What is the best approach for multi categories filtering
You could leave the Category URI Format blank in your settings and set an advanced route in config/routes.php like so:

'projects/&lt;type:{slug}&gt;/&lt;state:{slug}&gt;/&lt;location:{slug}&gt;' =&gt; ['template' =&gt; 'projects/index'],


Which would make {{ type }}, {{ state }} and {{ location }} available as variables in your template.