AHFC Pursues State Land Opportunity to Support Housing Development

Alaska Housing Finance Corporation is pursuing an opportunity with the Alaska Department of Natural Resources to put State-owned land to work addressing Alaska’s housing needs.

A proposed transfer of land from DNR to AHFC would make parcels of land in communities statewide available to AHFC for potential housing development. Parcels are located in the Fairbanks North Star Borough, Kenai Peninsula Borough and  Matanuska-Susitna Borough.

The effort builds on the charge from Gov. Mike Dunleavy and the Alaska Legislature in FY2025 for AHFC to work with public landholders to identify opportunities to use State-owned land to facilitate housing development.

Putting public land to work

AHFC worked with DNR to identify a larger inventory of State-owned properties and narrow the list to an initial group of parcels that may be suitable for future housing development. Selection was based on factors including proximity to existing residential areas, geographic representation and a web-based assessment of development feasibility and accessibility.

Property selection prioritized locations that could potentially support future community development. Remote sites requiring significant transportation by air or water from community hubs were generally discounted.

Six parcels received Preliminary Decisions from DNR in July 2026 and entered the public review process. Preliminary Decisions for additional parcels are anticipated in early 2027.

The proposed conveyances are being considered under Alaska's noncompetitive public and charitable use process, authorized under AS 38.05.810. DNR's process is designed to allow State land “to be conveyed to eligible public or charitable entities when the proposed use serves a public purpose and is in the public interest.”

Each parcel must proceed independently through the required review process, including an application (from AHFC), a Preliminary Decision from DNR that initiates a minimum 30-day public comment period, a Final Finding and Decision from DNR and an appeal period. If approved and no appeal is received, DNR’s decision becomes effective and the transfer process can proceed to AHFC, including required surveys and assessments.

Land is the beginning not the end of the process

A successful land transfer does not automatically mean housing will be built on every parcel. Instead, the transfer creates an opportunity for AHFC to begin a community conversation about how the land could best serve local needs.

Prior to finalizing any successful conveyance, AHFC expects to work with local governments, builders, developers, employers, nonprofit organizations and community stakeholders to identify appropriate uses and development objectives.

Potential uses could include a range of housing types depending on local needs, market conditions, infrastructure, financing and construction feasibility of individual parcels.

Building on a demonstrated model

The initiative with AHFC builds on AHFC's Lands to Housing Catalyst, launched in 2026 after AHFC acquired 11 parcels in the Mat-Su and Fairbanks North Star Boroughs from a sale by the University of Alaska.

In September 2025, AHFC used approximately $8.5 million in expiring federal funds to acquire the 11 properties for the purpose of facilitating new housing. The properties encompass approximately 600 acres and were subsequently offered through a development opportunity designed to give Alaska builders and developers flexibility to create new housing.

Lands to Housing Catalyst was specifically designed to address one of the barriers to housing development: cost and availability of buildable land.

AHFC completed preliminary site work and feasibility efforts on select properties and then invited builders and developers to develop market-responsive housing concepts. The program allows flexibility for single-family, multifamily, condominium and mixed-use housing, provided projects meet specified requirements for affordability based on use restrictions with the federal funds. The first contracts for development are now underway with the goal of adding new housing to Alaska's stock and benefiting Alaskans who ultimately move into the homes.

The experience provides a model for how public land can serve as a catalyst for private-sector housing development rather than remaining an underutilized public asset.

A strategic response to Alaska's housing shortage

Housing affordability and availability remain significant challenges throughout Alaska.

AHFC's statewide housing work has documented housing cost burdens and shortages across communities, while workforce organizations have identified housing availability as a barrier to recruiting and retaining workers.

The State's housing challenge is also closely connected to Alaska's economic future. When workers cannot find housing they can afford, employers have difficulty filling positions, families may leave communities and businesses face additional challenges expanding.

Publicly owned land represents one potential tool for reducing development barriers. By exploring suitable public lands, AHFC can decrease development costs while creating opportunities to leverage additional resources, including private investment, local contributions, financing or grants. The approach is consistent with AHFC's role as a housing finance and development partner.

What happens next?

The proposed DNR-to-AHFC land transfers remain subject to the State's public review and conveyance process.

For the six parcels that have completed the public review process, DNR is considering public comments and is expected to issue a Final Finding and Decision. Remaining parcels are expected to enter the public review process later in 2026 or early 2027.

Prior to any parcels formally being conveyed to AHFC, the Corporation will work with relevant communities to determine their development objectives to see if these properties are a good fit for the community’s housing needs.

The prospective transfer of land does not guarantee that housing will be built on every parcel. Future development will depend on demonstrated community need, local planning, infrastructure, market conditions, project feasibility, appropriate investment and participation from public, nonprofit and private-sector partners.

The objective is to make strategic use of public land where it can help create the greatest long-term benefit for Alaskans.

FOR MORE INFORMATION

Those interested in receiving information related to potential development can sign up for email updates here. 

 

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