BROOKINGS, SD (9-3-26) — The City of Brookings and Linchpin Corp. have mutually agreed to terminate the development agreement for redevelopment of the Armory property in downtown Brookings.
Linchpin’s plans for the historic building had included event space, a restaurant and an upscale hotel.
The decision reflects the realities of today’s financing and development environment. Over the past several years, both the City and Linchpin worked diligently to pursue every reasonable opportunity to make the project viable, according to Brookings City Manager Paul Briseno.
Despite their efforts, changing market conditions, including significantly higher construction costs, rising interest rates, and a challenging lending environment for hospitality projects, prevented the project from moving forward.
“We recognize this is disappointing news for many in our community who shared our excitement for the vision of transforming the Armory into a vibrant destination,” Briseno said. “At the same time, we believe it is important to acknowledge the tremendous effort and commitment demonstrated by the Linchpin team throughout this process.”
In 2019, the City embarked on a competitive selection process for private development proposals for the City-owned Armory. Following the process, the City entered into a development agreement with the Brookings-based Linchpin in 2020.
Since then, Linchpin has invested substantial time, expertise and financial resources in the project. The team completed environmental remediation; advanced architectural and engineering work; pursued multiple financing strategies; and remained committed to the project amid changing economic conditions over the years.
“Their commitment to the Armory and to downtown Brookings never wavered,” said Mayor Oepke “Ope” Niemeyer. “They pursued every reasonable path available in an increasingly difficult development environment.”
As part of the mutual termination agreement, the City will reimburse certain project costs for due diligence, environmental remediation and other property-related work that benefited the site, regardless of future redevelopment. These investments represent work, such as mold remediation and asbestos abatement, the City would have otherwise undertaken.
Although this chapter is ending, Niemeyer said the City’s commitment to downtown Brookings remains unchanged. The work completed over the past several years has enhanced the property’s position for future opportunities.
The City will begin evaluating options after the Brookings City Council approves the mutual termination agreement at its Sept. 8 meeting.
The Brookings Armory was built at 221 Main Ave. in 1937 as a Works Progress Administration project. In 1976, the City acquired the facility from the National Guard. For several years, it was home to the Parks, Recreation and Forestry Department.
— From the City of Brookings
