It’s Happening: New I-90 Interchange Expected To Drive East-Side Growth


A massive road project more than a decade in the making is about to become reality. The long-awaited connection between South Dakota Highway 100 and Interstate 90 will start construction next year, after a winning bid came in just under its estimated $55 million cost.

The South Dakota Department of Transportation projects the work will last more than two years. But when it’s done, the effect on development on the east side is expected to be significant. “This is a regional corridor that is a backbone of the growth and development the city laid out 15 to 18 years ago,” said Mark Cotter, the city’s director of public works. “It will be a nice complement to having really smart, managed growth.”

New opportunities

The DOT’s estimated completion date for the project is Aug. 28, 2020. Riley Brothers Construction from Morris, Minn., submitted the winning bid and will start initial work in January. No work will be done on the interchange in 2018. Instead, crews will work up from the south where a segment of SD 100, now known as Veterans Parkway, was completed this year from Maple to Rice streets.

“Most likely in April, we expect Timberline Road to be closed and grading work to begin at Rice moving north,” said Travis Dressen, the DOT’s Sioux Falls engineer. “The interchange will be completed in 2019.”

The project involves five separate bridges, crossing the Big Sioux River and railroad lines. “This is probably one of the largest (projects) we’ve seen in the Sioux Falls area all time,” Dressen said.

The impact goes beyond Sioux Falls, Cotter added.

“Regionally, there has been so much positive growth in Brandon, Corson, Garretson, so to have all those daily commuters be able to take advantage of this will be really good,” he said. Property owners in the area have been waiting for the milestone, too.

Xcel Energy and BNSF Railway own much of the property near the interchange itself. Farther south, it’s largely a mix of development and farmland owners.

RMB Associates owns almost 200 acres on both sides of Veterans Parkway north of Madison Street.

Uses will be “just about everything you can think of,” CEO Joel Dykstra said. “There’s commercial along Madison on the south side and then it goes into a lot of multiuse, live-work and single-family residential.”

While the property hasn’t been heavily marketed, there has been an uptick in sales at the nearby Canterbury Heights development, which he said bodes well for future growth.

With Rice Street done, “I expect to see and will be watching for signs of increased development,” Dykstra said.

“Apartments, maybe some light industrial. The thing out there is there are so many attractive building sites for homes, and I think we’ll see a lot of demand in that area as some of the higher-end development options for homes have been pretty well used up.”

The bidding of an I-90 interchange is “tremendous,” he added.

“Until the bids are done and the money is committed, it’s always possible a project could get put off. So we’re pleased to have this commitment, and we’re actually going to see this go forward. That’s a significant step.”

Developers of the Foss Fields projects are equally enthused by the progress.

This 400-acre development will occupy both sides of Veterans Parkway between Arrowhead Parkway and Madison Street.

“We’ve got a substantial amount of Foss Fields that is residential, with apartments and homes, and we may start that first because it helps market what we have there as a business park and retail,” said Joel Ingle of C-Lemme Cos., one of the developers of the land.

Having a time frame for an I-90 connection “is huge,” he added. “It’s a game-changer really for the east side of Sioux Falls. All of the retail and business park development is dependent on traffic, and the traffic flow on that highway changes immensely the traffic flow to the east side, and that’s what excites retail businesses about being in the area.”

The property is listed with Ryan Tysdal of Van Buskirk Cos.

“Over the past few years, we have had conversations with large retailers to kick off the next wave of retail, which will move north from Menards,” Tysdal said.

Land was under contract with Sam’s Club in 2013.

“Although that deal didn’t come to fruition, that is the size of retailers we are working with as we work to expand the retail footprint,” he said. “Any big-box retailer over 75,000 square feet will go north, as there is no additional big-box zoning – C-4 commercial – remaining south from Century Theatres.”

He sees grocery, home improvement and hardware stores as good potential fits for the property. And while the final connection to I-90 is critical, even having a connection to Rice Street done “will be huge for retailers on the east side,” Tysdal said.

