ALASKA – YOU’ll LOVE THE INDUSTRIAL R.E. MARKET HERE

ALASKA INDUSTRIAL PROPERTIES

Alaska Commercial Report: The 2025 Frontier, by Marie Cappello, Broker – Argossy International

The Last Frontier is no longer just oil and wilderness. It’s an investment landscape defined by
scarcity, specialization, and federal money. The market is not for the faint of heart, but the rewards
for a strategic investor are immense.

• Population: A static state. Total population hovers at 743,756. Anchorage, the commercial hub,
  sees a slight decline, but the Matanuska-Susitna Borough is a bright spot.
• Energy & Economy: The engine is shifting. While oil remains vital, with production forecast
  to grow for the first time in years, diversification is key. Federal spending on infrastructure
  is a tidal wave.
• Anchorage: A Market of Constraints:
  • Industrial: A seller’s paradise. Vacancy rates below 3%. Land is scarce. New development
    is stalled. Rents are rising. Out-of-state 1031 exchange buyers are driving the market.
  • Office: An enduring struggle. Vacancy rates remain high. The shift to remote work is real.
  • Retail: Stable, not spectacular. Steady demand for grocery-anchored centers and
    fast-casual restaurants. Limited new construction means low vacancies.
  • Multifamily: Resilient. Workforce housing and affordable housing are high-demand.
    Housing prices are up, but a lack of new construction is a major drag.
• Juneau & Beyond:
  • Juneau sees no significant changes in its office, retail, or multifamily property assessments.
  • Warehouse properties are an exception, seeing an 18% average increase.
  • The Mat-Su Valley is the state’s growth hotspot. Retail strip centers, light industrial
    warehouses, and land for development along the Parks Highway are the hot tickets.
• Key Investment Opportunities:
  • Industrial outdoor storage.
  • Cold storage facilities.
  • Adaptive reuse projects, especially for older office buildings.
  • Workforce housing development.

Key Takeaways:

• Scarcity is the driving force: Limited land, low vacancies.
• Industrial is King: Anchorage’s industrial market is booming.
• Federal funds are a catalyst: New infrastructure projects are creating a jobs
  and construction boom.
• Demographics matter: Invest where the population is growing.