How infrastructure and cost are influencing Raleigh-Durham development

Key points:

• • Growth remains strong, but power and infrastructure constraints are limiting development.
• • Large-scale projects are rising, increasing complexity and labor pressure.
• • Reshoring and investor demand support long-term momentum.

April 2026 — The Triangle remains among the fastest-growing areas in the country, with new data from the U.S. Census Bureau ranking Raleigh-Cary as the 10th fastest-growing metro area and Wake County as the fifth for population growth last year. Growth is entering a complex phase, where site selection and risk management increasingly determine which projects move forward and how.

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The region continues to attract investment across life sciences, advanced manufacturing, and emerging sectors, supported by a deep talent base and research ecosystem tied to institutions like NC State, Duke, and UNC. In 2025, companies announced expansions, relocations, and new facilities totaling nearly $3.8 billion, with more than 1,300 jobs tied to those investments.

Industrial activity has remained steady, with more than 2.6 million square feet of net absorption recorded in 2025 and strong leasing activity across core and emerging areas, according to Colliers. Entering 2026, roughly 6.7 million square feet of industrial and flex space is under construction, one of the most active development pipelines of the past decade.

As development expands and competition for viable sites increases, infrastructure capacity is becoming a defining factor in where projects move forward. Site selection is increasingly tied to the availability of power, water, and sewer systems.

Electricity demand across North Carolina could rise by as much as 60% by 2040, placing added pressure on already constrained networks and pushing developers and end users toward outer markets such as Johnston County and Greenville, where larger sites are available but often require additional investment to become viable. 

Additionally, labor constraints are adding another layer of complexity. According to a proprietary model developed by Associated Builders and Contractors, the construction industry needs to attract roughly 349,000 additional workers in 2026 to meet the demand for construction services. 

Invest: Raleigh Durham spoke with real estate and development leaders across the region to understand how infrastructure constraints, shifting investment, and execution challenges are influencing where and how projects move forward.

Jim Anthony, CEO, APG Companies: This has been a year of structural change rather than normal cyclical variation. One of the most important drivers has been trade policy. Tariffs and geopolitical pressures have triggered a wave of reshoring that is unprecedented in scope. For markets with land, infrastructure, and workforce capacity, that shift is creating long-term tailwinds and a new foundation for investment.

At the same time, tighter border controls and enforcement have produced labor-market ripple effects. Many construction and manufacturing operations have seen workers hesitate to show up on job sites, which has slowed timelines for projects that otherwise have demand and financing. The country clearly needs a dependable worker-permit system that balances security with economic necessity. Until that comes together, labor constraints will continue to impact project feasibility and timelines.

Matt Hohorst, Vice President, ARCO Design: 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.

Andrew Moriarty, Principal, Bohler: The most pressing constraint today is power. Power availability has become a significant limiting factor for development. In the past, utility providers were often willing to move quickly to support large, power-intensive projects. Today, supply is tighter, and providers are more cautious, often requiring greater certainty that projects will move forward before committing capacity.

Developers are increasingly expected to fund studies and contribute more directly to the infrastructure needed to deliver power to their sites. While data centers are a major driver of this demand, placing pressure on both power and water systems, the issue extends well beyond that sector. Manufacturing, logistics, and automated warehouse facilities now require substantially more electrical capacity than similar buildings did just a few years ago.

Power is likely to remain the most significant infrastructure challenge nationally and globally for the next decade. These constraints are compounded by supply chain delays, particularly for transformers and other electrical equipment, which can disrupt schedules and force teams to plan construction around equipment availability.

Shawn Pepple, Raleigh Business Unit Leader, DPR Construction: One of the biggest drivers for us continues to be the strength of the life sciences sector. Life science manufacturing has grown tremendously in this market, and Raleigh-Durham offers the right combination of industry support, access to land, strong higher education institutions, and targeted incentives that bring major projects here.
The scale has increased dramatically. Not long ago, a $250 million project was considered large for this area. Today, many projects are pushing $1 billion or more. Our largest project currently in preconstruction is roughly $1.5 billion, and there are healthcare opportunities in the pipeline exceeding $2 billion.

As projects get larger, delivery becomes more complex. The level of integration required between owners, design teams, and builders has grown, and we are seeing more emphasis on early alignment. These jobs require a coordinated effort from day one to be successful.

Another dynamic is the strain on the trade partner community. Many large megaprojects across the region are pulling from the same pool of subcontractors, and those teams are stretched. To deliver billion-dollar projects, we often have to look beyond local partners and bring in national players. We also need to engage much earlier than before and make commitments sooner, so trade partners have the confidence and runway to ramp up the resources needed.

Ryan Toland, Executive Vice President & Principal, Colliers: On the industrial side, the market remains strong. There’s been a bit of a slowdown, but I don’t see that as a red flag. Vacancy rates are still low, rents are rising, and institutional developers are looking to acquire or build.

We’re working on developments in Johnston County, Clayton, Garner, and along the I-85 corridor toward Greensboro. One project in North Durham, focused on life science and industrial, is already fully leased even though the buildings haven’t been completed.

Previously, the market was extremely competitive. Multiple companies were pursuing the same space. As a result, owners raised rents because supply couldn’t keep up with demand. While that intensity has cooled slightly, the market is still active. Institutional investors are still spending heavily on well-located sites.

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