“It’s not a four-lane highway that dead-ends in a cornfield anymore. Connecting to Rice Street provides quick and convenient access directly into the east-side retail district.”

Completed road drives development

The economic effect of building Veterans Parkway can be seen in the developments that followed construction of the first several miles. 

Beginning with Dawley Farm Village in the mid-2000s, the land west of Veterans Parkway near Arrowhead Parkway has developed into a significant retail center with a growing tenant mix and residential population.

Buffalo Wilds Wings now is under construction on the property along with another retail building, and land is under negotiation for additional development south of 18th Street that would serve the nearby growing neighborhood.

“We’re excited about that because with the housing and shopping out there we see opportunities for dentists, insurances and other services,” said Raquel Blount of Lloyd Cos., who represents the development.

The eventual connection to I-90 should bring additional business from nearby cities and states, she added.

“Everything is time. So if it’s a shorter travel trip to get to the retail development, there could be more frequent trips.”

Avera Medical Group was among the early believers in the location, opening a clinic at Dawley in 2012.

“We have been impressed with the growth of this clinic,” said David Flicek, CEO of Avera McKennan and chief administrative officer of Avera Medical Group. “Avera saw tremendous development opportunity on the east side of Sioux Falls, and we’re proud to offer clinic services and urgent care at Dawley Farm.”

The health system owns eight acres nearby at 26th Street and Veterans Parkway, but “no decisions have been made as to what will go at this location,” Flicek said.

New apartments, sports center

The Evangelical Lutheran Good Samaritan Society recently sold its 12 acres south of 26th Street and east of Veterans Parkway to North Dakota-based Enclave Development.

The company is building Silverthorne Flats, an eventual 230-unit apartment complex that recently started construction of its first 42-unit building and clubhouse.

It’s the company’s first Sioux Falls project.

“We’ve been looking in the market for quite a while, and this is a site we’ve been working on, so we’re excited to enter the Sioux Falls market,” president Ben Meland said. “We’ve done a lot of research and think this product will fit well in the community and be a great addition.”

The complex will offer efficiency apartments starting at less than $800 a month up to three-bedroom units. The first residents are scheduled to move in this spring.

“We have higher-end finishes but are offering good-size units competitive with the town home rental in the three-bedroom, but one of the things we noticed is very few of the market participants are building efficiencies and one-bedrooms, and we’ve found those to be some of our most successful units,” managing director Austin Morris said. “I would say we’re bringing something that’s a unique class to Sioux Falls.”

Amenities will include a fitness center, main lobby coffee bar, club room with a full kitchen and games, outdoor pool, and pet washing and grooming areas.

The nearby area, though, was the selling point for the company.

“Probably the biggest draw was it’s right on Veterans Parkway … that will provide better connectivity to retail amenities and proximity to schools and churches,” Morris said.

“It’s nice to provide amenities on-site, but what’s really important is you’re building in an area that’s desirable for families and young people with ample amenities surrounding it.”

One big draw for families could come south of that intersection at 41st Street and Veterans Parkway, where SportGames Center is under construction.

The 22,000-square-foot indoor sports complex includes areas for basketball, baseball, volleyball and other sports along with a new location for Truks-N-Trykes Playcare.

Owner Del Waltner said business related to his SportGames LLC, which offers Sport Court flooring and other products such as as mounted basketball hoops, batting cages and scoreboards, has been so busy it has put him a bit behind on the building.

“The concentration has been to complete the Truks-N-Trykes Playcare area first and then the gyms and storage areas afterwards,” he said.

There are multiple sporting events asking to use the space in January, so the hope is to be far enough along to accommodate them.

Harr & Lemme recently moved its office to the property. Kum & Go bought an acre to the north, and there are about 5 1/2 acres remaining.

“There’s been sporadic interest, but that’s definitely changed,” said Ingle, who has it listed. “We think a great use here would be a neighborhood sports bar. You’ve got 350,000 people visiting Harmodon Park every year; that’s a win. And we had early interest from a hotel developer playing off the visitors to the park and just the east side in general.”

Article published in the Sioux Falls Business Journal
Author: Jodi Schwan