Tag: Tax Policy

Government Shutdown: What It Means for CRE

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The federal government shut down on Wednesday—the first lapse since 2019—with no deal in sight. Both chambers are at an impasse after dueling stopgap funding bills failed again this week. (AP News, Oct. 2)

State of Play

  • Senate Democrats blocked Republicans’ “clean” Nov. 21 continuing resolution (CR). Republicans rejected Democrats’ version that included extending enhanced Affordable Care Act subsidies and reversing Medicaid cuts.
  • Senate Majority Leader John Thune (R-SD) and Minority Leader Chuck Schumer (D-NY) may meet Friday in their first one-on-one since the standoff began. Another round of votes is planned for Friday. (Punchbowl News, Oct. 2)
  • If Democrats block the GOP plan again, Majority Leader Thune is expected to adjourn the Senate until Monday, canceling Saturday votes, and force another vote on Monday. (Punchbowl News, Oct. 2)

CRE Impact

  • NFIP: The National Flood Insurance Program (NFIP) cannot issue new policies or renewals during the shutdown, threatening thousands of real estate transactions. The Real Estate Roundtable (RER) supports a long-term, sustainable NFIP reauthorization to avoid recurring market disruptions. (Roundtable Weekly, Sept. 19)
  • Senate Banking Committee Chair Tim Scott (R-SC) “remains committed” to funding the program and is “optimistic” Democrats will join Republicans to prevent a lapse in coverage during peak hurricane season, his spokesperson said. (Politico, Sept. 30)
  • Energy: The ENERGY STAR program has halted partner application processing, product list updates, and specification releases—stalling efficiency certifications important to building owners and tenants. Meanwhile, it remains unclear how the shutdown will affect EPA Administrator Lee Zeldin’s broader reorganization and regulatory timeline. (PoliticoPro, Sept. 30, Oct. 1 | NAHB, Oct. 1)
  • Housing: HUD is unable to access certain funds used to prevent evictions in its Tenant-Based Rental Assistance Program. Affordable housing initiatives also face delays due to the furloughing of program staff. (Politico, Sept. 30)
  • Construction: Fallout from the shutdown is also reverberating through the construction sector, where contractors warn that halting federal projects will ripple into private markets by raising costs and eroding confidence. (UtilityDive, Oct. 1)
  • Tax Policy & Treasury: Despite the shutdown, Treasury has said it will continue implementing President Trump’s tax law and deregulatory agenda, relying on multi-year funding streams. Its tax policy office will remain active, advancing the president’s tax cuts and regulatory rollbacks. Other Treasury operations—including debt management, collections, and oversight of financial markets will also continue. (PoliticoPro, Sept. 29)
  • “Government shutdowns and temporary extensions of essential programs like the NFIP create avoidable uncertainty that disrupts real estate markets and undermines economic confidence,” said RER President & CEO Jeffrey DeBoer. “Congress should act responsibly by providing long-term solutions that protect communities and the American people, encourage investment, and sustain growth.”

As the shutdown continues, mounting strain on real estate transactions, insurance coverage, and investment planning will intensify pressure on Congress to resolve the impasse.

Congressional Democrats Reintroduce Bill to Tax Unrealized Gains

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Senate Finance Committee Ranking Member Ron Wyden (D-OR) introduced the bicameral Billionaires Income Tax Act this week with support from 20 Senate Democrats. The legislation mirrors the version first introduced by Sen. Wyden in 2023, and would tax the appreciation of wealthy individuals’ assets. Identical legislation was introduced in the House by Reps. Donald Beyer (D-VA) and Steve Cohen (D-TN). (PoliticoPro, Sept. 17)

Billionaires Income Tax Act (BITA)

  • Under BITA, tradable, liquid assets would be marked-to-market and taxed annually on their appreciation, while illiquid assets would be subject to a “deferral recapture” tax when sold—or if certain other currently nontaxable events occur, such as death, a transfer to a trust, or a like-kind exchange. (Bill text | Press release | One-pager, Sept. 17)
  • The bill would apply to taxpayers with more than $100 million in annual income or more than $1 billion in assets for at least three consecutive years. (PoliticoPro, Sept. 17)
  • The legislation is not limited to future appreciation of assets. It would also apply to accumulated, unrealized gains at the time of enactment. Tax on these built-in gains could be paid over five years.
  • Additional rules would govern unrealized losses, as well as assets held in partnerships.

Roundtable View      

  • Real Estate Roundtable (RER) President and CEO Jeffrey DeBoer said: “Taxing unrealized gains would upend over 100 years of federal taxation, require an unprecedented IRS intrusion into household finances, and create harmful unintended consequences. Deferring taxes until assets are sold supports entrepreneurs while encouraging long-term investment and productive risk-taking. This proposal lacks broad policy support, carries considerable risk, and should be rejected.”
  • Past attempts at wealth taxes in other countries have also collapsed—largely abandoned due to administrative problems, lack of public support, and minimal impact on income distribution (Roundtable Weekly, 2023)

Roundtable Spotlight

  • At the American College of Real Estate Lawyers (ACREL) Annual Meeting this week, RER’s Ryan McCormick (SVP & Counsel) and DeBoer highlighted how the One Big Beautiful Bill (OB3) Act supports jobs, economic growth, investment, and avoids harmful tax changes. They also discussed the nation’s housing shortage and the future of Fannie Mae and Freddie Mac.
  • Longtime and revered RER President’s Council member Jay Epstien received the Fred Lane Award for his lifetime of contributions to the real estate legal profession at the ACREL meeting.

