Sioux Falls Developer Starts Largest Permitted Project of 2026, Aiming for State's Biggest Apartment Complex

Mailbox Money Real Estate has completed leasing on the first phase of its Foss Fields development and has broken ground on a second phase that carries the largest building permit issued in Sioux Falls in 2026. Once a planned third phase is complete, Foss Fields will be the largest apartment complex in South Dakota at 500 units.

The announcement came alongside a ribbon-cutting event for Foss Fields Phase One, a 100-unit property that is now fully open. The final building was released this month, and 78 of the 100 units were pre-leased before its opening.

Phase Two of Foss Fields is a 250-unit, roughly $26 to $27 million project that broke ground in June 2026. The scale of the permit, the largest issued in the city that year, reflects the size of the underlying market study behind it. Mailbox Money Real Estate commissioned a formal HUD study for the site, which found demand for more than 400 units in the immediate area, prompting the firm to move forward with the 250-unit second phase.

The project is financed through a HUD-guaranteed note, making Mailbox Money Real Estate a HUD-approved developer for the first time. Dusten Hendrickson, who leads the firm, said the designation is a meaningful step for the company but does not change how the property operates day to day.

“It’s a federal guaranteed note, but it’s a little different,” Hendrickson said. “It doesn’t tie your hands. We can still rent the units at free market pricing.”

That distinction matters. Unlike Section 8 or LIHTC-financed housing, Foss Fields’ units are not subject to government rent restrictions or income qualification limits, allowing the property to operate at true market-rate rents while still carrying federal backing.

Foss Fields sits along Veterans Highway, a secondary beltway connecting Interstate 90 to Interstate 29 on the city’s growing east side. Once construction on the corridor is complete, the intersection of Veterans Highway and East 10th Street, located half a mile from the property, is projected to become the busiest intersection in South Dakota.

The property is also zoned within the Brandon School District, ranked the top school district in the state, and sits near the Dawley Farm shopping district, which includes a movie theater, grocery stores and a range of restaurants.

Units at Foss Fields include one, two and three bedroom floor plans, with rents ranging from roughly $850 to $1,650 a month. Interiors feature quartz countertops, stainless steel appliances and large windows, with amenities concentrated inside the unit rather than in shared community spaces, a strategy the firm uses to keep rents lower.

Hendrickson said the ribbon cutting for Phase One, which included a Chamber of Commerce appearance and community open house, drew strong local interest, and the groundbreaking for Phase Two has already generated public debate in the community about the balance between housing affordability and new supply.

With Phase One fully leased and Phase Two under construction, Mailbox Money Real Estate says it will begin planning for a third and final phase that would bring Foss Fields to 500 total units.