Rapid City plans 13,000 square foot mixed-use building in Central Business District

In the heart of Rapid City, a transformative project is taking shape, promising to breathe new life into the downtown area. During a recent meeting of the Legal & Finance Committee, city officials discussed the ambitious plans for a mixed-use development adjacent to the Block 5 project, which is nearing completion. This initiative, set to unfold in phases, aims to enhance the Central Business District while providing economic opportunities and community spaces.

Phase 1 of the project will feature a three-story building encompassing 13,000 square feet. Notably, this phase will include a new ice cream shop and public restrooms, catering to both residents and visitors. The first floor is designated for a taproom, expected to create 12 jobs, while the second floor will house office spaces for tenants like Property Milled and Wildflower Labs. The third floor will offer three market-rate apartments, contributing to the city's housing options.

A significant aspect of the development is the integration of over 1,800 square feet of green space, which will connect the first phase to a future five-story building planned for Phase 2. This second phase will include additional office space, market-rate apartments, and underground parking, all designed to enhance the urban landscape.

The project is backed by a Tax Increment Financing (TIF) proposal, which seeks a grant of $1.4 million to support its development. The total construction cost is projected to exceed $12.7 million. The TIF funding is crucial, as without it, the project's financial viability would be jeopardized, leading to potential cutbacks. With TIF support, the developers anticipate a modest return of just under 5%, with a net annual income projected at nearly $90,000.

City officials emphasized that this development aligns with the new TIF policy, promoting infill development that utilizes existing infrastructure and services. The project is expected to generate nearly $4 million in tax increment over its lifespan, with a conservative estimate suggesting it will pay back the TIF funding within 14 years.

As Rapid City continues to evolve, this project stands as a testament to the city's commitment to fostering economic growth and enhancing community spaces. With its strategic location and thoughtful design, it promises to be a vibrant addition to the downtown area, inviting residents and visitors alike to engage with the heart of the city.