The past five years have seen a substantial uptick in reshoring activity as companies try to build more resilient supply chains that can resist unexpected disruptions ranging from global pandemics to trade wars and geopolitical instability. As supply chain leaders look ahead to the rest of 2025, it’s easy to wonder how the current presidential administration’s policies will impact the reshoring trend. In this article, we’ll discuss how current trade and economic policies could impact the ongoing onshoring efforts by U.S. businesses.

3 Reasons Why Reshoring Ramped Up

Reshoring/onshoring isn’t a new phenomenon for U.S. business leaders. Trade magazines and news outlets have speculated on and off about a manufacturing renaissance since the turn of the century, as the establishment of China’s middle class and rising wages in the popular outsourcing destination made it less appealing. But the reality remained that manufacturing in other countries was still more affordable, while reshoring back to the U.S. was both expensive and time-consuming.

Spurring notable action on reshoring required a perfect storm of disruptive supply chain elements. Here are the main factors that pushed reshoring from consideration to reality:

1. During the first Trump administration, a trade war with China accompanied by a general rise in overseas production costs suddenly made decades-long offshoring strategies less appealing for U.S. businesses.
2. Following that, the COVID-19 pandemic showed companies what can happen when an unexpected event cuts them off from their far-flung suppliers. That’s when we began to see the popularization of the term “supply chain resiliency,” as businesses realized that shortening supply chains could help to ensure business continuity.
3. Finally, the Biden administration massively incentivized reshoring for renewable energy, green tech, and various other industries through the Inflation Reduction Act (IRA), CHIPS and Science Act, and Infrastructure Investment and Jobs Act.

These factors combined have made reshoring efforts into a key demand driver for industrial real estate over the past few years.

What Happens Next for Reshoring

One of the early executive orders from the Trump Administration put a hold on disbursements for IRA and Infrastructure Investment and Jobs Act funding, which may negatively affect a variety of key reshoring drivers over the long-term—especially green manufacturing like solar panels and batteries. This immediate action to rescind incentives for certain industries to reshore raised a lot of concerns and red flags in the industrial real estate market, which has benefited from these policies to date.

However, it’s important to consider reshoring in the context of the administration’s other goals. Efforts to impose tariffs on goods coming from places like China to closer trading partners like Europe, Canada, and Mexico will drive up the cost of importing goods for U.S. companies. The administration hopes this will spur continued interest in reshoring across industries by making the import of goods and components too costly for U.S. importers and forcing them to source and produce domestically.

When considering how the ongoing shifts in economic and trade policies will impact reshoring efforts, Frank Crivello of Phoenix Investors offered these insights:

• As these policies begin to impact supply chains, reshoring should remain a demand driver for commercial real estate as more companies minimize their interactions with foreign suppliers and seek domestic sources.
• Furthermore, reshoring is costly and takes a long time. Unless they are very early on in their reshoring journey, it’s unlikely that businesses that have already committed to reshoring would pause or abandon those efforts in reaction to short-term policies and risk losing the investments they’ve already made. Those efforts should come to fruition and benefit industrial real estate in the next couple of years, regardless of policy changes.
• With that said, however, it isn’t realistic to assume that all industries will move production to the United States just because tariffs drive up their costs. For instance, some raw materials simply can’t be sourced in the required quantities from within the United States, such as heavy rare Earth minerals. As another example, the automotive sector makes most of its parts in Mexico, and is more likely to pass costs to consumers than uproot that foundation over tariffs.
• Still, supply chain resiliency as a concept remains a key goal for U.S. supply chain leaders as they seek to control costs and mitigate disruptive elements, and reshoring is a core strategy for pursuing resilience. To this end, we’ll now see reshoring start to happen more broadly across other industries as companies that rely on imports begin to strategize around tariffs. This is in stark contrast to the previous administration, where much of the reshoring activity focused on green manufacturing and microchips.

If your business is considering reshoring production or logistics assets but isn’t sure how recent policies will impact your decision, talking it over with an experienced industrial real estate broker can help. Feel free to reach out to us to talk through any concerns you may have about ongoing reshoring efforts or upcoming plans.

About Phoenix Investors

Founded by Frank P. Crivello in 1994, Phoenix Investors and its affiliates (collectively “Phoenix”) are a leader in the acquisition, development, renovation, and repositioning of industrial facilities throughout the United States. Utilizing a disciplined investment approach and successful partnerships with institutional capital sources, corporations and public stakeholders, Phoenix has developed a proven track record of generating superior risk adjusted returns, while providing cost-efficient lease rates for its growing portfolio of national tenants. Its efforts inspire and drive the transformation and reinvigoration of the economic engines in the communities it serves. Phoenix continues to be defined by thoughtful relationships, sophisticated investment tools, cost-efficient solutions, and a reputation for success.