Juneau is the only state capital with a glacier—the Mendenhall—just minutes from downtown, one reason it saw a 4 percent growth in tourists last year. Another is the city's remoteness: Situated on the water and at the base of steep mountains, Juneau is accessible only by boat or by plane. Founded in 1881 and named after a gold prospector, the city became Alaska's capital in 1906 after it overtook Sitka, about 100 miles to the south, as the state's commercial hub. “Juneau's business climate today can be described as a balanced mix of tourism, government, and service industries,” says local commercial real estate broker Carlton Smith. “Mining is on the upswing. … The [soon-to-open] Kensington Gold Mine will provide over 225 full-time jobs for at least a decade.”
Boosters expect economic diversification to continue, as some are pushing to move the capital again. “Juneau has a continuous struggle to maintain its role as state capital in the face of accessibility concerns,” says Paul Voelckers, principal at local firm MRV Architects. “The state is vast, and Juneau's physical isolation contributes to efforts to shift the political center to Anchorage, the seat of most of Alaska's population.”
The city is doing its part to retain its capital status, working to revamp the waterfront and port to encourage more cruise ship business. And Juneau's location near the extreme southeast of the state ensures its continued role as the primary gateway from the lower 48. “We've got a great location,” says Lance Miller, executive director of the Juneau Economic Development Council. “We're only one hour and 50 minutes from Seattle. That's shorter than some people's daily commute.”
Job Growth
In 2007: 5.46 percent.
Office Market
Monthly rates: $2.10 to $2.45 per square foot, full service gross, for the past two years.
Residential Market
Median home sales price in 2007: $309,848.
Market Strengths
- 4.7 percent unemployment (state: 6.7 percent)
- Rising average income
- Increasing home values
Market Concerns
- Steep increase in inventory of homes for sale
- Efforts to move legislature
- Low housing affordability
Forecast
“As one of the largest municipal governments in the United States in total land area, ... Juneau will need to provide incentives for building affordable housing in partnership with local developers,” says Carlton Smith, a local real estate broker. “Further, municipal planners must address the scarcity of industrially zoned land, which will soon limit business and service expansion.”
