Business deals multiply on Minnesota Avenue as city considers future possibilities

Dec. 17, 2020

Before the end of 2020, Kim Ueng hopes to be serving doughnuts to Sioux Falls diners.

Ueng and his partners plan to open Mr. Donuts between Christmas and New Year’s Eve.

But those traveling Minnesota Avenue likely already have noticed something has changed. Mr. Donuts is remodeling the former Taco John’s building on the southeast corner of 19th Street and Minnesota Avenue, giving it a brightly covered makeover.

“I know that this is probably the heart of Sioux Falls,” Ueng said, noting that it’s a frequently traveled route for many workers and will be an easy stop for people driving downtown to work.

“We definitely need something that is convenient and fast for people, and that’s why we put it there,” said Ueng, whose relatives have 25 Mr. Donuts shops in Oklahoma and Texas.

The shop will open early in the morning, featuring a variety of doughnuts, other baked goods and Vietnamese coffee. For lunch, it will serve sandwiches on croissants, bagels and doughnuts, and bubble tea.

“It’s going to be very convenient for people, especially in the winter. They don’t have to get out of their car to get coffee and a doughnut,” Ueng said.

Mr. Donuts could be the first of many changing uses along Minnesota Avenue.

The city has identified the highly traveled north-south road for a corridor study beginning in early 2021.

“Our intent is to start reaching out and taking public input in January,” said Jeff Eckhoff, the city’s director of planning and development services.

“Particularly what kind of uses they would like to see, particularly from the neighborhood, what they think about what transitions look like and what types of things businesses or developers will like to see happen – any kind of comments on what could be and also expose what people are worried about, so we have that input.”

The city considers Minnesota Avenue an urban streetcar commercial corridor, a designation that harkens back to an area where streetcars operated from 1906 to 1929. They created a need for commercial activity to be situated close to sidewalks and streets, where people were getting on or off the streetcars.

In the case of Minnesota Avenue, that led to an area with higher-density, mixed-use buildings, accommodating retail, offices, apartments and some houses.

“We’ve got lots of lots on Minnesota Avenue that are smaller because that’s how they evolved over the years,” Eckhoff said. “And for that to stay relevant or modernize, people are going to have to assemble land in a different way, maybe something deeper or wider than it is, and we’ll have to take a look at access and how that lines up. So we need to provide some coordinated guidelines so developers and landowners and neighbors can figure out what could happen and adjust accordingly.”

Northern gateway

One of the first major improvements likely will be to the road itself. The city is scheduled to reconstruct and modernize North Minnesota Avenue from Bennett to Second streets in 2022. The plan is to continue south of that in future years as funds are available.

The planning department’s corridor study will go in phases too, beginning with Russell Street to downtown.

“Especially on the east side, it’s better for commercial long term, but you get into the neighborhoods pretty fast, so how do you buffer and transition,” Eckhoff said. “But certainly what would be a better use and the great opportunity on Minnesota is to assemble properties because you can do something a lot more productive.”

The city also is discussing how to create a more appealing gateway for those traveling south from Russell, including incoming visitors from the Sioux Falls Regional Airport.

“We’ve had those discussions,” Eckhoff said. “There will be much better streetscaping for that exact reason. It is an entryway into town, and we really need to make that look more inviting and more like what Sioux Falls really is.”

There already is some redevelopment ahead for the northern portion of Minnesota Avenue.

A local family has purchased the former Whiffer’s Sandwiches building at 1133 N. Minnesota Ave. and is determining a concept for it, said Alex Soundy of Bender Commercial Real Estate Services, who had the property listed.

“They more saw it as an opportunity to get commercially zoned property on Minnesota Avenue for a reasonable price and then to fix it up and find an opportunity for it,” he said.

“The last six months we’ve seen a lot of ‘for sale’ signs turn to ‘sale pending’ signs on Minnesota Avenue, which is very promising.”

One of those is at a longtime restaurant building at the northeast corner of 10th Street and Minnesota Avenue, which most recently was a Marlin’s Family Restaurant.

It was purchased by a dental office this fall.

“I did have interest in it and showed it several times,” said Scott Blount of Lloyd Cos., who brokered the deal. “I think it’s a great location for a dental clinic and a nice change on that property. They’re extremely visible and can service a need for downtown. With the amount of people moving downtown, having a dental clinic right downtown is a strategic thing.”

The intersection of 14th Street and Minnesota Avenue also has transformed in the past year as the new headquarters for First Premier Bank on the northeast corner is on track for an early 2021 move-in.

The current Premier building on the southwest corner is on the market, and “we’ve had a number of lookers,” said Michael Bender of Bender Commercial, who has it listed. “It’s big, 17,000 square feet, and it’s really two different buildings connected. The lobby is about 6,000 and a two-story building next to it with a basement. We’ve had a CPA firm take a good look at it.”

Traction on the property is more likely once the bank moves out, and it could become a redevelopment, he added.

Just to the south of there, Bender also has the former Wendy’s co-listed.

“We’ve had a bank look at it, and we’ve had multiple small independent restaurants look at it pretty hard,” he said. “The owner really wants to sell it and not lease it, so we’ve turned those down.”

