Construction industry gears up for busy season: Alaska's contractors look forward to fourth straight year of prosperity.

• Author: Martin, Gary L.
• Position: Building Alaska

The crystal ball used to make 2004's positive construction industry predictions, published in the January edition of Alaska Business Monthly, is proving to be very accurate. Many of Alaska's construction companies are savoring the prosperity for the fourth straight year.

According to Dick Cattanach, executive director for Associated General Contractors of Alaska, 2004 should be another excellent year for the industry.

"We are predicting construction volume this year to be about $5.3 billion, which is about 20 percent of the state's gross annual product of $28.5 billion," he said.

Home building in Alaska is still very good and should remain that way, at least as long as the interest rates remain low. According to the latest study by the U.S. Census Bureau, Alaska's home ownership rate has reached an all-time high.

While Alaska's home ownership rate has traditionally been lower than the rest of the nation, in 2003 that mark reached 70 percent. For the first time on record, Alaska was higher than the national rate of 68.3 percent, according to Dan Fauske, executive director of Alaska Housing Finance Corp., a state lending agency.

Between 1994 and 2003 the cost of a single-family home increased some 44 percent, from $145,321 to $209, 416, added Fauske, who says AHFC financed 37,957 homes between 1994 and 2003.

Rita Hamilton, president of Alaska Home Builders Association in Juneau, agrees that it is going to be a very busy season. And while Anchorage is leading the pack, followed by both Juneau and Fairbanks, Juneau and Anchorage are both closing in on the same brick wall.

"Both cities are about to run out of buildable land," Hamilton said. "The city and state own most of that land. In Juneau, the builders and the city are working together to try and find a way to release some of it.

"I know in Anchorage they're having an awful time; there are not lots to build on. It comes back to the 'NIMBY' or the not-in-my-backyard syndrome. Once some people get their house built, it seems like they don't want anyone to build around them; they want to keep development away from their homes."

The Mat-Su Valley is another place where there is excellent growth potential, and when the Knik Arm Bridge becomes a reality, major changes will take place. "I think the bridge will affect many things in Wasilla, not just construction," said Sandra Garley, Wasilla's city planner. "But it will depend on which plan they adopt.

"If the bridge is built using the current plan, there will be a major effect. That's because the road to and from the port, from the Mat-Su Borough, goes through Wasilla."

Garley went on...