McCormick was also a featured speaker on the Engineered Tax Services webinar this week to discuss the OB3 Act and its wide-ranging implications for commercial real estate, including permanent extensions of 100 percent expensing, Opportunity Zone incentives, affordable housing credits, and other key provisions. (Watch ETS Webinar)

Roundtable Releases 2025 Annual Report

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The Real Estate Roundtable (RER) is pleased to share our 2025 Annual Report, A New Era for America’s Buildings: Policy to meet increased energy demands, new technology, and evolving living and working environments.

Roundtable Leadership

  • This year’s report highlights how RER’s engagement drove policy wins in tax, capital and credit, housing, energy, and homeland security, amid one of the most intense legislative years in recent memory.
  • It also underscores commercial real estate’s vital role in powering jobs, growth, and communities nationwide, while ensuring our industry’s trusted voice is heard at the highest levels in Washington.
  • “The pace and complexity of policy this past year has been unprecedented, requiring rapid and well-coordinated responses,” said Jeffrey DeBoer, RER President and CEO. “Thanks to the engagement and expertise of our members, policy committees and national real estate partners, we have met each legislative challenge with substance, speed and credibility. I believe the past 12 months have been among the most challenging and most successful in our history.”
  • “In the year ahead, we will continue to evolve how we communicate our mission, align our membership with the future of the industry and focus on the most urgent issues,” said Kathleen McCarthy, RER Chair and Global Co-Head of Blackstone Real Estate. “Real estate anchors our communities and touches every part of American life—from where people live and work to how businesses grow. As the nation faces a housing crisis and urgent energy challenges, public policy must support a strong, resilient real estate sector that drives solutions, fuels economic growth and improves quality of life and opportunity for all.”

Explore the 2025 Report

  • RER’s FY2025 Annual Report details the organization’s mission and recent activities, and offers potential policy solutions to today’s pressing and far-reaching industry challenges, including:

  • Intro — featuring Q&A with Kathleen McCarthy and Jeffrey DeBoer

Printed copies of the Annual Report are currently being mailed to members. If you would like additional copies, please email agrenadier@rer.org

New Tax Law to Spur Housing Construction and Property Improvements as Congressional Leaders Explore Options for Next Tax Bill

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President Donald Trump signed the One Big Beautiful Bill Act (OBBB Act) into law on July 4, the culmination of months of work by congressional Republicans to reshape federal tax and spending policies. The legislation included provisions long advocated by The Real Estate Roundtable (RER), such as a significant expansion of affordable housing tax incentives, accelerated depreciation for property improvements, and reform of tax accounting rules for condominium construction.

RER Summary of Real Estate Related Provisions

Affordable Housing Boost

  • The OBBB Act enacts landmark changes to address the nation’s housing shortage through enhancements to long-standing development incentives. (Roundtable Weekly, July 3)
  • The OBBB Act expands the Low-Income Housing Tax Credit (LIHTC) by permanently increasing state LIHTC allocations by 12% and reducing the private activity bond financing requirement for 4% LIHTC projects from 50% to 25%. The latter provision will allow more affordable housing projects to receive tax credits without a direct allocation from the state.
  • The bill’s overhaul of tax provisions is projected to support the development of up to 1.2 million affordable rental units over the next decade. (PoliticoPro, July 9)
  • These changes to the LIHTC represent “the single largest increase in affordable housing development resources in at least 25 years,” said Peter Lawrence, chief public policy officer at Novogradac. (PoliticoPro, July 9)

Other OBBB Tax Changes Will Stimulate Housing Construction, Property Upgrades, and Real Estate Investment

  • Bonus Depreciation: The new tax law permanently restores immediate 100% expensing of qualifying capital expenditures, including appliances, fixtures, leasehold improvements, and interior improvements to nonresidential property. The provision will encourage capital investment and spur real estate improvements by reducing the after-tax cost of modernizing and upgrading existing properties. (RER Summary of Real Estate Related Provisions)
  • Condominium Construction: OBBB ends a discriminatory tax accounting rule that unfairly created phantom income for condo developers with respect to the pre-sale of units. The prior rule requiring condo developers to use the percentage of completion method of accounting raised hurdles for construction financing and discouraged new housing construction. OBBB will allow developers to use the completed contract method, aligning tax liability with actual receipts.
  • Opportunity Zones (OZs): OBBB permanently extends the Opportunity Zones (OZ) tax incentives, establishes a new designation of OZ census tracts every 10 years, and going forward, creates a 5-year rolling deferral period for capital gains invested in opportunity funds. Since their enactment in 2017, OZs have attracted over $120B in capital for low-income communities, with most investment going towards new housing and other productive real estate development. (Joint Committee on Taxation, 2024; Novogradac, Feb. 2025; Economic Innovation Group, March 2025)
  • On the latest episode of the Walker Webcast’s Most Insightful Hour in CRE, RER member Willy Walker (Chairman and CEO, Walker & Dunlop) and economist Dr. Peter Linneman (Principal, Linneman Associates) discussed the OBBB Act, tariffs, impacts on construction costs, affordable housing, single and multifamily supply, CRE markets, and much more. (Watch Webcast) (ConnectCRE, July 9)

