The Trump Administration is proposing further budget cuts to the National Oceanic and Atmospheric Administration (NOAA) for fiscal year 2026, which begins October 1. The agency, a branch of the U.S. Commerce Department, lost about 30 percent of its funding in 2025, and it is set to spend 14 percent less for climate research than Congress mandated.
“Given the annual deficit of more than $1.5 trillion and the national debt of $37 trillion, we need to figure out what the federal government has to do and what the private sector can do,” says Diana Furchtgott-Roth, director of the Center for Energy, Climate, and Environment at The Heritage Foundation, a conservative think tank whose Project 2025 serves as a blueprint for downsizing the federal government, including NOAA.
Real estate professionals often rely on NOAA data to make informed investment decisions, and the possible impact of the budget cuts could be significant for the industry.
According to Alec Bogdanoff—principal scientist and co-founder of civil and coastal engineering firm Brizaga, which specializes in resilience and flood mitigation—NOAA’s data supports more than $10 trillion in goods and services, including commercial real estate, with weather forecasting, ocean monitoring, climate analysis, geospatial positioning, and natural disaster warnings.
“NOAA is deeply embedded in the economy and development sector in ways that are not always visible to the public,” Bogdanoff explains. “Whether they’re deciding to acquire property or make an investment, reviewing potential hazards, or [assessing] existing or future mitigation efforts, evidence-based decisions depend on data and research from NOAA.”
As part of their due diligence process, many investment management firms use third-party climate risk analytic software tools that are built on NOAA data. LaSalle Investment Management, for example, turns to First Street for independent assessments that inform its portfolio decisions.
“We have downloaded NOAA’s historical air temperature, precipitation, hail, hurricane, coastal sea level, and other environmental data to create our high-resolution flood, wildfire, and wind risk insights for homeowners, businesses, and communities across the country,” says Ed Kearns, chief science officer at First Street and former chief data officer with NOAA. “NOAA’s open data enable private sector innovators such as First Street, but we’re not dependent on new data from the agency when it comes to specific properties.”
Elena Alschuler, head of sustainability for the Americas at LaSalle, notes that private analysts still rely on NOAA’s data to identify long-term climate hazards for any given project site. “If a location is flagged as having an elevated physical climate risk,” Alschuler says, “then we will dig in and review additional data sources to look at how the property was built, or other resiliency measures at the property or in the local community, to make a final determination as to whether we’re comfortable with that level of risk.”
Critical value to development
According to the National Centers for Environmental Information (NCEI), a NOAA entity charged with maintaining the nation’s environmental data, NOAA’s historical work directly informs the real estate industry and the built environment.
“NOAA data is integral to American infrastructure and provides essential data to ensure that buildings, bridges, and other structures are designed to withstand current and future environmental conditions,” NCEI says in a statement. “Our data inform everything from initial siting, engineering, and construction to the pricing of building materials, insurance rates, and property taxes. NOAA data and other products are critical to making key decisions about our country’s infrastructure.”
National Geodetic Survey, for example, maintains the National Spatial Reference System, including NAVD88, which is the official elevation baseline across America. This benchmark underpins surveying, engineering, zoning, floodplain mapping, and even insurance rates. Developers planning waterfront or low-lying communities, for instance, may depend on these sea level rise projections and inundation models to design for resilience. When cities plan major infrastructure, such as dams or stormwater systems, they trust this common language of elevation to ensure that one project aligns with the next from community to community. Currently, the NAVD88 system is being updated with more precise satellite-based models.
“As technology gets better, so does our ability to map the earth,” Bogdanoff says. “From determining the minimum elevation for a new hospital to assessing future flood risk for an entire city, NOAA’s data is foundational to the decisions that shape our urban environment.”
This input is especially important for coastline developments, which typically sell at a premium—an average of 78 percent for properties with a waterfront view. In Florida, that premium reaches 119 percent, whereas in California it stands at 101 percent, according to home warranty company American Home Shield.
“There’s nothing quite like building . . . where the ocean and land meet,” says Jean Francois Roy, CEO of OceanLand, a development company focused on waterfront properties in Florida. “It’s a unique privilege and one that comes with serious responsibilities. Coastal development requires a thoughtful understanding of environmental risks and a commitment to long-term resilience.”
“One of the biggest impacts of NOAA budget cuts could hit developers and communities if the Atlas 15 precipitation estimate is eliminated,” Kearns warns. “We’ve already seen increased rainfall, and fluvial flooding is worse than it was in the past. Everyone needs to be prepared and make investments in risk mitigation for their community and property based on accurate forecasts.”
Impact on insurance rates
Alschuler of LaSalle points out that insurance companies are also major consumers of the historical data on natural disasters that have been compiled by NOAA. “Climate risk providers are doing forward-looking risk analysis, whereas the insurance providers are . . . usually looking more at the history of events, such as catastrophe maps and the history and cost of previous events,” Alschuler says. “Insurance companies use this data for underwriting and rate setting, establishing guidelines for their claim aggregations, and reinsurance purchasers also use it to plan for the potential impact of disasters.”
“Without that foundation, insurance markets would face far greater uncertainty and costs,” agrees Bogdanoff. “And because insurance is an increasing and variable cost of development, a stable, data-informed insurance sector creates the certainty investors and developers need to make long-term commitments.”
