Commercial Real Estate Market Stays Steady in Southeast.

• Author: PARMELEE, CATHERINE

When it comes to describing the state of the commercial real estate market in Southeast Alaska, where most of the communities are accessible only by air or by sea, the word most tossed out by local experts is "stable." For the most part, communities in Alaska's Panhandle have experienced little change in this arena for the past five years. And at this time, resident real estate professionals forecast little change for the near future.

In Juneau, the region's hub, commercial property vacancy rates are about the lowest they have been since the late 1980s, according to John Williams, an associate broker with Re/Max of Juneau. "Commercial property vacancy rates are better than they have been," he said, "but it's been a slow progression."

Overall, there is about 1.7 million square feet of commercial space to be had in Alaska's capital city, and around 1.35 million of that can be found downtown. As of February, the citywide vacancy rate for commercial property was 4 percent One-third of that was located in the Mendenhall Valley, a highly residential populated area of Juneau that's about 10 miles from the downtown district.

In a place like Juneau, if you were to rely on a strict Class A, B or C commercial space distinction, you would find very few Class A sites that look like some of the sleek glass and steel high-rises located in Anchorage. In general, most Class A space in Alaska's capital. city is occupied by state and federal government, along with other organizations that might need to meet access re governments for the disabled. Downtown, premium Class A space is very tight, whereas it is slightly more available in the Mendenhall Valley.

Class A space in downtown Juneau can run a bit more than $2 per square foot, whereas premium office space in the Mendenhall Valley can be leased for around $1.65 per square foot However, space in Vintage Business Park, located in the Mendenhall Valley, is apt to cost somewhat more.

According to Williams, there is not enough activity to spur further development at this time. "With a one percent growth rate, Juneau's economy is pretty flat," he said. "Overall, the commercial real estate market remains stable."

Over the past five years, the commercial property market has remained stable in Haines as well, according to Broker Christine Turner of Haines Land. Situated at the northern end of Lynn Canal near the mouth of the Chilkat River, Haines is one of the few Panhandle ports where open road connects with the...