For a few years, the 600 block of West 11th Street in Sioux Falls has been a project waiting to happen. Now crews are on the site, and the plan that once called for a 2025 start is finally moving.
Southeastern Directions for Life has started work on a new three-story building on the block once known as the Mercato block. That site was once home to retail businesses and apartments. Pigeon605 reported that the ground floor will house Southeastern's addiction, mental health and counseling services, which are now on South Cliff Avenue. The two upper floors will hold 55 apartments for low-income residents.
Housing above the help
The apartments will include single-resident occupancy, studio, one-bedroom and two-bedroom floor plans. Southeastern CEO Jennifer Quigley said the idea is to put housing right where people get care.
"Transportation issues can be a barrier for people to receive services," Quigley told Pigeon605. "We are hoping by providing housing close to where people receive those services, this barrier will be minimized."
Quigley said affordable housing is a major issue in Sioux Falls and that 55 more units should give more people a chance to live somewhere safe at a rent they can afford.
Lloyd Companies has been clear about its role. In a February update on its own website, the company said it is serving as consultant, development partner and general contractor on the Southeastern project. It said residents won't have to be Southeastern clients to live there but would benefit from on-site services available 24 hours a day.
Lloyd said in February that the project was supported by Low-Income Housing Tax Credits, part of nearly $4.2 million in credits the South Dakota Housing Development Authority awarded for 2025 to the company's projects.
"Tax credits are a critical element of these projects," Kellen Erpenbach, senior financial analyst at Lloyd, said in that update. "It's difficult to garner support for projects targeting low-income individuals without the dedicated programs like Low-Income Housing Tax Credits."
An early start to beat the weather
According to Pigeon605, VanDeWalle Architects designed the building. Quigley said Minnwest Bank, First Dakota National Bank and First Bank & Trust obtained the tax credits. For now, the property is owned by a limited liability company named Southeastern Behavioral Apartments. It will eventually be transferred to the nonprofit.
The schedule is tight. Construction must be finished by Dec. 31, 2027. Work began a couple of weeks before the Sept. 29 closing because Lloyd agreed to an early start.
"We're trying to beat that frozen ground," Quigley said.
The weather has already made itself felt. Frequent September rains led Southeastern to postpone a private groundbreaking ceremony.
The timeline has shifted more than once. The original hope was to start construction in 2025. In February, Lloyd said it planned to break ground this summer and finish by the end of 2027. The finish date has held even as the start slipped into fall.
Southeastern, founded 74 years ago, directly serves more than 4,000 clients a year, Quigley said. Its children and adolescent services will stay at 2000 S. Summit Ave. The agency may also move its recovery services from The Link, the Sioux Falls triage center, into the new building. Quigley said no decision will be made until The Link has a new operator.
For neighbors and trades working downtown, the project means a vacant block will be busy through next year. It will be a three-story building on a tight urban site.
Why it matters for Contractors
Projects like this one are a big piece of how affordable rental housing gets built in South Dakota. Tax credits, bank partners, a nonprofit owner and a contractor who also serves as developer all have to line up before the first footing gets poured. When they do line up, the deadline doesn't move, and the clock is already running toward Dec. 31, 2027.
For subcontractors and suppliers in the Sioux Falls area, a three-story mixed-use building with 55 apartments over a services floor means a steady run of work through next year. That includes framing, mechanical, electrical, plumbing and finish trades. Starting before the ground freezes gives the job a head start on a tight schedule. With frequent rains already pushing back the ceremonial groundbreaking, contractors who can keep crews moving through a South Dakota winter will be the ones who help this project finish on time.