Question: Why set up a kingdom on earth when Christ reigns now? He said, ‘my kingdom is not of this earth.’
Answer:

The prophet Jeremiah expressly states that the “future kingdom” of Messiah would be an earthly one:
‘Behold, the days are coming,’ says the Lord, ‘that I will raise to David a Branch of righteousness; a King shall reign and prosper, and execute judgment and righteousness in the earth” (emphasis added)
The Lord Jesus Himself repeatedly said he would physically return to earth to establish the Old Testament promise of an “earthly kingdom.” Remember that the disciples believed Jesus would set up His Kingdom at any moment. In the gospels, Jesus gave several parables to clarify that His “physical kingdom” was yet future (i.e., Luke 17:20-21, 19:12-27; Matt 24:45-51, 25:1-13, 14-30). He did this, “because the disciples thought the kingdom of God would appear immediately” (Luke 19:11).
So while Jesus reigns in heaven and perfectly rules His Church, God’s Word and Jesus Himself promised to return a second time and fulfill the remaining 233 prophecies establishing Messiah’s earthly kingdom (see Rev 20).
When our Lord taught His disciples “how to pray” in Matt 6, He said:
Our Father who art in heaven hallowed be Thy name, Thy Kingdom come, Thy will be done on earth as it is in heaven…
In providing this “model” prayer, He was establishing in the hearts and minds of His disciples then and throughout the church age two key principles. First, He not only affirmed the reality of the “spiritual kingdom” that God’s people are placed into at their conversion, but the reality of the “future earthly kingdom” that He promised throughout His Word!
Why set up an earthly Kingdom? Because Jesus keeps His promises to His people. That is certain!
“Heaven and earth will pass away but My words will never pass away” (Matt 24:35)