You probably already know how closely real estate markets track Fed policy. So when President Trump’s advisors began pressing him to install a temporary Federal Reserve governor to fill the vacancy left by Adriana Kugler, I sat up straight. That four-month window may sound trivial on paper—but for developers and investors locking in financing today, it’s a critical period.

A Four-Month Appointment with Lasting Impact

Economist Derek Tang put it well: it may seem like a lot of trouble for a single, short-term seat, but “these four months are critical if you want the Fed to deliver on rate cuts that have been discussed.” At the same time, bending the central bank to the White House agenda risks unanchoring long-term Treasury yields. Higher long-term yields translate directly into:

• Sharper mortgage cost increases

• Higher cap rates on acquisitions

• More expensive bridge and construction loans

If uncertainty around Fed independence pushes ten-year Treasury yields even modestly higher, every development pro will feel it in our underwriting models.

Labor Market Turnaround as a Construction “Tax”

Fed Governor Lisa Cook called July’s revised job numbers “concerning” and noted that rising unemployment often signals an economic inflection point. From where I sit on site, I see this playing out as a kind of tax on every project:

• Skilled trade shortages become more acute as firms retrench

• Supply-chain hesitancy drags on material deliveries

• Project managers spend more time managing uncertainty than building

When businesses dedicate effort to just staying afloat, that’s “deadweight loss” Cook warned about—loss our industry can ill afford.

Treasury Auctions and Funding Costs

Last week’s weak demand for ten- and thirty-year Treasuries bumped the benchmark ten-year yield up to 4.23 percent. Yet traders still expect rate cuts as early as September—driving the ten-year yield down about 26 basis points since mid-July.

For us that means:

1. Floating-rate loans may get cheaper sooner if the Fed delivers cuts

2. Fixed-rate financing still carries a premium until yields stabilize

3. Refinancing decisions hinge on timing – lock now or wait for promised cuts?

Big Tech’s Bet on U.S. Manufacturing—and Industrial Real Estate

Meanwhile, Apple announced another $100 billion investment in domestic manufacturing under its American Manufacturing Program (AMP). That includes glass production in Kentucky, chip fabrication partnerships, and more. What does this mean for real estate?

• Industrial vacancy rates could tighten as manufacturers repatriate

• Rents on distribution centers and flex space may climb in key markets

• Opportunities to develop spec buildings tailored to semiconductor and advanced-materials tenants

My Take and Action Steps

1. Stress-test your pipelines under both rising-yield and falling-yield scenarios

2. Prioritize locking financing on projects where timing risk is greatest

3. Scout industrial land near AMP partner hubs—you may have a first-mover advantage

4. Build optionality into your debt structure with rate-cap hedges or hybrid loans

Uncertainty around a temporary Fed pick is unsettling. But to me, that’s always where opportunity hides. As we navigate these next few months, I’ll be leaning into my underwriting models, keeping a close eye on Treasury auctions, and lining up industrial playbooks for clients looking to capitalize on reshoring trends.

If you found this useful, hit subscribe for more deep dives on how macro policy affects our deals. If you have questions or want to share what you’re seeing on the ground, drop a comment below—I read every response.

—Daniel Kaufman

Founder, Kaufman Development