Housing agency buys 600+ acres statewide to spur development

Alaska Housing Finance Corporation purchased more than 600 acres from the University of Alaska and other public agencies last September. The goal: unlock land for housing development across the state.

The corporation closed on properties in Anchorage, Fairbanks, Seward, Palmer, Wasilla, and Cordova using $8.5 million in expiring federal Treasury funds and $4 million from a 2024 state capital budget appropriation. The initiative targets single-family housing development to leverage homebuyer equity rather than relying solely on rental construction.

"The corporation worked in the last year since Mr. Butcher was here very aggressively, because once again another tranche of federal money was made available that was also expiring, which gave us an opportunity to purchase land that we could then make available for partly affordable housing, partly market-rate housing," Deputy Director Aiki Galopsis told the House Finance Committee Friday morning.

The corporation launched the Lands to Housing Catalyst program in April 2026, offering 11 parcels to developers in the Mat-Su and Fairbanks areas. Letters of intent were due April 24. The agency received more than 30 responses. Every acquired property drew multiple expressions of interest.

"All the properties that we acquired have been spoken for multiple times," Planning Director Daniel Delfino said.

Full proposals are due in June 2026, with results expected by May 2027. The corporation aims to begin construction in summer 2027.

The land purchases followed a year of work identifying properties that could reasonably support housing development. The corporation worked with the University of Alaska, the Mental Health Trust Land Office, the Alaska Railroad, and the Department of Natural Resources to assess which parcels could legally be transferred and were suitable for construction.

"We did environmental reviews, we did site visits, we did a lot of due diligence on the sites and crossed off a lot of parcels in the process," Delfino said.

The initiative builds on the corporation's Last Frontier Housing Initiative, which delivered housing in five hub communities between 2024 and 2025. That program produced 58 units in Saxman, Sitka, Bethel, Nome, and Kotzebue by working directly with local governments to identify barriers to development.

The corporation structured the new land program to attract single-family developers because homebuyers bring substantially more equity to projects than rental developments typically generate. Multifamily rental projects usually support about 15 percent of development costs through debt. Single-family buyers can contribute $300,000 or more in mortgage equity per unit.