Amazon opens first Alaska ground-delivery station in Anchorage

The world’s largest online retailer has opened its first ground-based delivery station in Alaska in an effort to speed up package delivery in Anchorage.

Deliveries from the 66,000-square-foot building began in November, said Natalie Banke, a spokesperson with Amazon. It’s a “last-mile facility,” a final stop in Amazon’s logistics network before packages are delivered by van to Anchorage residents and businesses.

It will take several months to ramp up the operations to the point that deliveries occur as swiftly as the company plans, she said. Part of that effort will involve becoming more efficient, such as determining the best road routes, she said.

The goal is delivering packages to Amazon Prime customers in Anchorage within a few days, compared to what can currently sometimes take much longer, even weeks, she said. The faster shipping is free for Amazon Prime customers, but non-Prime customers can pay extra for it, she said. The service will be available in Anchorage but not in surrounding areas, Banke said.

Amazon has already hired more than 100 part-time and full-time workers to work at the newly renovated site in the center of Anchorage near Dowling Road and the Old Seward Highway, said Banke.

Anchorage has faced a severe worker shortage for several years, driven by a strong labor market in the Lower 48 that has reduced the number of people moving to the state.

Amazon has offered starting pay at $20 per hour with comprehensive benefits plus training and educational opportunities, she said.

The company was able to fill the job positions in a “very timely manner,” she said.

“We’re excited to continue to grow in Alaska and deliver for customers,” Banke said.

She said Amazon has invested more than $20 million in Alaska since 2010, including in infrastructure and employee compensation.

In 2021, the company launched an Amazon Air Gateway at Fairbanks International Airport, she said. The gateway receives regular shipments from the Lower 48 and opened new areas of the state to Amazon delivery, using third-party deliveries such as the U.S. Postal Service, the company said.

Amazon Air also brings shipments to Ted Stevens Anchorage International Airport, the source of packages for the delivery station, Banke said.

Most of the vans parked at the Amazon facility are white and not branded with the Amazon logo. But they will be later, Banke said.

The upgrades at the delivery station at 5900 Old Seward Highway largely took place over the summer. They were expected to cost about $26 million, according to a prospectus by a real estate investment adviser describing aspects of the Amazon project.

It had been a Sears warehouse. Amazon is calling the site WGE2, based on a company code for buildings, Banke said.

“We’ve been very fortunate with the hiring process for this station and are grateful for the team we’ve built and continue to grow,” shared Austin Empey, the site leader of WGE2, according to a statement provided by Amazon. “Once our operations are fully ramped, we’re excited to deliver for our customers in Anchorage.”

The prospectus said the increasing global importance of cargo operations at the Anchorage airport was a factor in Amazon’s decision to invest in the facility, as well as road improvements along Dowling, providing quick access to the city’s road network.

Amazon said in the statement that packages at the delivery station will be sorted by ZIP code and organized by routes. They will be delivered by Amazon’s delivery service partners, those business owners with companies that deliver exclusively for Amazon, and Amazon Flex drivers, independent contractors delivering packages with their own vehicle.

Alaska’s governor and Anchorage’s mayor issued welcoming statements in the Amazon-provided statement.

“E-commerce has transformed life in the 21st century, and Amazon’s new delivery station in Anchorage helps Alaska capitalize on the jobs and other benefits this growing sector creates,” said Gov. Mike Dunleavy.

Anchorage Mayor Dave Bronson said the center will help improve the local economy.

“We are confident that this will be a win-win for both Amazon and Anchorage,” Bronson said. “We are committed to working with Amazon to ensure that their operations in our city are successful and that they have a positive impact on our residents and businesses.”