DECEMBER 22, 2023:
The City of Pierre and Stencil Group have entered into an agreement to formalize the development plan for a new apartment complex in northeast Pierre.
The agreement outlines the responsibilities of both the City and Stencil as it relates to the TIF (Tax Increment Financing) that will be used for the development. Specifically, it states that the City will set aside up to $1,237,543 of the new property tax collected on the complex to help finance the project. In turn, Stencil will develop the property in a lawful and responsible way and shall bear all the financial risk.
At the request of the South Dakota Department of Revenue, the Commission also amended the previously approved TIF resolution with Stencil to indicate the primary purpose of the TIF is for housing development; the TIF previously listed the primary purpose as economic development.
In late September 2023, Stencil Group, a Sioux Falls based developer, announced plans to build a 100-plus unit apartment building just off Abbey Road. Construction is expected to begin this coming spring and take 14-16 months to complete.
Stencil Group has existing housing developments in Aberdeen, Brookings, Mitchell, and Watertown, as well as several like-sized communities in Minnesota.
The 112 units will include studio, one, and two-bedroom apartments. The complex will also include a sky lounge, theater, and workout room.
The undeveloped land’s estimated worth is $80,609; once the apartment complex is complete, the property value is estimated to increase to $21,300,000.
DECEMBER 6, 2023:
The Pierre City Commission has approved (Dec. 4, 2023) creation of a new Tax Increment Financing District for the development of an apartment complex in northeast Pierre.
A TIF is an economic development tool that allows a portion of the property tax collected within the district to be used for a limited amount of time to help finance the project.
Stencil Group, a Sioux Falls-based developer, is requesting the TIF for the 100-plus unit apartment complex they’re building off of Abbey Road, immediately southwest of City Hall. Once completed, the development is estimated to be worth over $20-million.
This TIF will end in 20 years, however estimates indicate the debt will be retired in about 12 years, allowing the school, the county and city to benefit from that property tax increase as soon as 2035. The payoff is expected to be fulfilled early because Stencil only anticipates using about $762,000 of the eligible $1.2 million TIF tax deferment.
NOVEMBER 30, 2023:
The Pierre City Commission is considering a new Tax Increment Financing District for the development of an apartment complex in northeast Pierre.
A TIF is an economic development tool that allows a portion of the property tax collected within the district to be used for a limited amount of time to help finance the project.
City Planner Emeline Hoblick says Stencil Group, a Sioux Falls-based developer, is requesting the TIF for the 100-plus unit apartment complex they’re building off of Abbey Road, immediately southwest of City Hall.
Hoblick says once completed, the development is estimated to be worth over $20-million.
This requested TIF will end in 20 years, however estimates indicate the debt will be retired in about 12 years, allowing the school, the county and city to benefit from that property tax increase as soon as 2035. The payoff is expected to be fulfilled early because Stencil only anticipates using about $762,000 of the eligible $1.2 million TIF tax deferment.
The Pierre City Commission will bring the proposal back to the commission next week (Dec. 4, 2023) for further consideration and action.
Written version:
The Pierre City Commission is considering a new Tax Increment Financing (TIF) District for the development of an apartment complex in northeast Pierre.
This fall, Stencil Group, a Sioux Falls-based developer, presented a plan to build a 100-plus unit apartment complex immediately southwest of City Hall. To make the development financially feasible, Stencil is requesting a TIF. A TIF is an economic development tool that allows a portion of the property tax collected within the district to be used for a limited amount of time to help finance the project.
Pierre’s Planning Commission has reviewed Stencil’s TIF project plan and district boundaries and recommended City Commission approval.
“The TIF plan requests a little more than $1.2 million in deferred taxes,” said Twila Hoffrogge, City Finance Director. “Per the request, the TIF sunsets in 20 years. However, estimates indicate the debt will be retired in about twelve years, allowing the school, the county, and city to benefit from that property tax increase as soon as 2035.”
The payoff is expected to be fulfilled early because Stencil only anticipates using about $762,000 of the eligible $1.2 million TIF tax deferment.
“Stencil plans to use only the TIF dollars it absolutely needs,” said Hoffrogge. “At this point, costs and other funding indicate they won’t need to utilize the full $1.2 million of eligible TIF dollars.”
Pierre Mayor Steve Harding says that the community has been asking for additional housing stock and Stencil is delivering.
“We have a private company that wants to invest in our community and has found space to build,” said Pierre Mayor Steve Harding. “This is an injection our housing stock has needed for more than a decade.”
The worth of the undeveloped land is estimated at $80,609; once the apartment complex is complete, the property value is estimated to increase to $21,300,000.
The City Commission will bring the proposal back to the commission next week for further consideration and action.