State-Level Initiatives Strengthen Federal Housing Efforts

  • Rising construction costs and ongoing affordability challenges have prompted states to complement federal initiatives like LIHTC.
  • States such as Tennessee, Georgia, and Michigan have introduced innovative financing programs—including state-level tax credits and tax increment financing (TIF), leveraging future tax revenues generated by increased property values to sustainably fund and accelerate housing projects. (GlobeSt. July 11)
  • This week, RER member David O’Reilly (CEO, Howard Hughes Holdings) appeared on CNBC to discuss interest rates, housing market, and consumer demand.
  • Florida will eliminate its longstanding tax on commercial rents effective Oct. 1, 2025, becoming the first and only state to repeal the tax. The move is expected to reduce costs for tenants across office, industrial, and retail sectors, enabling businesses to reinvest capital into operations, local communities, and real estate. (GlobeSt. July 10)

Looking Ahead

  • Senate Finance Committee Chair Mike Crapo (R-ID) said this week that Republicans are eyeing a second party-line reconciliation package this fall to pursue policy priorities left out of the final OBBB Act.
  • “I’ve always been in favor of a three-bill strategy and there’s a ton of things that we need to do,” Sen. Crapo said (Politico, July 9).
  • GOP leaders have discussed reworking provisions flagged by the Senate parliamentarian during OBBB Act negotiations, potentially reviving items such as additional tax reforms and deeper spending cuts.
  • House Speaker Mike Johnson (R-LA) and House Budget Chair Jodey Arrington (R-TX) are also pushing for fall action, though Sen. Crapo cautioned that timelines remain fluid. (Politico, July 8 | Fox News, July 6)
  • “We’ve been planning a second reconciliation bill for the fall attached to the next fiscal year, and then potentially one in the spring,” Speaker Johnson said on Fox News Sunday. “That’s my plan. Three reconciliation bills before this Congress is over. I think we can do that.” (Fox News, July 6)

“Revenge Tax” Provision

  • The final OBBB Act excluded a provision opposed by The Roundtable that would have raised taxes on foreign investment that originated in countries deemed to have unfair tax policies. Proposed Section 899 could reappear, however, if international tax talks to exempt US companies from a global tax deal falter. (Roundtable Weekly,  June 27)

The G7 agreement to agreement is still only a “statement of intent,” with implementation details unresolved, raising the risk that Section 899 could return in a future reconciliation package, according to Tax Notes. “Republicans made clear they’d bring it back if G7 partners slow-walk the deal,” said Danielle Rolfes of KPMG. (Tax Notes, July 10)

Senate Finance Chairman Circulates Draft Tax Legislation as Senate Prepares for Reconciliation Debate

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The Senate Finance Committee released the draft legislative text and a section-by-section summary of its portion of the budget reconciliation bill, encompassing tax cuts, extensions of the 2017 Tax Cuts and Jobs Act (TCJA), and an overhaul of Medicaid. The draft Senate bill has several differences compared to the House-passed One, Big, Beautiful Bill Act.

Why it Matters

  • The 549-page proposal would permanently extend the 20% pass-through business income deduction (Section 199A), 100% bonus depreciation, and the Opportunity Zone tax incentives. (Bisnow, June 16)
  • The Senate bill would also increase the debt ceiling to $5 trillion instead of the $4 trillion that passed the House. (Axios, June 18)
  • The legislation should continue to evolve through upcoming manager’s amendments, as negotiations among Senate Republicans and the White House continue.
  • Senate Finance Committee Chair Mike Crapo (R-ID) confirmed on Tuesday that his panel will not formally take up the sprawling tax package.

CRE Provisions in Senate Bill

Key provisions under Senate consideration include:

  • Section 899 “Revenge Tax” Provisions: Includes retaliatory tax measures on foreign companies and investors similar to the House bill but delaying the effective date until 2027. The draft clarifies that certain lending would be exempt under the portfolio interest exception, but it does not exempt all passive investment in U.S. real estate—an area of continued concern. (Bloomberg, June 17)
  • Opportunity Zones: Permanently extends OZ incentives, establishes recurring 10-year census tract designations, a rolling reset of deferral windows, new Rural OZs, and a phase-in of the 10% basis step-up for reinvested gains. (The Hill, June 16 | BisNow, June 17)

  • Low-Income Housing Tax Credit (LIHTC): Permanently increases state LIHTC allocations by 12% and lowers the private activity bond threshold from 50% to 25%—in line with the House bill.
  • Bonus Depreciation: Permanently extends 100% bonus depreciation for property acquired and placed in service after Jan. 19, 2025.

  • Business Interest Deductibility: Permanently modifies section 163(j) to allow interest deductions based on earnings before depreciation and amortization (EBITDA), effective for tax years after Dec. 31, 2024.
  • Factory Expensing: Provides four years of 100% expensing for factories that begin construction after Jan. 19, 2025, and are placed in service by Dec. 31, 2030.

