Oct. 6, 2022

A new development across from George McGovern Middle School in northwest Sioux Falls is planning 800 new single-family homes – with a manufacturing facility on the property.

The Harvest Hills development is 325 acres in the area bounded by Maple Street, Benson Road, La Mesa Drive and Valley View Road.

The former farmland was purchased by an investment group that is led by the Flandreau Santee Sioux Tribe. The Harvest Hills development is being led by managing partner Allen Gordon, whose background includes a similar smaller-scale project in Madison and two decades leading Superior Building Systems in Watertown.

“The appeal to me as I looked at the project was that it was close to schools, and it’s on the northwest side of town where there’s a lot of growing going on,” Gordon said. “I wanted to focus specifically on housing, not multifamily, and create a neighborhood atmosphere.”

Homes will be built in a hoop building that will be constructed on-site and then moved to their lot.

“They won’t be modular. They will be one big piece,” Gordon said. “It’s really unique. I’m not aware of this anywhere in the country. And I think there will be people looking at Sioux Falls as the leading edge in the homebuilding industry.”

The city is proposing to rezone the land from agriculture to a combination of residential and light industrial to reflect the manufacturing that will happen on the site. It was approved Wednesday by the Planning Commission with the condition that the industrial land be rezoned once building is done.

“We’re not concerned about how they will construct them – they’ll be meeting residential building codes – but we needed to zone that parcel as manufacturing,” urban planner Justin Bieber said. “We added a condition to say once the construction of the homes is complete that’s the only thing it can be used for, so we don’t have a future industrial use in a residential subdivision, so it’s a very interesting concept. It’ll be interesting to see how it works.”

Floor plans for the houses start at about 1,600 square feet with a basement and could include a three-stall garage and up to four bedrooms on the main level, with additional built-out on the lower level.

Homebuyers will be able to choose among floor plans and decide on their own finishes, such as flooring, cabinets and counters.

“I’m going to build three model homes right away – like good, better, best – and in each of the garages there will be samples, and they’ll be pre-set with furniture so people can look around and see the quality we build and how we’re building the homes and pick their floor plan,” Gordon said. “We’re creating a process that makes it easier for people to buy a house and get it in the right location.”

For employees, working indoors and being able to specialize on one element of the construction process is appealing, he added. Homes will be built on the property and then moved to their respective lot.

He estimates needing 60 to 80 employees.

“It’s a hoop building, so it’s set up to be able to tear down as fast as it sets up, so at the end of the project we can take it down and move it down the road or to a different state,” he said, adding he’s open to doing more projects in Sioux Falls depending on market response.

He estimates homes will start at $500,000.

“They’re going to be really nice homes,” he said. “They’ll be well-built. Homebuyers will have their own touches and can pick out what they want, and we’ll give an option for solar on the roof to plug into the garage for electric cars, so we’re going to try and be responsive to what the customers are looking for.”

The modular approach increasingly has been used nationwide for apartments and hotels. Hegg Modular, a new division of Hegg Cos., is opening a facility in Brandon designed for that type of construction.

“I’m really excited to be in Sioux Falls,” Gordon said. “This is a unique opportunity that’s coming, and I’ve had a handful of people reach out to me that I’ve known over the years that want to know how it’s coming and want to do the same in their part of the country.”

The development represents a move-up opportunity for northwest Sioux Falls, Bieber said.

“It’s nice that they’re getting some middle housing stock,” he said. “You have your first-time homebuyer, and you can stay in that area and move up.”

There will be about 19 acres remaining after the housing is built that could be used for a convenience store or some other neighborhood commercial use, Gordon said.

The plan is to start dirt work yet this year and be building by mid-2023. Working with the Flandreau Santee Sioux resulted after Gordon reached out for help with financing, he said.

“They’re very visionary and entrepreneurial and very confident in stepping out of their comfort zone,” he said. “I had debt financing in place, and I was looking for some equity help, and they said: ‘We’ll do it all. We want to be a partner.’ And that’s how they became my partner. It’s really stepping out of the box for anybody, really, but they’re the financing side, and the development and construction is all me.”

The plan is to build in phases, potentially over seven years – “if we’re kicking out a house a day,” he added.

The approach to building also results in less material going to the landfill, he added – about one dumpster versus three in a more traditional approach to construction.

If all goes well and Sioux Falls continues to demand more housing, “we’d certainly look at buying more land,” he added. “The opportunities could be endless with what we’re doing.”