3rd Quarter, 2011 AEDCconnections The Newsletter Of Anchorage Economic Development Corporation WHAT’S INSIDE Diamond Investor Spotlight page 2 More Fuel Means More Letter From The President page 3 Opportunities at ANC JetBlue Airways: Big Start Strategically located just 9.5 hours from 90% of the industrialized world, Ted Stevens Built on Local Partnerships Anchorage International Airport (ANC) is ranked fifth in the world for cargo throughput and second in North America for landed weight. Shipping via Anchorage means planes can page 4 carry more cargo and less fuel, potentially adding up to $90,000 in additional revenue per flight. With stats like that it’s easy to see why so many international cargo flights choose to Partnership at Work in refuel in Anchorage before continuing on to their destination. Redevelopment of Loussac Manor With the national economy recovering and flight frequencies reaching 2007 highs – when ANC saw about 700 wide body landings a week – ANC is seeing more pressure to ensure page 5 an adequate supply of jet fuel. This would normally be seen as a good thing, a sign of growth. However at ANC, this has become somewhat of a problem as the airport itself is Mapping Cooperation neither a buyer nor a seller of jet fuel. page 6 In the past this was a non-issue as most of the jet fuel was purchased from Flint Hill Refinery in North Pole and shipped to ANC via railroad in about 1 million gallon Cargo Transfer: Open for Collaboration increments. Now, much of the fuel is purchased from out–of–state sources and shipped to ANC via tanker in about 14 million gallon increments. page 7 ANC’s ability to handle additional flights is dependent on the availability of jet fuel. Currently, there are 20 million gallons of fuel storage at ANC and another 20 million Anchorage First Thanks Participants gallons of storage located at the Port of Anchorage that is all managed by the Anchorage Fuel Consortium. Airlines at ANC use roughly 14 million gallons of fuel a week. This means that when all the tanks are full there is about three weeks worth of fuel on hand. In order to unload a 14 million gallon tanker the 20 million gallons worth of fuel storage tanks at the Port of Anchorage must be nearly empty. With airlines at ANC using roughly 14 million gallons of fuel a week, that leaves about a week and half of fuel on hand at ANC. This means any delay in tanker arrival has potentially devastating consequences. The Anchorage Fuel Consortium has recently announced plans to add four additional fuel storage tanks at ANC, expanding the current fuel park from five to nine tanks. The project is expected to cost about $25 million and will provide 16 million gallons of additional fuel storage for a total of 36 million gallons at ANC. This extra capacity will relieve the current pressure of fuel shortages and hopefully allow for additional flight capacity at ANC. The project is looking at a completion date sometime in the fall of 2012. 1 Copyright ©2009 Pictometry International Corp. ECONOMIC SNAPSHOT TSAIA Cargo Transit (thousand pounds), 1st Quarter AEDC 948,510 823,322 Letter From 560,710 2009 2010 2011 In the first quarter of 2011, 949 million The President pounds of cargo transited through Ted Stevens Anchorage International Airport, an increase of 15 percent from the first quarter of 2010, and an increase of 69 percent from the first quarter of 2009. Pre-recession, first quarter cargo transit volume was as high as 1.2 billion pounds in 2008. In business, it’s natural to think strategically if you want to be successful. How do I achieve Residential Building Permit Values my objectives? What are the opportunities and (million), 1st Quarter how do I prioritize them? Are there obstacles or $22.8 challenges that I must overcome? And at the end $17.4 $15.0 of the day, how do I measure success? As you contemplate these and many other considerations, the thought may strike you that a strategic alignment may be needed to improve your odds for success. 2009 2010 2011 Residential building permit values totaled And that’s the theme for this month’s newsletter. Cooperation and collaborations $22.8 million for the first quarter of 2011, an increase of 31 percent from the first that grow the economy of Anchorage and Alaska. quarter of 2010, and an increase of 52 percent from the same period in 2009. The highest level for residential building permit values over the last six years was $32.6 In this issue, we will profile many examples of innovative cooperation and million in 2007. collaboration that are generating new business opportunities, new infrastructure, new competitive innovations and ultimately new jobs. Innovative alignments Commercial Building Permit Values created within both the private sector and between businesses and government. (million), 1st Quarter $107.6 $80.0 You’ll read about how JetBlue has aligned with longtime local businesses for key ground services and as customers that have helped set record cargo volumes for this $40.6 innovative air carrier. You’ll also learn about a division of Aerometric, DAT/EM Systems International, that’s developed exciting new mapping tools that are being used to bring Alaska’s outdated topographic maps into the modern age. 2009 2010 2011 Commercial building permit values totaled $80 million for the first quarter of 2011, an increase of 97 percent from the first And consider the exciting opportunities offered by Ted Stevens Anchorage quarter of 2010, but down 26 percent from International Airport (ANC) to cargo carriers. In this issue, we profile the unique the same period in 2009. cargo transfer rights international carriers can take advantage of, as well as the Average Price of Single Family partnerships these rights may now offer between domestic cargo forwarders and Housing Units Sold, 1st Quarter foreign air cargo carriers. We also talk about the infrastructure needed to support 327,429 314,978 319,448 this growth through the addition of four new fuel storage tanks that the Anchorage Fuel Consortium has commissioned to be constructed. New partnerships can show up in unexpected places, even in housing developments. Cook Inlet Housing Authority and Alaska Housing Finance Corporation are teaming in a redevelopment of the Loussac Manor that will provide 120 much 2009 2010 2011 The average price of residential housing needed affordable workforce housing to Midtown. units sold in Anchorage in the first quarter of 2011 was $319,448, a decrease of 2.4 percent from the first quarter of 2010, but 4 percent higher than the first And finally, you’ll read about the successful second year of the “Anchorage quarter of 2009. First” buy local campaign initiated by AEDC, a collaboration marketing effort Number of Residential involving local businesses, media outlets and non-profit organizations focused Housing Units Sold, 1st Quarter on the local economy. 436 417 Cooperation and collaboration. Very effective tools if used correctly as these 397 examples demonstrate. When interests align, the outcomes can be very rewarding! 2009 2010 2011 In the first quarter of 2011, 417 housing units were sold in Anchorage, 5 percent more than in the first quarter of 2010, but 4 percent less than in the first quarter of 2009. The highest first quarter level of Bill Popp housing units sold in the last six years was 579 in 2006. President and CEO, AEDC Economic data compiled by 2 JetBlue Airways: Big Start Built On Local Partnerships JetBlue Airways is off to a big start in the Big Wild, our continued partnerships with NAC and Lynden having broken its own cargo records just one week International, and to a growing relationship with the after the airline’s inaugural flight to Anchorage. Not local freight forwarders throughout this year and in only did the value carrier with high-quality service years to come.” surprise and delight customers from the minute it landed, but it also transported a whopping 17,400 JetBlue launched service between Anchorage, its 65th pounds of Copper River salmon to Long Beach, destination, and Long Beach on May 23, becoming California, the airline’s highest-ever cargo trip in terms the only airline to serve Anchorage from the southern of poundage. JetBlue saw subsequent successful cargo Los Angeles basin. The ability to connect these two loads and continues to enjoy a healthy cargo operation cities has opened many doors not only for cargo out of Anchorage. expansion, but for business and personal travel as well. As the biggest airline in Long Beach, JetBlue offers Anchorage is JetBlue’s 33rd cargo city. The New York- connections around the lower 48, making travel for based airline began shipping seafood and fish products Alaskans even easier. The new service, offering daily in September 2006, and is pleased to welcome seasonal flights for the summer, also means additional Anchorage to the expanding network of cargo cities. access for business travelers flying between Alaska and the Continental United States. The cargo team at JetBlue first looked to Anchorage to increase revenue and to foster relationships with Anchorage and JetBlue seem a natural cultural fit – a freight forwarders. JetBlue is pleased to partner with city built on the idea of Big Wild Life in collaboration Northern Air Cargo (NAC) and Lynden International with an airline founded on the principles of serving and recognizes that the early success it is seeing is a one another and treating people right – make for a result of that collaboration. Carl Shipsky, Manager partnership with lots of potential for fun and future of Mail and Cargo Sales relays, “We look forward to business development.