Palin effect could boost property market in Alaska

Real estate developments could open up in Alaska thanks to the state's international exposure since its governor Sarah Palin was named as presidential candidate John McCain's running mate, it is claimed.

Anchorage's remote location may not make it an obvious location for developments but the high profile is creating a stir and could open real estate investment opportunities, according to Darryl Browman, president of California-based Browman Development.

'The exposure has opened people's eyes to the potential of the area,' said Browman, whose company is developing retail centres in Anchorage and suburban Wasilla, Governor Palin's hometown.

Alaska, which has supported a Democratic president only once since it became a state in 1959, is largely expected to vote for McCain. If he does become president, some maintain that Anchorage's economy and ultimately its real estate market could benefit.

'That's because Republican policies are seen to traditionally favour the resource development that is a crucial driver of the area's job growth,' said John MacKinnon, executive director of the Associated General Contractors of Alaska.

Of particular concern is a future administration's potential impact on plans for a natural gas pipeline that could cost more than $30 billion.

Property owners in the Anchorage region, the resource rich state's largest metropolitan area with more than 300,000 people, have benefited from higher oil prices that increased demand for the state's energy deposits. Job levels rose 0.8% in August and though that growth rate has slowed, it still outperformed the net loss in jobs seen nationally, according to the Bureau of Labor Statistics.

Office and industrial vacancies are in the low single digits and that has helped spur developers to build larger speculative office buildings for the first time in years, according to Jeff Thon, a senior commercial broker with Jack White Commercial in Anchorage.

The 14-storey JL Tower, topped with a four-storey sculptural light element, was completed in June. Major players like Chevron Corp. and engineering giant Fluor Corp. have already moved in.

There is confidence in continued demand for more office space. Leonard Hyde, president of Anchorage-based JL Properties Inc. which developed JL Tower, is moving forward with another speculative office building nearby that is partially released.