- Real Estate
- Food & Drink
May 15, 2019
By Steve Young, for SiouxFalls.Business
A collaboration of nonprofits involved in community service is buying the South Dakota School for the Deaf campus in Sioux Falls with the intent of turning it into a “mall of services” for lower-income residents and those challenged by poverty.
Rich Merkouris, board chair of the Sioux Falls Ministry Center, said his group reached an agreement with the South Dakota Board of Regents in mid-May to purchase roughly 14 acres and buildings on the School for the Deaf campus for $6.9 million.
The Ministry Center also is looking at between $1.5 million to $2 million in renovations for the classrooms, boarding rooms, gymnasium and green space it’s buying from the Board of Regents, Merkouris said. That will include roof repairs to and removing a pool from the old gymnasium, installing sprinkling systems and bathrooms in some of the facilities, and more.
The new owners are proposing to remove the track and turn at least a portion of the green space into four soccer fields for public use, Merkouris said. “We believe there’s a need in the community, especially in the lower-income core of the city, for soccer field access,” he said.
They could potentially build on the remaining green space, Merkouris added.
“We’re in conversations with other nonprofits, with other community people, about what the greatest need is and what best goes along with the plans for the rest of the campus,” he said. “We want it to flow together where everything is unified and focused on the same thing.”
When the purchase and renovations are complete, it will be called the Empower Campus, Merkouris said. The eight tenants of the Ministry Center — nonprofits involved in everything from child care to counseling and after-hours acute medical care to work with refugees and immigrants — will move from their current location in the old Stewart Building at Second Avenue and 11th Street.
Merkouris said there also are ongoing conversations with at least five other nonprofits about potentially moving onto the campus, as well as the Boys & Girls Clubs of the Sioux Empire.
“Our vision for the Empower Campus is to really have a mall of services that span from providing care from birth all the way through the adult ages,” he said. “The goal is to have as many organizations together in one place as possible to save expenses and make it better for the guests.”
The site is a prime location for the lower-income population the campus will serve, with a nearby bus route and multiple resources for the homeless within a half-mile.
Kevin Schieffer, president of the Board of Regents, confirmed that an agreement had been reached for the $6.9 million sale and was approved by his board during a May 14 teleconference. Closing on the sale is expected in the next month or two.
The South Dakota Department of Health had moved to the campus in the past year and was renting 23,000 square feet. Though Board of Regents’ meeting minutes have indicated the Health Department was expected to rent for at least 10 years, Schieffer said “all of the state and regental institutions currently on that campus will ultimately be leaving there.”
Merkouris said tenants on the campus likely will remain roughly four months after closing and then relocate elsewhere.
“Then we as Empower Campus will hopefully begin occupancy anywhere between four and eight months (after the closing),” he said. “Our goal would be to start renovation work in about four months.”
The School for Deaf property had been for sale since 2014 but was in a holding pattern since September 2017, when a state task force told regents not to sell the property unless someone was willing to pay more than its appraised value at the time of $6.6 million.
In fact, Celebrate Community Church made two offers to buy the campus in 2018 with the intent of expanding its congregation and outreach services. According to published reports, Celebrate’s first offer was rejected by the regents because it didn’t meet the appraised value. The second offer fell through after the state declined to fix issues found during the inspection process, the published reports said.
The Sioux Falls Ministry Center was negotiating to purchase the property in January 2019 but ran out of time to meet the regents-imposed deadline to make that transaction happen. Merkouris said additional relationship building since January among state government, local government, nonprofit and business interests — including input from Sioux Falls Mayor Paul TenHaken and Gov. Kristi Noem — changed the outcome this time around.
“The biggest change was them (TenHaken and Noem) conversing with people and helping to move things forward,” Merkouris said. “This time was different in that we had some more open conversation about what the needs of the state were in the transaction and what we needed to have to make it happen.”
TenHaken supports the idea of having nonprofits work together to strengthen some of their efforts.
“There are few projects that have excited me more in the past year than this one,” TenHaken said. “This is literally a once-in-a-lifetime opportunity for the core of our city and for the future generations that will be served at this campus. Gov. Noem also sees the vision and investment in people that this campus will provide, and her support has been invaluable in getting us to this point.”
The state’s need for all the space and facilities on the campus began to dwindle 12 to 15 years ago as the number of students being served started declining, the dorms closed and the mission of the School for the Deaf became more focused on offering and expanding its outreach services. Under Gov. Dennis Daugaard, discussions about selling the property began; talks that continued under Noem, Schieffer said.
Because the campus would have been hard to use for commercial purposes, the sale to the Sioux Falls Ministry Center “is going to be a much more efficient use of the space,” Schieffer said.
“It reduces the state’s footprint, which I know was a big objective of both Gov. Daugaard and Gov. Noem,” he said. “I know there are a lot of city and state interests being served here, so all in all, the way it turned out I think is a good step forward. I think it’s just good to have it done. It’s been a long march.”
A roller coaster ride is what Merkouris called it, especially over the past 60 to 90 days. But he, too, is glad to see the finish line.
“In the midst of that roller coaster, the overarching desire from not just a handful of people and nonprofits but from a majority of people wanting to do something that’s going to benefit the community as a whole, made it so it wasn’t discouraging,” Merkouris said. “It kept it doable even in the midst of some of the challenges.”
They got a deal done: A collaboration of nonprofits is buying the South Dakota School for the Deaf campus in Sioux Falls with the intent of turning it into a “mall of services” for lower-income residents and those challenged by poverty.