hat’s an Alaskan gearhead to do? “Alaskans tend to have a lot of toys, maybe more than any other state,” says Yvan Corbin, owner and CEO of Top Shelf Realty. All those RVs, ATVs, motorcycles, snowmachines, jet skis, boats, and trailers take up space. If home isn’t big enough, off-site storage can help, but monthly fees can drain a budget.
Corbin’s company and other developers have an alternative: an extra garage.
One of those other developers, GarageTown Anchorage, asks on its website, “What’ll be in YOUR garage?” Emphasis on the possessive highlights the key feature: these properties are bought and owned. The complexes are managed like condominiums with a homeowners association (HOA) and access controlled through locked gates.
GarageTown’s site on 79th Avenue in South Anchorage is locked out, though, with all units currently sold. Ditto its forerunner site about a half mile away near the East Dimond Boulevard curve. Demand has been outpacing supply, says Andre Spinelli, whose family developed the GarageTown properties in Anchorage.
“A lot of people wanted them but couldn’t get them, so a few other small projects popped up,” he says.
Corbin says he noticed the development along the freeway before the owner contacted him to sell some units. “I’ve gone to that go-kart track many times and taken my kids there, so yeah, it’s weird,” he says.
Top Shelf Realty developed its own garage condos in the Oceanview neighborhood along Old Seward Highway. “They’re garage condos with offices up top, with a mezzanine that can be used as an office,” Corbin explains. “They’re zoned commercial [I-1], so someone could actually use it as a storefront, put a sign up over the garage door.” As with Able Garage Condos, some are for sale while others are reserved for the developer to lease.
In Midtown, the vacant lot that was, long ago, the site of the high-rise Northern Lights Hotel is marked for revival as garage condos. Guy Burk, whose dental clinic and other ancillary businesses are adjacent to the property, is leading that project.
And earlier this summer, Spinelli finished a complex on Lake Otis Parkway near Dowling Road. “We started closing units and moving people in around the first of June,” he says. The family-owned general contractor, Spinell Homes, of which Spinelli is president, built the complex, while a separate partnership, AK Garages, handles the sales component.
Able, Top Shelf, and AK Garages all at once, with Midtown waiting in the wings: Garage condos are having a moment. Spinelli says, “That’s just kind of random, that the timing of their project and my project hit at the same time.”
He recounts that an acquaintance of his father got involved with the GarageTown franchise in Idaho and suggested bringing the format to Alaska. “You gotta have a clubhouse and a few other things to meet the GarageTown standard,” Spinelli explains.
That’s how it used to be. “It was just us doing it. We were building to whatever we thought the demand was,” Spinelli says. And then others started dipping their toes into garage condos.
These properties fill a need that rented self-storage can’t. Corbin says, “They’re typically bigger spaces. They’re very tall; a lot of storage units aren’t big enough for boats, trailers, or whatever.”
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“For $500,000, give or take, you have a storefront, and you own it. That’s not a bad deal. If you look at most of the places for sale in Anchorage where you can run a business, for 500 grand you don’t get much,” Corbin says.
Gated access at most of the complexes limits customer traffic, but owners can come and go at any hour. “You get the ownership feeling,” Corbin adds. With ownership comes personalization, which is how units become fully furnished lounges. Can’t do that in rented storage.
Plus, owners accrue equity. Corbin says, “I’ve sold a few older ones in the Huffman Park area. Every single one that’s sold, they’ve all made money.” He adds that most of the units he’s sold are owner occupied; subleasing is rare because buyers typically need a garage condo for themselves.
When they need to sell, though, “Some of these units have seen a lot of appreciation, so it turns into a real estate investment,” Spinelli says.
Of course, investment properties also include homes, and homes come with garages, but Corbin doesn’t see that as a viable alternative to a garage condo. “A lot of times people are like, ‘Shoot, I could just buy a house and have a garage with it.’ True, but if you look at the average single-family home price in Anchorage [$520,000], it’s expensive,” he says. Furthermore, “With that, you’ll get the traditional two-car garage, anywhere from 400 to 440 square feet—that doesn’t go very far. It gets filled up pretty quick.”
“They’re not for everyone; they’re very expensive,” Corbin says.
One of the Top Shelf units on Old Seward Highway is listed for $549,800. The Garage at Lake Otis has more affordable options, from $255,200 to $522,000. “The biggest one is a 30-by-60-foot unit with garage doors on both ends that you could drive through. It’s mind-boggling to me how expensive these things are these days,” Spinelli says. Plus, HOA dues for that deluxe model run $250 per month. Yet Spinelli is amazed that Alaska has enough buyers willing to pay the premium.
