The escalating trade war between Canada and the U.S. is prompting Canadian investors to hit pause on deals in American commercial real estate, Business Insider reported.

The shift could disrupt the flow of tens of billions of dollars into the U.S. property market.

Business Insider reported that tensions between the two countries—spurred by President Donald Trump’s tariff policies and controversial rhetoric—are fuelling hesitation among Canadian firms that have historically been the largest foreign investors in U.S. commercial properties.

“I don’t think that Canadian investors are running to close deals in the U.S. today,” said Mark E. Rose, the CEO of Toronto-based Avison Young, in an interview with Business Insider.

The chill in investment is seen as part of a wider disruption to global commerce and capital flow, sparked by Trump’s tariffs, unpredictability when it comes to imposing them and relenting. Canada was not included in Trump’s recently announced 90-day pause on reciprocal tariffs. In addition to imposing the levies, the U.S. president made inflammatory comments about Canada, including musings about annexation that have alarmed and angered. The rhetoric has prompted a rapidly spreading Buy Canadian movement.

Time will tell how long and how extensively Canadian commercial real estate investors will adhere to that that mantra will adhere to that movement.

“There is certainly a pause going on,” Gunnar Branson, CEO of the Association of Foreign Investors in Real Estate (AFIRE), told Business Insider, noting that the slowdown affects both Canadian and broader foreign investment in the U.S.

As uncertainty mounts in North America, some investors are turning their focus overseas. David Steinbach, global chief investment officer at the real estate investment firm Hines, told Business Insider that interest in European assets is rising. He said Hines has recently had “more conversations about our European funds and investments” and is looking to raise additional capital for an open-ended fund on the continent.

Chicago-based Hines has a large presence in Canada and is a long-time major investor in cross-border investments, often partnering with Canadian firms.

According to Aaron Bennett, chief investment officer at the University Pension Plan of Ontario, it is also looking towards international markets.

“The opportunity for diversification in other markets like Europe and others, which was interesting before, becomes more interesting,” he told Business Insider.

Earlier forecasts had predicted an 8% rise in foreign investment in U.S. commercial property in 2025, according to CBRE. However, the real estate firm cautioned that potential tariffs and geopolitical uncertainties presented “downside risks” to that outlook, Business Insider noted.

Pictured: 450 Park Avenue in New York City, owned by Toronto-based Oxford Properties.

Photo: CBRE

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