Sioux Falls Sign a Deal to Purchase Downtown Railyard

The city of Sioux Falls plans to pay $27.3 million to BNSF Railway in exchange for about 10 acres of rail yard in the downtown area, where officials hope the deal will bolster a new phase of development.

Mayor Mike Huether said Wednesday at a news conference that the negotiations between Sioux Falls and BNSF for a portion of the company’s downtown rail system have been in the works for more than a decade.

“There certainly have been big days in the history of our great city — game-changing days,” the mayor said. “Today is one of those days.”

The deal will allow the opening up of a north-south stretch of land from the 10th Street viaduct to an area near Kilian Community College. The rail yard relocation project is even more significant than the building of the Denny Sanford Premier Center, Huether said.

The agreement is expected to spur as much as $100 million in new development, according to officials. The deal uses $40 million in federal funding secured by Sens. John Thune and Tim Johnson in 2005, the Argus Leader reported.

Brienne Miller of Downtown Sioux Falls, the nonprofit dedicated to upgrading and enhancing the city’s downtown area, called the deal “one of the most unique opportunities” for development and a “shot in the arm” for the city.

“The sky is the limit,” she said. “We see a big future for that area.”

Although it’s too soon to tell what will be established on the 10 acres, Huether said he envisions a mixed-use public square where people will be able to live, work and play.

Development is expected to begin in 2018.