Industrial and commercial warehouse and storage space in Alaska: a quick look at markets in Kenai, Fairbanks, and Anchorage.

• Author: Graham, Chad
• Position: REAL ESTATE

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Kenai

When people mention Kenai real estate, most times they are referring to about a twenty-mile radius that includes Kenai, Soldotna, Kalifornsky Beach, and North Kenai by Nikiski, according to Fred Braun who works for Jack White Real Estate in the area. There have been major projects in the areas and this has been a significant driver for the industrial real estate market in the last few years. Out of approximately thirty-five warehouses, it seems there are only about two that are available for

lease.

Many of the companies that have leased these properties have signed three to five year contracts and are renewing them. In the Nikiski area, more liquefied natural gas (LNG) refinery operations are slated if permits are approved. More than 151 parcels have already been purchased for LNG endeavors. If these projects go through, there will be a boom and a need for commercial leases or purchases to meet the needs.

Fairbanks

After speaking with Pamela Troop at Alaska Commercial Properties in Fairbanks, it appears that there is excess inventory of warehouses per capita. Nothing new has been built in years, and properties are slow moving. Location is important, and when industrial listings are not on the main thoroughfare they are more difficult to lease or sell.

The largest warehouses tend to stay vacant longer because of their size. If they are too large, there is a limited interest. At this time, there are approximately four warehouses available ranging from eight thousand to forty thousand square feet. Most buyers sign a lease for up to ten years, so that is another element that limits availability of choices in the Fairbanks area.

It is a small community with specific needs and the market has slowed down. According to Troop, it is anticipated that it will become even slower with the state's economy. At press time there is an excess of more than 1 million square feet in commercial properties in the area, including warehouses, and some properties take up to two years to sell. There may be US Air Force projects approved in the next few years, however, that could bring about more opportunities for growth.

Anchorage

The industrial vacancy rate at the end of 2014 in Anchorage was 2.4 percent, and it increased to 2.1 percent by the end of the first quarter in 2015. Warehouse projects were at a...