An innovative commitment by nine local banks and businesses means that construction may soon begin on the first of an estimated 120 low-cost family apartments in Sioux Falls.
These businesses formed a limited partnership that has established a $1 million investment pool, which is expected to generate construction by making it easier for qualified developers to borrow from local lenders. After an apartment complex is completed, the partnership will purchase the project and the developer will manage the property.
The group's goal is to build largely three-bedroom units for families that meet income guidelines and to ease the shortage of affordable family housing.
And although a record-breaking 540 single-family home building permits were issued in 1992, apartments have not kept pace with the need. The 309 permits issued for apartments in 1992 and 539 in 1991 were simply not enough, says Larry Potratz, executive director of the Sioux Falls Housing and Redevelopment Commission.
Increasing employment opportunities in Sioux Falls are partially responsible for the housing crunch, Potratz says. However, he adds that more older citizens are moving to Sioux Falls to be near quality medical services.
One of Sioux Falls' growing companies, and also one of the housing coalition's participants, is Hutchinson Technology, which has grown from about 300 employees to nearly 1,500 in five years. Other business participants are Northern States Power, Raven Industries Inc. and Starmark Inc.
"What's unique here is the non-financial institution participation," says Gene Rowenhorst, a senior vice president at Citibank South Dakota. Citibank, which will likely be the largest lender in the program, is one of five banks in the partnership; others are Western Bank, Dial Bank, First Bank of South Dakota and Marquette Bank of South Dakota.
"This is an ideal way for the corporate community to step forward—good financial business and good for the community as a whole," Potratz says.
Three developers are waiting to take advantage of the program, and at least one has passed the funding eligibility test.
—Kathy Cobb