  • New Markets Tax Credit: Permanently extends the NMTC, which currently expires on Dec. 31, 2025.

  • SALT Cap: Permanently extends the $10K SALT deduction cap for individuals, with negotiations on a larger increase ongoing. The bill retains full deductibility for business property taxes paid by pass-throughs, but limits the amount of state and local income taxes that pass-through owners can deduct through SALT workaround laws enacted in various states.
  • Energy Tax Incentives: Maintains House-passed foreign entity rules and includes a phasedown of the clean electricity investment tax credit. The clean electricity investment tax credit is phased out over three years (100% if construction begins in 2025, 60% if construction begins in 2026, 20% in 2027, and terminated thereafter). Unlike the House bill, the Senate version terminates section 179D for property constructed 12 months after enactment.

Immigration – Gold Card Proposal

  • Last week, President Donald Trump launched TrumpCard.gov for individuals to register for a proposed “gold card” that would grant U.S. permanent residency to eligible applicants for $5 million (Axios, June 11)
  • Announced in February, the plan aims to sell up to 1 million cards, an effort President Trump claims could generate enough revenue to retire the national debt. The website currently only collects basic contact information. (USA Today, June 11)
  • The administration says the program would replace the EB-5 visa, but legal questions remain about whether a new visa program can proceed without congressional approval. (CBS News, June 12)
  • In March, RER sent a letter to Commerce Secretary Howard Lutnick, expressing support for pairing the “Gold card” proposal with the existing EB-5 framework, offering a powerful, dual-track approach that would reform America’s visa system, attract top global talent, and drive foreign investment into strategic, job-creating projects. (Letter, March 11 | RW, March 14)

State of Play

  • Republican leaders are pushing for swift negotiations to revise the Senate tax bill as White House officials hold firm on the July 4 deadline despite mounting GOP skepticism. (Bloomberg, June 17)
  • “We first get 51 senators together and then we’ll see what the House can do,” Sen. John Cornyn (R-TX) said Tuesday, referring to the legislation released this week as “an initial draft.” (PoliticoPro, June 17)
  • Senate Majority Leader John Thune (R-SD) said Wednesday that the chamber is aiming to begin consideration of the GOP’s party-line megabill by mid-next week. (Axios, June 18)

RER remains closely engaged with policymakers on the Hill and the administration on several high-stake policy issues, such as the retaliatory tax measures and the Opportunity Zone provisions.

Senate Republicans Grapple with Details of Tax and Spending Bill

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With Congress back in session this week, Senate Republicans got to work on ironing out the details of their version of the budget reconciliation package. Members of the upper chamber are signaling a number of changes to the House’s bill, which could complicate Speaker Mike Johnson’s (R-LA) fragile coalition.

State of Play

  • Majority Leader John Thune (R-SD) met with President Trump at the White House on Monday, initiating a series of calls from Trump to individual GOP senators to discuss their concerns for the House-passed reconciliation package. (Punchbowl News, June 4)
  • The Senate GOP caucus met Wednesday afternoon to speak about the portions of the legislation that had already been or are on the cusp of being released. Among the most contentious issues: Medicaid, the state and local tax (SALT) deduction cap, and Inflation Reduction Act (IRA) energy tax credits. (Politico, June 3)
  • Finance Committee member Sen. Thom Tillis (R-NC) is one of several GOP lawmakers who has voiced interest in adjusting the phaseouts of certain IRA energy tax credits with a more “targeted” approach to protect U.S. businesses—including real estate—that are already invested in existing projects. (NBC News, June 6)
  • Fiscal hawks Rand Paul (R-KY) and Ron Johnson (R-WI) have already expressed opposition to the bill because it doesn’t contain enough spending cuts or do enough to address budget deficits. (WSJ, June 4)

Potential SALT & Business Tax Changes

  • On Wednesday, Senate Finance Committee members met with President Trump to discuss possible changes to the tax section of the bill. During the meeting, Senators briefly touched on their intention to try to revise the House’s proposal to raise the cap on SALT deductions for individuals to $40,000. 
  • Speaking to reporters outside the White House, Majority Leader Thune said he and his colleagues “start from a position that there really isn’t a single Republican senator who cares much about the SALT issue.” Thune went on to concede that he and other GOP senators “understand that it’s about 51 and 218, so we will work with our House counterparts and with the White House.”(Politico, June 4)
  • “We are sensitive to the fact that, you know, the speaker has pretty narrow margins, and there’s only so much that he can do to keep his coalition together. At the same time it wouldn’t surprise people that the Senate would like to improve on their handiwork,” Sen. Todd Young (R-IN) told reporters. (Politico, June 4)
  • The bulk of tax writers’ Wednesday meeting with the president, however, focused on a different issue: Trump is not sold on making several proposed business tax breaks permanent, including 100 percent bonus depreciation for equipment, machinery, and nonresidential property improvements.
  • Trump told Sen. Johnson and other members of the Finance Committee that it could be better for economic growth to make the provisions temporary, providing a more immediate incentive for businesses to take advantage of them. (Politico, June 5)

