Proposed Mixed-Use Building Combines Public And Private Money
SIOUX FALLS, S.D. – City of Sioux Falls administrators unveiled a project that could not only be the largest single-investment in downtown history, but also create one of the tallest buildings the city’s ever seen.
A 13 story building on E. 10th and S. Mall Avenue that will include 525 parking spaces, 120 hotel rooms and 37,000 sq. ft. of commercial space, is what city officials say is needed to finally fix a lack of downtown parking.
“The need for this is as strong as it’s ever been, you can see that our occupancy has increased over the years,” says Community Development Director, Daren Ketcham.
The project will cost $50 million dollars; $21.3 million will come from public investment. So as for the city, “it’s really going to be bond proceeds and cash,” says City Finance Director, Tracy Turbak.
Turbak says $4 million will come from the parking enterprise fund, and $16 million will be paid through sales tax bonds.
“But will be re-paid from parking system revenues, so no sales tax dollars will be used,” he adds.
As a private investor, Legacy Consultants will be fronting the remaining $30 million dollars.
“Thirty million dollars; what a fantastic opportunity for our citizens, for our visitors and for our businesses,” says Ketcham.
In return, Legacy will design, operate and manage the hotel and commercial space during an 80 year lease. The company will also pay the city $1 million for developer rights.
“I think it’s exciting,” says Councilor Christine Erickson who thanked the city and developers involved in the project.
While many councilors applaud the plan, some aren’t ready to move forward since the project will mix private and public money.
“I would love to see us put this off until we have our next administration in place,” says Councilor Theresa Stehly. “It’s a new thing, we’ve never done it before, and I don’t think the public is on board with that.”
Other councilors also question the price of the project. In previous presentations a similar structure was expected to cost the city $18 million. But city officials cite inflation for the increase.
The City Council will take up the proposal at their November 21 and December 5 meetings. If approved, construction will begin spring of 2018, and the first full year of operation will be in 2020.