Corbin notes that he doesn’t have a sales pitch; buyers seek him out. “A lot of car owners or RV owners would rather keep their stuff in heated storage than outside or unheated spaces,” he says.
Snowbirds who motorhome around Alaska in summer might own a garage condo for storage in winter. Also, as the population ages, Corbin has seen garage condos as a solution for those who are downsizing into smaller homes. “They had a big garage and they’re moving to a condo or whatnot; they just don’t have a lot of space anymore. They don’t want to get rid of all their stuff; they want their nice summer car or RV or boat,” he says.
Garage condos are also ideal workshops for both hobbyists and professionals. “There’s guys putting CNC machines in these things. People expanding into the world of 3D printing and micromanufacturing have used these things. I’ve seen everything,” Spinelli says. “Handymen and small contractors are buying them to have an office and shop and bathroom—a home base.”
Oh yes: a toilet and sink come standard. “A couple of people have upgraded to add showers,” Spinelli says.
“If you have a bathroom in yours, wow! It makes it easy to spend a few hours there or create a little gentleman’s club,” Corbin adds. “Some people have put pool tables up there, golf simulators. Because of the bathroom and having access to a shower, it really gives you a lot of different options as to what you can use it for.”
“Someone could always try; I don’t know how hard everything is being policed,” says Corbin. A car parked outside for months might prompt a neighbor to report a violation of HOA documents or city code enforcement.
Spinelli says, “Getting these things approved, the municipality was like, ‘What’s to stop somebody from living in there?’ Well, guess what, we’re not the police. We’re just a builder. The city ended up making it so you’re not allowed to live there, in the HOA documents.”
He adds that other local regulations disqualify garage condos as housing. “The Lake Otis property is built on B3-zoned land. B3 does allow for multifamily, but it’s the city building codes,” he says. “The main reason the HOA rules don’t allow it is because the building is not built that way.”
While Anchorage is desperate for more housing, Corbin doesn’t see garage condos as conflicting with that need, at least not in all cases. “The land where they’re doing it is not residential, so I don’t think it’s affecting that anyway,” he says.
Spinell Homes has experimented with mixed-use development. “I did a project on Spenard and 31st a couple years ago where we put one-bedroom apartments above these garages, and the one-bedroom apartment drove the price up so much that they were difficult to sell,” Spinelli says. “There’s more people that want a garage; they don’t want an extra $200,000 to put a one-bedroom apartment on top. Putting that housing on top is pretty expensive.”
As one of the premier homebuilders in Anchorage, Spinelli is very aware of market conditions. “At the end of the day, we’re a general contractor that needs to turn a profit and keep our guys busy, keep our subs running,” he says.
To Spinelli, the garage condo at Lake Otis was a $16 million commercial project that kept Spinell Homes employees and subcontractors cashing paychecks. The only difference, if they had been building a house instead, he says: “The construction type is a bit simpler than housing. It’s a little less intricate.”
He doesn’t expect many more garage condos to be built until land prices go down and skilled labor is more available. “All the moving parts that go into building are insanely expensive,” Corbin says.
He doesn’t expect a boom of garage condos in the Matanuska-Susitna Borough, either. Although the area is seeing far more residential construction than Anchorage lately, “A lot of the people have bigger lots, so they’re building detached garages and whatnot, keeping everything there,” Corbin says.
There is one development, Mat Valley Man Caves, east of Wasilla. “This development was constructed by a team of established contractors in the area that wanted to have safe, secure, and high-quality storage options for personal and business use,” says Emma Shibe, an associate broker with RE/MAX. In one building, businesses own two of the units, individuals own two, and one is for sale. A second building has seven units. “That building was purchased in its entirety by an investor, who now leases the units for personal and business use,” Shibe says, and she is not aware of other Mat-Su projects.
The sudden surge of very visible garage condos is likely near an end. Spinelli says, “I really do feel that the market is somewhat saturated. I have guys that are pitching me on new locations, and I’m telling them, ‘I’m not quite ready to go there yet.’”
The garage condos that have been built will remain useful for the long term, as Corbin sees it. “I think they’re good investments. I don’t think they’re going to go down in value; I think they’re going up,” he says. “We might have reached the saturation point. If no more get built, then these will stay popular.”