In spite of a downslide in state revenue due to a drop in oil prices, the retail sector of Anchorage continues to thrive. While some box stores may be seeking to downsize or rent out extra space, commercial real estate continues to be in high demand in Anchorage according to property management sources. This keeps the city’s commercial vacancy rates around one third of the national average of retail vacancies. While some remain nervous because they feel the effects of the oil price crash may not be felt immediately by retailers, this hasn’t seemed to stop many new businesses from resizing, opening, or breaking ground for new stores.
Some of the newer businesses expected to open in Anchorage include an artisan market in the old Spenard La Mex building, Ulta Beauty, Men’s Warehouse, and Pier 1 Imports at Tikahtnu Commons, and a 35,000 square foot H&M Clothing store and several other outlet retailers at Diamond Center Mall. This list goes on to include many new dining establishments and even a 120 room hotel. It is expected that Anchorage’s retail sector will continue to grow due to the surge in the economy of the United States.
It is thought that even with the drop in oil prices, that Alaska is better able to handle the situation now than it would have been back in 1986 when both commercial and residential real estate prices plummeted. This is due to interest rates currently being historically low, and because the state government has money in the bank and Alaska is now more economically diverse than before. While oil prices may have dropped, so did government spending.
Aside from the booming retail scene, there are still some concerns about the economy in the Anchorage area. The area is expected to lose hundreds of jobs in 2016 and there is also a lack of available housing in the area which can drain the economy and also prevent new workers from becoming a part of the city’s work force.
To bring in new workers to the area, it is said that Anchorage needs to find innovative ways to attract them to the community. This might mean the development of higher-density housing projects, which would require the city to change some of its zoning regulations. Other ideas might include introducing a new brew pub to the area which would tend to attract a young workforce. In turn, this leads to more people working and living in the area, which means that the economy gets a boost.