Section 899

  • Another area of debate that has emerged among Senate tax writers concerns Section 899, which would impose steep retaliatory taxes—up to 50 percent—on foreign taxpayers from countries that discriminate against U.S. businesses through their own tax regimes. (Roundtable Weekly, May 30)
  • If enacted in its current form, in addition to taxing foreign companies, Section 899 could raise tax rates on passive foreign investment in the U.S. (CNBC, June 2; Kirkland and Ellis, June 5)
  • Congress’ Joint Committee on Taxation has asserted that the “retaliatory tax” could in effect lead to a decline in foreign demand for U.S. assets and lower U.S. tax revenue (Bloomberg, May 30) 
  • In the short term, however, the provision is projected to raise significant revenue—$120 billion over the first five years. (Politico, June 4) 
  • Senators are reviewing potential changes and modifications to section 899 to address concerns. “There’s a lot of nervousness about how it could be used,” Sen. James Lankford (R-OK) told reporters, indicating that Republicans “want to make sure there’s not some unintended consequences.” (Semafor, June 4)

Implications for CRE

  • Senate tax writers, thus far, have not signaled significant interest in changes to priority issues like the deductibility of property taxes (business SALT) or carried interest.
  • The Senate is considering potential Roundtable-backed improvements to the House-passed Opportunity Zone provisions, as well as reforms to the low-income housing tax credit, the new markets tax credit, and a longer extension for provisions related to bonus depreciation and business interest deductibility.
  • An RER working group is analyzing Section 899’s impact on real estate and working to ensure policymakers understand its potential unintended consequences, which could include deterring foreign investment in large-scale, capital-intensive real estate and infrastructure projects in the U.S. (Roundtable Weekly, May 30)

Looking Ahead

While a few Senate committees have already released their sections of the bill, the Senate Finance Committee is expected to share their draft of the tax portion next week. RER will continue to update its members on key changes and their impacts on the commercial real estate industry during what will surely be an eventful month in Washington as the Senate works toward passing their reconciliation package by July 4.

Senate to Debate Changes to Reconciliation Bill

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With Congress back in session next week, the Senate is gearing up to take on the House’s reconciliation package and potentially make significant changes to the bill. Meanwhile, the Trump administration is expected to release further information on its FY2026 budget.

Senate to Take Up One Big Beautiful Bill Act

  • “This bill is far from over, but we are pleased the House bill maintains current law on business property and income tax deductibility, carried interest, and Section 1031 exchanges, while also improving Opportunity Zones, the Low-Income Housing Tax Credit, and taxation of pass-through entities,” said Jeffrey DeBoer, President and CEO of The Real Estate Roundtable (RER). “As the Senate takes up this bill we plan to work to preserve these provisions.  We are also highly focused on eliminating the ‘retaliatory tax’ on foreign investment, as well as improving other aspects of the bill.”
  • The Senate is back in session Monday and eager to put its mark on the massive reconciliation package. The next four weeks will involve crucial tax negotiations on a variety of key provisions, including Inflation Reduction Act (IRA) energy tax incentives, state and local tax (SALT) deductions, Medicaid, and more. There are also procedural hurdles that the Senate bill must overcome.
  • Speaker Mike Johnson (R-LA) implored his Senate colleagues to avoid making major changes to the bill, saying, “If it wasn’t obvious for them, I wanted them to know the equilibrium that we reached is so delicate… My hope and my encouragement to them is – fine tune this product as little as possible.” (Punchbowl News, May 26)
  • Difficult compromises based on countless hours of negotiations were made to get the House bill across the finish line. If the Senate makes drastic changes, it could force negotiators back to the drawing board on certain issues and make it more difficult to meet the GOP’s goal of getting the reconciliation bill to President Trump’s desk by July 4. (Punchbowl News, May 29)

Expected Changes to the Reconciliation Bill

  • Early reports indicate that Senate leadership will seek only minor modifications to the House’s bill, rather than sweeping changes. But some senators are pushing for much more. (Punchbowl News, May 23)
  • Procedural changes: The Senate’s Byrd Rule requires that only budget-related items are included in the reconciliation process. As a result, some minor provisions could be stripped out. (Axios, May 28)
  • Tax additions: The Senate is also expected to switch the bill from a “current law” to a “current policy” baseline, allowing the Senate to permanently extend key tax cuts expiring this year. This would give Senate tax writers more space to include other tax provisions, including the Tax Cuts and Jobs Act’s (TCJA) 100 percent bonus depreciation.
  • Energy tax incentives: Multiple GOP senators have advocated for protecting the IRA energy tax incentives, including Sens. Lisa Murkowski (R-AK) and Thom Tillis (R-NC), who sits on the Senate Finance Committee and wants to moderate the House’s rollback of the tax credits. (Politico, May 23)
  • These modifications could include extending some tax credits that the House bill proposed eliminating, or expanding the timeline for their phase-out to ensure that the change does not strand energy projects already in progress.

