planning ahead, building higher costs due to any tariffs into contracts. Whether and when these costs get passed on to tenants, buyers, et al, remains to be seen. As for tourism, that’s also wait-and-see. Stay tuned.
- Trade war tensions stress state tourism officials [Herald]
- Tariffs are making it more expensive to build in Boston—and that could push rents even higher [Globe]
- Major Boston development: 9 projects transforming the city [Curbed Boston]
- 11 reasons to be optimistic about Boston right now [Curbed Boston]
- Boston housing prices: Why they’re so high [Curbed Boston]