OCTOBER 26, 2023:
The Pierre City Commission has approved a resolution of support for the Stencil Group to apply for financial assistance for its $16.6 million, 100+ unit apartment complex.
Financial advisor Toby Morris says the City has used this procedure for previous developments.
The money being applied for is part of the $200 million approved by the state legislature to build housing infrastructure. Morris says South Dakota Housing is in charge of distributing the dollars.
Morris says there’s been strong interest in the infrastructure money from towns across the state.
The Stencil Group project will be located immediately southwest of Pierre City Hall, just off Abbey Road. Once completed, the new apartment complex will include studio, one and two-bedroom apartments, a sky lounge, a theater and a workout room.
Stencil Group has existing housing developments in Aberdeen, Brookings, Mitchell and Watertown, as well as in a number of like-sized communities in Minnesota.
OCTOBER 4, 2023:
The Pierre City Commission approved a plan to redefine lot boundaries for the new apartment complex planned for northeast Pierre.
The replat combines three lots into one, creating a 4.5-acre lot that will house the 4-story apartment building. As part of the replat, an undeveloped road, Augusta Street, was vacated and designated as the entrance to the new apartment building.
“The replat is an administrative step to legally redefine and record boundaries at the request of the property owner,” said Commission President Jamie Huizenga. “It also establishes locations and easements for proper utility placement.”
The plan to build a 112-unit apartment building at the site just southwest of Pierre City Hall was announced by Stencil Group, a private development firm from Sioux Falls, at the Sept. 26 City Commission meeting. The plan includes studio, one-bedroom and two-bedroom apartments, garages, and other off-street parking for those living in the apartments.
Commissioner Huizenga says this is a positive development for the community.
“We have a private developer who is buying an appropriately zoned lot, is investing in Pierre, and is helping with our depleted housing stock,” said Huizenga. “The community has been asking for additional housing for at least 15 years; this will absolutely help balance Pierre’s available housing options.”
City staff noted the combined lots have always been designated for multi-family housing.
Construction of the Stencil development, known as Abbey Road Apartments, is expected to begin yet this year. Construction should take 14-16 months.
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SEPTEMBER 27, 2023:
A new, $16.6 million, 100+ unit apartment complex is coming to the northeast part of Pierre.
At this week’s (Sept. 26, 2023) Pierre City Commission meeting, Stencil Group CEO Nate Stencil outlined the plan for the project that will be located immediately southwest of Pierre City Hall, just off Abbey Road.
Stencil said the company focuses its investments in small markets and has had its eye on Pierre for a while.
Stencil said this apartment complex would be considered workforce housing.
As part of the project, Financial advisor Toby Morris said Stencil Group is requesting a $1.2 million TIF (Tax Increment Financing) district.
Morris said the TIF district would be in effect for less than 14 years.
Once completed, the new apartment complex will include studio, one and two-bedroom apartments, a sky lounge, a theater and a workout room.
Stencil Group has existing housing developments in Aberdeen, Brookings, Mitchell and Watertown, as well as in a number of like-sized communities in Minnesota.
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SEPTEMBER 26, 2023:
Stencil Group, a Sioux Falls based developer, is bringing a large apartment complex to northeast Pierre.
At this week’s (Sept. 26, 2023) Pierre City Commission meeting, Nate Stencil, Stencil CEO, outlined the plan for a 100-plus unit apartment building that will be located immediately southwest of Pierre City Hall, just off Abbey Road. Construction of the $16.6 million project is expected to start by May 2024 and take 14-16 months to complete.
Stencil Group has existing housing developments in Aberdeen, Brookings, Mitchell and Watertown, as well as a number of like-sized communities in Minnesota. According to Stencil, the company focuses its investments in small markets and has had its eye on Pierre for a while.
“The community fits our business model well, and we’re very much looking forward to being part of Pierre,” said Stencil. “We retain ownership of almost all our properties. As a company we build in a community, and we stay in the community.”
As part of the project, the Pierre City Commission approved an MOU with Stencil Group. It identifies what the project will be, as well as Stencil’s intent to request a $1.2 million TIF (Tax Increment Financing) for the project.
Pierre Mayor Steve Harding says the development is fantastic news for Pierre.
“We have been talking about housing stock in Pierre for as long as I’ve been on the commission,” said Pierre Mayor Steve Harding. “I’m excited about this complex and the modern amenities it will provide to its renters.”
The new units will include studio, one, and two-bedroom apartments. The complex will also include a sky lounge, theater and workout room.
Image of what the new Stencil Group apartment complex in Pierre will look like when completed.
(L to R): Pierre Mayor Steve Harding and Stencil CEO Nate Stencil with image of what the apartment complex will look like when completed.
Courtesy photo.
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