Other Potential Changes

  • Medicaid cuts: Sens. Josh Hawley (R-MO), Susan Collins (R-ME), and others have taken issue with the House bill’s Medicaid cost-cutting measures, including expanded work requirements and other changes. (The Hill, May 28)
  • Deficit debate: A group of deficit hawks, including Sen. Ron Johnson (R-WI), are pushing for far deeper spending cuts than the House bill proposes, and have criticized it for not sufficiently reducing the deficit. Sen. Rand Paul (R-KY) also called the spending cuts in the House bill “wimpy and anemic.” (Axios, May 25)
  • Pressure from President Trump was crucial to getting deficit hawks in the House to back down from their opposition to the lower chamber’s bill. It remains to be seen whether conservatives concerned about the deficit in the Senate will put up more of a fight.
  • Debt limit: The Senate could increase the debt limit hike in the bill from $4 trillion to $5 trillion, ensuring that the next debt limit fight doesn’t happen until after the 2026 midterms. However, this proposal has also faced opposition from Sen. Rand Paul. (Politico, May 25)
  • Overall, Senate Majority Leader John Thune (R-SD) has his work cut out for him in order to hammer out the differences in opinion within his caucus. He can only afford to lose three GOP senators. It will take immense effort and deft political maneuvering to meet their aggressive July 4 goal.

Looking Ahead

  • Trump’s FY2026 budget request is expected to be released next week, kicking off a renewed budget battle after the administration’s skinny budget proposed in early May received pushback from both sides of the aisle. (Reuters, May 2)

RER will continue to engage with policymakers to ensure that the commercial real estate industry has a seat at the table in the critical Senate negotiations to come.

Industry Leaders Discuss Economic Outlook, Policy Priorities, and Geopolitical Challenges at Annual Meeting

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The Real Estate Roundtable’s (RER) 2025 Annual Meeting this week included discussions with public officials and industry leaders on a range of issues affecting commercial real estate, including market conditions, tax policy, the House’s recent passage of the One Big Beautiful Bill Act, tariffs and trade, affordable housing solutions, energy policy, and evolving security threats.

Roundtable Leadership

  • RER Chair Kathleen McCarthy (Global Co-Head of Blackstone Real Estate, Blackstone) opened the meeting by thanking members for their consistent engagement and highlighting the significance of RER’s collaborative efforts in navigating a rapidly evolving policy landscape. (May 2025 Policy Priorities and Executive Summary)
  • During the meeting, RER members approved the nominees for its FY26 board of directors and policy advisory committee officers, which were announced by RER Nominating Committee Chair Geordy Johnson (CEO, The Johnson Group).
  • Addressing the membership, RER President and CEO Jeffrey DeBoer emphasized RER’s ongoing commitment to enhancing member involvement through RER’s policy advisory committees and underscored the value of strategic partnerships with other national real estate organizations for proactive policy advocacy. (Meeting Agenda)

Meeting Speakers

  • The Honorable Kevin Hassett (Director, National Economic Council) presented the administration’s economic agenda, focusing on housing initiatives, factory expensing, and the outlook for growth.
  • (L-R): Hessam Nadji (President and CEO, Marcus & Millichap), Martha Gimble (Executive Director, The Budget Lab at Yale University), and Jonathan Pollack (President, Starwood Capital Group) provided macroeconomic insights, reviewed current and future CRE market trends, and spoke about challenges amidst tariff-induced uncertainty. (Hessam Nadji Presentation | Martha Gimble Presentation)
  • Anna Palmer (Founder & CEO of Punchbowl News) offered her perspective on legislative developments and negotiations, and the rise of influential figures within both political parties.

Policy Advisory Committee Meetings

  • Each of RER’s policy advisory committees met this week in conjunction with the Annual Meeting for in-depth policy discussions. The committees hosted several congressional staff and regulatory officials.

Sustainability Policy Advisory Committee (SPAC) Meeting

  • SPAC Chair Anthony E. Malkin (Chairman and CEO, Empire State Realty Trust, Inc.), Co-Vice Chairs Ben Myers (Vice President, Sustainability, BXP) and Katie Rothenberg (Vice President, ESG, AvalonBay Communities, Inc.) led discussions on EPA’s ENERGY STAR program, grid reliability, clean energy procurement, and nuclear energy deployment. (Agenda & Speakers)

Tax Policy Advisory Committee (TPAC)

  • TPAC Chair Josh Parker (Chairman & CEO, Ancora Group Capital), Vice Chair David Friedline (Partner, Deloitte Tax LLP), and the Committee discussed the broad range of tax proposals affecting real estate that are working their way through Congress in the budget reconciliation bill. Panelists included senior staff from the offices of the House Speaker, Ways and Means Committee, Senator Tim Scott (R-SC), and Senator Todd Young (R-IN), as well as the Treasury Department. In addition, tax experts from Baker McKenzie, Sullivan & Cromwell, and Brownstein led or moderated discussions concerning potential new taxes on foreign investors, regulatory initiatives, and Opportunity Zones.  (Agenda & Speakers)

Sustainability Policy Advisory Committee (SPAC)

  • SPAC Chair Anthony E. Malkin (Chairman and CEO, Empire State Realty Trust, Inc.) and Vice Chairs Ben Myers (Vice President, Sustainability, BXP) and Katie Rothenberg (VP, ESG, AvalonBay Communities, Inc.) led discussions on (Agenda & Speakers)

Joint Real Estate Capital Policy Advisory Committee (RECPAC) and Research Committee Meeting

