Jodi’s Journal: Smithfield story sets stage for Sioux Falls’ future

It was a coincidence on the calendar — but in retrospect, an entirely symbolic setting for the biggest business story I’ve witnessed in Sioux Falls.

On Presidents Day at The Steel District in downtown Sioux Falls, our community learned of Smithfield Foods’ decision to build the industry’s most modern pork plant in northwest Sioux Falls and vacate its century-old downtown site.

As the significance of the federal holiday hit me, I thought back on how the most effective of our leaders tend to have been our presidents who have inspired the nation to believe that better days can be ahead.

“It’s morning in America.”

“I still believe in a place called Hope.”

This Presidents Day, our state, local and business leaders gave Sioux Falls and South Dakota a reason to feel that sense of possibility — and to be incredibly hopeful about our shared future. The layers to this are worth unpacking, but let’s start back at the setting — on an upper floor of The Steel District when it was still a construction site.

Sometime in 2023 or 2024, Sioux Falls officials learned Smithfield Foods was considering a major expansion and renovation to its downtown property — one that likely would cement its presence there for decades.

Mayor Paul TenHaken said he asked Erica Beck, his chief of staff at the time, to reach out to the company, which resulted in a connection with vice president of corporate affairs Jim Monroe and an invitation for the company’s leadership to visit Sioux Falls.

“I honestly had low expectations,” TenHaken told me. “I didn’t expect them to take us up on it, but they did. We kicked off the day on the fifth floor of The Steel District overlooking their plant to give them a view of the development happening downtown. Their property was really the last industrial holdout, and we were committing to helping them find a new home here. We wanted them to stay but to find a new location.”

The door had been opened — but just a crack. It was hard to make a financial case for what was anticipated to be a big gap between building new and renovating the existing plant. At one point, city leaders resigned themselves to the fact that putting in some better landscaping requirements and buffering around a larger downtown site might be the only card they held.

And then, everything started to change. As planning moved along, Smithfield’s analysis showed it was worth considering options for a new site.

Fortunately, Sioux Falls had just enough options that one worked: 200 acres in northwest Sioux Falls zoned for heavy industrial use at Foundation Park.

The people who did what it took to create Foundation Park more than a decade ago — and there are many of them — literally helped create a foundation for the business activity that will define the first half of the century for this community.

No matter how technology evolves and changes jobs and industries, this development park and the businesses located here mean that Sioux Falls is able to grow the segment of its economy where people make things. An economic base of manufacturing, food processing, agribusiness and logistics blended with health care and financial services is one that can sustain the volatility I suspect is ahead. It’s one that offers opportunities for everyone from the new American to the new college grad to the person whose industry was disrupted and is looking to learn new skills.

And just as we had the right place, we had the right people. What are the odds that the new leader of the Governor’s Office of Economic Development, Bill Even, happens to be the former CEO of the National Pork Board with strong industry relationships that helped him navigate this deal?

Alongside our state leaders, we have a team of city officials who are smart, solution-minded people who understood at every step of this process the enormity of the opportunity they were trying to capture.

And we have a community of public and private leaders who continually have recognized the importance of Smithfield to this city and state, going back to Gov. George Mickelson and the business leaders who died with him in a 1993 plane crash trying to stop what was then John Morrell & Co. from leaving town: Angus Anson of Northern States Power, David Birkeland of First Bank of South Dakota,; Roland Dolly of the Governor’s Office of Economic Development, Roger Hainje of the Sioux Falls Development Foundation, Ron Reed of the Governor’s Office of Energy Policy and state pilots Ron Becker and David Hansen.

I remember during the worst early days of the COVID-19 pandemic when Smithfield’s operations were disrupted. We immediately heard from local pork producers about how decimating it was.

Now imagine if it went away for good, which is what would have happened if everyone involved hadn’t arrived at a plan and if there hadn’t been a place ready to go to support the company’s growth. Instead, we’re going to be home to the most modern, sophisticated plant of its kind in the nation — possibly the world — and all the benefits that come along with it.

Incredibly, that’s only half the story.

Just as it was not a given that Smithfield would remain in Sioux Falls, it’s important to remember that the community certainly would not have automatically become the owner of its property — or even had the capacity to buy it.

When TenHaken approached philanthropist Denny Sanford about contributing to the opportunity, he “instantly understood the enormity of this and how huge it was,” TenHaken said. “He realized the transformational change that would happen if Smithfield moved. But he also wanted to make sure they stayed. He understood the economic impact of them to the community. So he put on his business hat.”

Sanford’s $50 million gift “was the linchpin” that sealed the deal, TenHaken said.

“Smithfield very likely in other states could have got offered free land to move,” he said. “Other states do that readily to incentive businesses, especially one that provides $3 billion in annual economic impact. We just don’t do that, so knowing we didn’t have a tool to do that, we had to do a work-around and asked Denny if he’d be willing to buy that plant.”

Just think about that: Instead of hoping that Smithfield would have sold the property to developers who would do right by our community, Sanford’s gift puts us collectively in charge of what transpires here. At 90 years old, he just made what will go down as one of his most historic, impactful contributions: He gave us the keys to decades of possibilities and put us in the driver’s seat.

I smile when I see the public speculation about what the 120 acres downtown could become because everything I’ve read is thinking too small and doesn’t recognize the scale of opportunity that awaits. This map says it all:

Many times already, I’ve found myself driving around that property considering the same thing. The truth is, it can be almost unlimited things. It’s literally like creating a second downtown — giving us the chance to build on the success we’ve already achieved at the doorstep to our city’s namesake park.

Just as downtown today is a microcosm of the broader community, The Sanford District hopefully will be the same — and serve as the catalyst for thinking even more strategically about areas including the South Dakota State Penitentiary and throughout the Whittier neighborhood. Every major decision is back on the table. Every master plan we thought we had as a community will need a new look. The world of possibilities just ignited.

TenHaken got the call from Smithfield CEO Shane Smith on a Friday afternoon in December that the deal had been approved.

“I threw my hands in the air and yelled in my office,” he said. “It was fun. It was a good day.”

Presidents Day was an awfully good day too. I hope it also serves as spark for some in our community who have thought about stepping up to help lead in the years ahead.

We’re going to need you. The years to come hold the promise of incredible opportunity, but only if those leading this state and community can harness it through casting a vision, building trust, fostering relationships and getting big ideas across the finish line.

Understandably, there will be questions about many aspects of this major announcement. I guarantee there will be obstacles no one has anticipated in the coming years because there always are. But when you look at the bottom line and the big picture, I hope you feel as excited for the future of this community as I do. We needed this. We needed that next big thing. Our next generation needed that next big thing. We got something bigger than I could have ever envisioned.

Sioux Falls made history on Presidents Day. Thank you to everyone who made it possible.

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