Railyard Flats gets nod from Sioux Falls City Council, land sale approved

A new downtown Sioux Falls development can move forward after city officials earlier this week sold off a segment of the old rail yard.

Railyard Flats, from the same people behind the skyline-altering Cherapa Place, will bring apartments, retail and office space to a lot near Eighth Street and Weber Avenue where trains once moved through downtown Sioux Falls.

The City Council agreed Tuesday to sell the land to Railyard Flats LLC, the limited liability corporation behind the estimated $14 million project.

“We like the fact it’s going east and continues to push into the Whittier neighborhood,” Sioux Falls planning director Jeff Eckhoff said in his Tuesday presentation to Council.

City councilors approved the plan with an 8-0 vote, also unanimously approving a purchase agreement for land to be used for the long-planned Cherapa II project. The first Cherapa building was pivotal in revitalizing the area between downtown and Falls Park, built on the former site of the Zip Feed Mill.

The two parcels together total more than four acres, including land stretching north from Eighth Street all the way to Sixth Street.

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Combined the land was valued at $3.44 million. Developers agreed to pay $10,000 for the right to eventually purchase the other half, located behind the Cherapa building, plus $678,700 for the southern parcel where Railyard Flats will go.

"We're approaching 15 years of our time on that property and we have spent a lot of time looking at that rail yard, waiting for something to happen," said developer Anne Haber, partner with Pendar Properties. "And it finally did."

Railyard Flats would be a three-story mixed-use building with 42 apartments and 7,500 square feet of office and retail.

The building is set to open in the spring or summer of 2021.

Haber said the project will also include underground parking. Designs for the Railyard Flats project call for using a cross-laminated timber material known for its strength and quality. It's something that's never been done here locally and will add a uniqueness to the building's lodgings, Haber said.

"Our goal in this is to not make it feel like the typical white box apartment," Haber said.

The City of Sioux Falls would retain a strip along the east side of the development, eventually reserved for an extension of the bike trail and a berm.

Under a development agreement signed with the city, developers would be required to begin construction on Railyard Flats by June, Eckhoff said.

Haber said it will be much earlier and expects construction to begin as soon as the ground thaws in the spring as developers look forward to joining the growing East Bank district of downtown.

“We're really excited to be a part of that and fill in that last piece on the east side of the railroad tracks," Haber said.