Matt Hohorst, Vice President, ARCO Design

Matt Hohorst, vice president of ARCO Design, sat down with Invest: to discuss the firm’s integrated design-build approach, the evolving industrial and life sciences landscape in Raleigh-Durham, and how early engagement, flexibility, and regional collaboration are key to navigating development challenges and accelerating project success.

How does ARCO’s approach in Raleigh-Durham distinguish itself from more traditional design-bid-build methods in terms of value and risk for clients?

We’ve focused on design-build since founding the company 33 years ago. From the start, our goal was to become the best design-builder in America, and today, we’re proud to be the largest design-builder of buildings in the country. Design-build has grown rapidly over the past three decades and now accounts for roughly 40% of all projects nationwide. It’s a smart approach for companies looking to maximize their capital investments.

While EPC and EPCM delivery models still have their place, we’ve found that clients are increasingly drawn not just to design-build, but to the way ARCO does design-build. Our approach is different: we truly integrate engineering and construction. It’s the heartbeat of our organization. We invest significant time identifying and attracting people who can deliver that integration in a meaningful way. In fact, we hire only about 1% of those who apply, and there’s a reason for that. Design-build is hard to do right. When done well, it allows us to deliver projects faster and more cost-effectively. That’s especially valuable for companies with speed-to-market demands or tight cost-of-goods targets.

In the Raleigh-Durham region, what are the most in-demand facility types or sectors that ARCO is seeing?

The life sciences industry has long been strong here, but over the past five to eight years, it has taken on a more prominent role nationwide. North Carolina offers several advantages: a deep labor pool, robust R&D and scientific talent from top universities, and lower population density, which makes it easier to site manufacturing facilities. Where companies once focused on major hubs like Boston, San Diego, or Chicago, they’re now viewing this region as a growth area for manufacturing. 

We’re seeing a trend toward investment in the outer edges of the market, not in the core cluster of Research Triangle Park, Raleigh, or Morrisville, but in areas like Greenville and Johnston County. That expansion opens new possibilities for placing larger manufacturing facilities and broadens the market’s potential.

Over the past 12 to 36 months, capital markets and private equity have shifted. Many facilities once focused on therapeutic areas in life sciences have seen investment dry up. In their place, we’re seeing major players like Genentech and Johnson & Johnson push into those outer rings. New sectors are also emerging, including mission critical, aerospace and defense, electronics, microelectronics, and food and beverage. We expect all of these to grow significantly over the next decade.

What are the key real estate and site-development considerations for clients looking to locate or expand in the region?

We’re fortunate that municipalities in this region are generally welcoming and eager to work with companies looking to invest. In other parts of the country, the attitude is often, “What can you do for me?” Here, it’s more, “what can we do to help you land here?” That mindset, call it Southern hospitality or a proactive business climate, makes a big difference.

We expect continued focus on this market, but the challenges are familiar; utility availability, especially power, water, and sewer, remains a bottleneck. These factors are driving project timelines and influencing where companies choose to locate. Sometimes, that means settling in areas that feel a bit off the beaten path. Across the region, many of the larger land sites have already been claimed for various uses. While we focus on industrial, life sciences, and advanced manufacturing, there has been a significant uptick in residential development, particularly single- and multifamily housing, which has absorbed prime land in key areas.

What’s left often comes with complications: challenging topography, wetlands, and soft soils or rock, especially as you move west. Finding the right balance is key. These are the primary drivers, risks, and challenges we see companies navigating today.

How do you integrate early-stage planning, financial structuring, and design/construction phases to help accelerate a client’s “time to occupancy” in your projects?

Traditionally, companies have focused on managing risk early in the development, design, and construction phases of a project. But today, with so many new and emerging players entering diverse sectors, the challenges have multiplied. Companies now face complex questions: How do you capitalize the deal?

How do you get equipment into the country? How do you raise money in sectors where political headwinds are constantly shifting? We’re finding it’s more important than ever for companies to have a strong grasp of key factors, such as labor availability, tax structures, incentives, grants, training programs, and equipment sourcing. These elements are critical to success, especially for manufacturers entering the market. Each piece must come together like a symphony. When aligned, they help companies navigate risk and position themselves for long-term success.

What are the major regulatory, zoning, or permitting challenges in the Raleigh-Durham region regarding the work you do?

We haven’t seen significant pushback on large-scale rezoning. The most resistance tends to come in the mission-critical sector. These facilities are challenging. They don’t generate many jobs, yet they require substantial infrastructure and consume a lot of power. Some communities prefer advanced manufacturing projects that create 300 to 500 jobs over data centers that may only employ 30 to 50.

When it comes to zoning, we’re mindful of those dynamics. But we don’t face the same challenges seen in denser clusters farther north on the East Coast, where public opposition and “not in my backyard” sentiment are more common. You don’t see people picketing outside facilities here. That’s part of what makes this region’s pro-business climate so strong, and why it has remained robust over the past five to 10 years.

What advice would you give to facility owners, developers, or corporate real-estate leaders considering a new project in the Triangle region?

It’s never too early to engage a design-build partner. We often hear from clients who want to carry the early stages of a project on their own, but by the time they bring us in, the foundation is unstable, and that’s tough to fix. If I could offer one piece of advice, it would be to do your homework early. With our networks and resources, we can guide clients through the land development process in ways that help them reach goals they didn’t think were possible before partnering with us. Engage early, and engage often. It makes all the difference.