City opens negotiated sales with developers for rail yard land

March 27, 2019

The city of Sioux Falls has changed its approach to working with potential developers of the downtown rail yard, a move that could lead to a land sale in the coming months.

The city previously requested and evaluated proposals, choosing to move forward with a plan that ultimately was dropped on 4 acres near 8th & Railroad Center.

The new process is open-ended and allows developers to submit proposals on any piece of the 10-acre property the city acquired from BNSF Railway. City officials then can decide whether to begin negotiations on a potential land sale.

The available property is listed on the city’s website. Applicants must submit a site plan, building elevations and a detailed scope of work.

“It’s more of a collaborative process with the people submitting,” urban planner Dustin Powers said. “In the previous process, you had a hard deadline, and there really wasn’t any communication between us and them prior to submittal. This is a little more open approach, so if people have questions we can collaborate, and it’s a little more consistent with how the private market operates in terms of real estate. Going through a formal RFP doesn’t attract a lot of people to want to submit.”

Before selling land, the city still has to go through a public approval process with a City Council vote.

The open-ended opportunity to submit a proposal also allows the city to market the land to a greater audience for a longer period of time, Powers said, including prospects the Sioux Falls Development Foundation or Governor’s Office of Economic Development might be working with as they market the city.

“If they know the land is development-ready and open, they can share this as an additional site for companies that would be interested in Sioux Falls,” Powers said.

“We want to work with projects and developers who are going to complete construction in a timely manner. We don’t want to sell property that will sit for five years before development.”

At the same time, the city has committed to an expedient internal review of proposals, he said.

“It depends on the proposal. If we get a proposal that’s out of the park, has everything we want and doesn’t ask for a lot of assistance from the city, the review can go a lot quicker as opposed to a project that has a lot of requests of the city or maybe doesn’t align with exactly what we laid out,” he said.

“But we do want to do it in a timely manner. The purpose is to reduce the time of review from our previous process.”

There has been consistent interest in the property since the first request for proposals was closed last year, he said.

“There have been a number of individuals and developers who have contacted us interested to see when it’s going to come on the market again. We’ve had quite a few of those conversations, and we hope now that it’s out there that those who have shown interest are definitely looking at it. And we’ll work on getting the word out even further to see if others will be interested as well.”

Additional city-owned properties could be added as potential negotiated sales to the city’s website going forward, he said.

“From time to time, we get calls asking about certain city properties, and we’re open to those conversations.”

Black Iron Railyard project loses city support

City opens negotiated sales with developers for rail yard land

The city of Sioux Falls has changed its approach to working with potential developers of the downtown rail yard, a move that could lead to a land sale in the coming months.

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