  • D. Michael Van Konynenburg (President, Eastdil Secured) provided an overview of conditions in real estate credit and capital markets.
  • Following a national policy update from RER’S Ryan McCormick (SVP & Counsel, RER) and Chip Rodgers (SVP, RER), Research Committee Chair Spencer Levy (Global Chief Client Officer & Senior Economic Advisor, CBRE) and Darin Mellot (Vice President of Capital Markets Research, CBRE) led a discussion on the evolving post Liberation Day impact of tariffs on commercial real estate markets. 
  • Robert Rubano (Executive Vice Chairman, Head of Equity, Debt, & Structured Finance, Cushman & Wakefield) moderated a capital market roundtable with David Bouton (Co-Head of U.S. CMBS, Citigroup), Jack Gay (Senior Managing Director, Global Head of Real Estate Debt, Nuveen Real Estate), Kathryn Ogden, (Head U.S. Corporate Banking and Global Head, Real Estate Capital Partners (RECP), RBC Capital Markets), and Matt Salem (Partner, Head of RE Credit, KKR). (Agenda & Speakers)

Homeland Security Task Force (HSTF) Meeting

  • HSTF Chair Amanda S. Mason (Executive Director, Global Intelligence, Related Companies) facilitated a number of discussions on the current threat picture.  These discussions included a review of the risks to commercial facilities from lithium-ion batteries with John Frank (AXA XL Risk Consulting). The meeting also included a series of briefs from the FBI regarding the threats from terrorist and transnational criminal organizations that are directly threatening U.S. citizens and commercial facilities. These discussions included updates on the role of the cartels in violent crime, the deaths of American citizens from synthetic opioids, and the facilitation of nearly three million illegal migrant arrivals in 2024, putting U.S. communities at risk. Also addressed were the range of cyber and intelligence threats from China, targeting our critical infrastructure. (Agenda & Speakers)

RER’s 2025 Annual Report will be distributed in July. Next on RER’s FY 2025 meeting calendar is the Fall Meeting, which will take place on October 27-28 (restricted to Roundtable-level members only). 

“One Big Beautiful Bill” Moves Through to the Senate as House Republicans Unite on Trump Tax Plan

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House Speaker Mike Johnson (R-LA) met his self-imposed Memorial Day deadline as dissenting factions within the caucus reached an agreement on a series of last-minute changes, culminating in a razor-thin vote (215-214) on the One Big Beautiful Bill Act early Thursday morning. The budget reconciliation measure—which has wide implications for CRE—now goes to the Senate, where a similar tug of war could play out. (Ways & Means Press Release, May 22)

State of Play

  • The House Budget Committee voted late Sunday night to advance President Donald Trump’s One Big Beautiful Bill Act after several GOP hard-liners on the Committee blocked the measure from moving forward last Friday. (ABC News, May 19)
  • President Trump traveled to Capitol Hill Tuesday morning to deliver a message to House Republicans impeding the massive bill, a critical part of his domestic agenda: stop fighting and get it done as soon as possible. (NBC News, May 20)
  • The chamber took action, clearing the sprawling package in an early-morning vote Thursday after days of marathon meetings, intense negotiations that spanned both ends of Pennsylvania Avenue, and a series of swift changes to the bill, which were crucial in coalescing Republicans around the measure. (The Hill, May 22)
  • House Ways and Means Chair Jason Smith (R-MO) said that he’s been working “hand in glove” with Majority Leader John Thune (R-SD) and Senate Finance Committee Chair Mike Crapo (R-ID) on the tax package and had crafted it intentionally so it could survive the Senate’s rules. “I think 90 to 95 percent of the bill is going to be pretty much very similar,” he said previously. (Bloomberg, May 22)

Implications for CRE

  • The legislation includes an extension of the 2017 tax cuts, while maintaining the full deductibility of state and local business property tax deductions (also known as “Business SALT”) and preserving the current treatment of carried interest, two key priorities for The Roundtable in the current tax negotiations.
  • Additionally, the pass-through deduction under Section 199A would increase from 20 percent to 23 percent for qualifying income, including REIT dividends and the real estate operating income of partnerships and other pass-through entities. A late addition to the bill will allow REITs greater flexibility in their use of taxable REIT subsidiaries. (The Hill, May 21)
  • The bill extends the Opportunity Zone (OZ) tax incentives through 2033, with several updated eligibility criteria and new benefits for rural areas. This legislation also calls for a new round of OZ designations by state governors. (Mortgage Point, May 22)
  • Other positive developments include an expansion of the low-income housing tax credit and the reinstatement of 100 percent expensing for qualifying leasehold and nonresidential property improvements.
  • Now, the Senate will debate and craft its version of the bill, which it aims to pass by July 4. (The Hill, May 21; CNBC, May 22)

The Roundtable’s Position

  • RER expressed support for the House’s budget reconciliation measure. The extension of TCJA policies, preservation of property tax deductibility, continued capital gains treatment for carried interest, increased investment in affordable housing, and enhanced pass-through deduction are all positive developments. 
  • “Taken as a whole, the tax proposals in the Chairman’s amendment will spur needed investment in our nation’s housing supply, strengthen urban and rural communities, and grow the broader economy to the benefit of all Americans,” said RER President and CEO Jeff DeBoer in a recent statement following the House Ways and Means Committee’s bill markup last week.