Core opportunities

The heart of redevelopment opportunity along the corridor likely is between 14th and 41st streets, where the right user could renovate existing space or rebuild.

That has its challenges, though.

“Until you really get depth of site big enough, your setbacks are today’s codes, which are such that you really can’t redevelop anything up and down Minnesota Avenue without taking out an entire half-block behind you of residential,” Bender said. “Until someone is willing to say that’s how you clean up that corridor, I don’t think you’re going to see much happening because it’s going to require depth.”

For now, retailers are attracted by the comparatively affordable rents offered along the corridor, he said.

For Sam Assam of Assam Commercial Real Estate, who represents several properties between 14th and 33rd streets, interest has surfaced for many of the available spaces.

“I love that corridor, and I love the location between two of our city’s biggest employers, the hospitals, and it’s easy to get to from either one of those,” he said.

Kevin Frankman, who owns multiple properties along the corridor, fixed up a strip mall at 20th Street next to Domino’s Pizza earlier this year.

“We show it weekly,” Assam said. “It’s just getting qualified tenants who aren’t going to be a revolving door.”

Bigfredo International Market opened earlier this fall in the space next to Domino’s.

Owner Fred Youboty has dreamed of owning a business since he was a kid, and he saw an opportunity to bring African ingredients to the Sioux Falls market.

The shop caters to people in Sioux Falls who have immigrated from Africa, and Youboty sells ingredients common to African cuisine, including palm nut cream concentrate, along with frozen meats and vegetables, and large bags of white rice.

Youboty moved from Liberia to Sioux Falls after getting a visa through the Electronic Diversity Visa lottery in January 2016.

Opening during the pandemic has been tough, he said. But he’s hopeful for the future.

“Maybe next year, it’s going to be good,” he said.

There’s remaining space for other businesses to become his neighbors – about 2,000 square feet each.

“It’s probably some of the best-looking space on Minnesota Avenue,” Assam said. “Kevin did a nice job fixing it up.”

Frankman also recently purchased the building at 2621 S. Minnesota that has been both Fit My Feet Orthotics & Shoes and Norman’s Men’s Wear.

“He owns quite a bit of commercial real estate up and down the Minnesota Avenue corridor, and he thought that was a strategic location in a building that was a good value,” Blount said, adding the space likely will remain retail.

“He’s looking forward to leasing it out.”

Longer term, the longtime Southway Center between 29th and 31st streets presents an opportunity for demolition and redevelopment, Bender said.

It could become a three- or four-story mixed-use building with retail on the ground floor “because it’s a big-enough site to do it and do underground parking,” he said.

The newest tenant in the Southway Center is Fine Line Designs, a home decor and apparel business that grew out of hobbies for Danielle Bolden and her husband, Lamarquis.

Bolden started turning old pallets into wooden signs with motivational sayings for family and friends, and they “became something people wanted to buy.” Next, she and Lamarquis started making old wooden spool clocks, and he began using his woodworking skills to create furniture pieces.

Most of their work is custom-made, but their shop has pieces customers can buy on the spot.

They also expanded Fine Line Designs into custom apparel and bought equipment for the store to do direct-to-garment printing, which will allow them to create designs with more colors.

“I’ve always had a dream to have my own store,” Bolden said. “We were able to save up enough money to get into our store. We’ll try it out and see how it goes.”

They plan to keep their full-time jobs, so the shop is starting with limited hours of 2 to 9 p.m. Thursday and Friday, noon to 9 p.m. Saturday and 1 to 5 p.m. Sunday.

The Boldens are a good example of the sort of business owners who are a good fit for existing Minnesota Avenue space, brokers involved in the area said.

“I would say that it’s become a great starter incubator,” said Reggie Kuipers of Bender Commercial. “You have cheap space and a lot of visibility. You get a lot of traffic rolling in there every day, and it cuts the city directly in half, east and west.”

He recently did a deal for an office building at 2600 S. Minnesota Ave. for the relocation of a child care center.

“We had a lot of different corporate office uses look at it, but a day care is cool, and I think they plan to use some component as office,” he said.

Another pivotal moment for the corridor also could be eventual redevelopment from Sanford Health, which owns a number of properties between 18th and 22nd streets.

Silverstar Car Wash also will bring a modern change to the landscape when it takes over the former Vern Eide Motorcars dealership between 23rd and 25th streets.

“It’s still a good place if you’re a small business that wants to get a start,” Kuipers said. “There are success stories from startups – Bagel Boy, Fit My Feet. Minnesota Avenue gets you eyeballs, traffic and cheap rent. That’s what I feel like Minnesota is. There are outliers with some redevelopment in there, but it’s a tough little stretch.”

Want to stay in the know?

Get our free business news delivered to your inbox.

Business deals multiply on Minnesota Avenue as city considers future possibilities

“The last six months we’ve seen a lot of ‘for sale’ signs turn to ‘sale pending’ signs on Minnesota Avenue.” And that could be just the start, as the city has identified Minnesota Avenue for a study that could lead to redevelopment.

News Tip

Have a business news item to share with us?

Scroll to top