December 6, 2021
Behind the scenes and before the lottery that determined who was the first to open a medical cannabis dispensary in Sioux Falls, there was a massive search of the site.
Commercial real estate brokers spent countless hours responding to property inquiries, realizing that most deals would never go through as the city limited dispensary locations to five eligible applicants.
“For at least two consecutive months there were multiple buyers and tenants in the market looking for space and different brokers from outside the calling state,” said Raquel Blount of Lloyd Cos., Who responded to dozens, if not hundreds, of these requests. .
“Anyone who wanted to be in the business had several people trying to locate locations, so it was truly unprecedented.”
Locations cannot be 300 meters from schools or other clinics. If there is another sensitive use between 500 and 1,000 feet, such as residential development, schools, daycares, public use facilities or parks, the city may require a conditional use permit.
In some cases, other circumstances precluded submission of locations.
Among Ryan Tysdal’s announcements, those that would have qualified under city and state guidelines were excluded by “development covenants,” Van Buskirk Cos’ business broker said. “Many of the qualifying properties had additional restrictions by multiple national retailers. Any building that has an Edward Jones or tenants like this, for example, restricted any type of cannabis, so it was extremely difficult to find anything. thing.
Another hurdle for some was with existing loans on their buildings, Tysdal said.
“If it is an FDIC loan, there is usually some language that you cannot rent for illegal purposes, and in the eyes of the federal government, it is not legal, so there could be have financial implications, ”he said. “I don’t know a lot of people who want to pay off their mortgage sooner just to make a deal with the weeds.”
In the end, 79 potential locations were submitted to the city, and five were chosen by lottery to initiate the process.
Two should be on the agenda of the Planning Commission in January, requesting a conditional use permit.
One is a mall located at 3613 W. Avera Drive, which includes Starbucks, Capriotti’s Sandwich Shop, and Sweet Cheeks.
The other is located at 3215 S. Carolyn Ave. and is located in a mall known as 41st Street and I-29 Plaza. It is an old office.
The planning committee may be the only step for a conditional use permit, although the decision can be appealed to city council by the applicant or neighbors.
A third location at 2211 W. 49th St. is a shopping mall known as Golden West Plaza that is undergoing renovations.
“It was one of the few malls in existence to qualify, so (the owner) decided that maybe he should apply himself,” said Tysdal, who previously made the deal on building. “He saw an opportunity and had real estate to do it.”
The property would have also required a conditional use permit, except that city council voted to exempt churches as a sensitive use and the ordinance change takes effect this month.
“That would exclude churches in commercial areas, so if you have a church that has moved into a warehouse district or a mall, it’s difficult to block out an entire commercial area,” Kooistra said.
The last two locations initially chosen in the lottery do not need approval from the city beyond a certificate of occupancy, which is granted after authorization and inspection.
These include the only site north of Sioux Falls, a building at 1421 B Ave. which currently includes IS Restaurant Design Equipment & Supply.
The other site is currently bare land at 309 W. Anchor Lane, east of Minnesota Avenue and south of 85th Street.
“A lot of people have taken the route of getting land under contract so that they can build a building,” Blount said.
If one of the five locations doesn’t move forward for one reason or another, the next two on the list are a shopping center at Lake Lorraine and an office building at 2904 W. Russell St.
In addition to the required municipal approvals, all dispensaries must also apply for state certification.