What’s Next       

  • The action on the tax and fiscal legislation now shifts to the U.S Senate where Republicans are operating under similar tight margins.
  • Senate Republican leaders have not yet decided whether they will mark up the reconciliation bill in the various committees of jurisdiction. Finance Chairman Crapo could bring a substitute amendment straight to the Senate floor sometime in June.

RER will work to ensure that these hard-fought victories are protected in any final tax package.

House Ways and Means Advances GOP Tax Bill

Posted on by abigail_grenadier

The House Ways and Means Committee this week passed a comprehensive tax package that preserves critical features of current law while extending and improving real estate provisions supported by The Real Estate Roundtable. However, the legislation encountered a substantial setback Friday morning, when the House Budget Committee rejected the “One Big Beautiful Bill,” which combined the work of the Ways and Means and other House committees. (Axios, May 16)

“Taken as a whole, the tax proposals in the Chairman’s amendment will spur needed investment in our nation’s housing supply, strengthen urban and rural communities, and grow the broader economy to the benefit of all Americans,” said Roundtable President and CEO Jeffrey DeBoer.  (Read DeBoer’s full statement here)

State of Play

  • The House Budget Committee rejected the bill in a 16-21 vote after GOP leadership failed to secure sufficient support from several Republican holdouts. (Axios, May 16)
  • President Trump on Friday urged Republicans to fall in line and support the massive reconciliation package amid sparring among members on the Hill over various provisions. “Republicans MUST UNITE behind, ‘THE ONE, BIG BEAUTIFUL BILL!’” Trump posted on Truth Social.
  • House GOP leaders plan to continue private talks with the reluctant Republicans and the White House over the weekend in hopes of resurrecting the package next week. (Politico, May 16)

What’s In and Out for CRE

  • As currently drafted, the House legislation maintains the full deductibility of state and local business-related property taxes.
  • Carried interest, capital gains, like-kind exchanges, and general cost recovery periods for commercial real estate would remain unchanged.
  • Section 199A Deduction Boost: The legislation permanently increases the pass-through business income deduction from 20% to 23%, preserving eligibility for REIT dividends and effectively lowering the maximum tax rate on qualifying income to 28.49%.
  • 100% Bonus Depreciation: The Ways and Means Committee is proposing to reinstate 100% bonus depreciation for five years (2025–2030), incentivizing investments and upgrades in nonresidential properties.
  • Opportunity Zones: The legislation extends the Opportunity Zone tax incentives through 2033 and would set aside 33% of new OZ designations for rural areas.
  • Low-Income Housing Tax Credit: The legislation increases the allocation of low-income housing credits by 12.5% for four years and permanently reduces the threshold of private activity bond financing necessary for projects to otherwise qualify for credits.
  • Energy Tax Incentives: The Ways and Means legislation repeals or phases out tax incentives such as the section 48 tax credit for solar panel and other clean energy investments, the 45L tax credit for new home construction, and the section 30C tax credit for EV recharging stations.  (See more in Energy story below) 
  • Factory Expensing: Other tax changes would temporarily allow newly constructed manufacturing, agricultural and refining properties to qualify for 100% expensing.

Roundtable Advocacy

  • RER President and CEO Jeffrey DeBoer provided insights on these developments during a fireside chat at the ULI Spring Meeting in Denver this week. DeBoer discussed the current political climate, policy implications for commercial real estate, and outlined both emerging risks and opportunities shaping the industry’s future.

Housing News

  • The Ways and Means Committee’s provisions to expand the Low-Income Housing Tax Credit (LIHTC) align with components of the Affordable Housing Credit Improvement Act (AHCIA).  (Affordable Housing Finance, May 16) (RW, May 2)
  • The House Financial Services Subcommittee on Housing and Insurance held a hearing this week titled, “Expanding Choice and Increasing Supply: Housing Innovation in America,” focused on how modern construction technologies could increase moderate-income housing supply while identifying regulatory and financing barriers that limit broader adoption.
  • Lawmakers and witnesses explored alternative housing solutions such as manufactured housing, modular construction, and 3-D printed homes as ways to help close the housing supply gap.  (Watch Hearing, May 14)

Looking Ahead

  • House Ways and Means Chair Jason Smith (R-MO) expressed interest in passing a separate bipartisan tax package by the end of the year, at an appearance at the Economic Club of Washington, D.C. earlier this week. This package would include expiring tax provisions and healthcare-related items.
  • “I would love to work with Sen. Wyden, Chairman Crapo, ranking member Neal in trying to craft a bipartisan bill before the end of the year, because there’s a lot of tax provisions that I really care about that are expiring, or have expired, that are truly, truly bipartisan,” said Smith. (PoliticoPro, May 15)
  • Senate Finance Committee Chair Mike Crapo (R-ID) and fellow panel member Sen. Steve Daines (R-MT) are pushing to extend business tax cuts beyond the expiration set by Ways and Means, the latest change the Senate wants to make to the bill. (Reuters, May 16)

With the Budget Committee setback, the immediate future of the tax package is uncertain. But the provisions are certain to change further as the debate shifts to the Senate.