Global trade tensions and protectionist policies are reshaping supply chains, manufacturing and logistics. At I.CON West this week, James Bohnaker, principal economist, Cushman & Wakefield, and Vince Tibone, managing director, Green Street Advisors, broke down what these dynamics mean for industrial development, demand and site selection.
Although 2025 was relatively steady for the U.S. economy – 2.2% GDP growth, resilient consumer spending and slight growth in U.S. imports – the bigger story, Bohnaker said, is how quickly the rules of global trade have changed. For decades, trade arrangements were relatively stable; bilateral and multilateral deals were negotiated over years and then stayed in place for years. “What we’ve learned over the past 18 months is that those things can change really quickly,” he said. Industrial users must plan for flexibility and contingency rather than long-term predictability.
“We haven’t necessarily seen a lift, at least in terms of employment,” Bohnaker said, from these shifts in trade policy with the objective to boost manufacturing and trade throughout the U.S. In sectors most tied to industrial demand – transportation, warehousing, manufacturing, wholesale and retail trade – jobs fell by 250,000 in 2025.
Shifting Trade Flows
In 2025, U.S. imports from China declined by about 30%, replaced largely by goods from Mexico, Vietnam and Taiwan.
“Houston and Savannah port volumes have done very well, and I think that makes sense given the positive population growth and demographic trends broadly,” said Tibone. Southern California and Seattle – markets laregely reliant on trade with China – have struggled more.
The recent Supreme Court decision on the legality of President Donald Trump’s tariffs “is probably more encouraging than not for West Coast and [markets] in trade with China broadly,” he said, though there is still a lot of uncertainty on which tariffs may “stick.”
Bohnaker also reminded the group that U.S.-Mexico-Canada Agreement (USMCA) is up for review in July; trade policy is still very much in flux.
E-commerce, Retail and Inventory Trends
Industrial demand is no longer purely an e-commerce story, Bohnaker pointed out. With omnichannel as the standard, goods consumption overall is the real driver.
“Retail sales exceeded our expectations at Green Street at the beginning of the year,” said Tibone, adding that gap between e-commerce and brick-and-mortar growth has narrowed significantly, with online sales outpacing retail sales by just one percentage point.
Looking at retail inventories, the COVID-19-era stockpiling has waned. Tibone’s view is that the just-in-case model will ultimately prevail, especially as artificial intelligence and emerging technologies improve companies’ ability to forecast sales, place inventory and increase throughput.
Downside Risks and Looking Ahead
Bohnaker and Tibone agreed that 2026 and 2027 will be good years for the sector, “with the big caveat that the downside risks worry me,” Bohnaker said. “There’s no shortage of them.” He named softening consumer spending data over January and February (though major weather events in big population centers could have been a factor), the less-than-stellar job market, and the significant geopolitical upheavals of the last few weeks.
But overall, “The next two years are set for a pretty favorable backdrop for a recovery here,” Tibone said.
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