Annual Bender Market Outlook reveals strong and resilient Sioux Falls market

The annual Bender Market Outlook from Bender Commercial Real Estate Services in Sioux Falls has highlighted the remarkable strength and resilience of the local commercial real estate market, even before the recent largest private investment announcement in the city’s history. Reggie Kuipers, the president of Bender, emphasized the positive outlook for Sioux Falls in 2026 due to the strong fundamentals and thriving economy in the region.

Sioux Falls has exceeded other regional metros in terms of total building activity value, with only Des Moines surpassing Sioux Falls in activity per capita. Last year’s uncertainties have been replaced by new federal legislation and trade policies, providing a clearer economic landscape. Kuipers predicts a period of confidence and potential economic growth with interest rate cuts, low inflation, and a potential GDP increase.

The addition of a new $1.3 billion pork processing plant by Smithfield Foods is expected to have a transformative effect in the long term. Despite a negligible short-term impact, the plant signifies a positive outlook for the economic landscape of Sioux Falls. Overall, 2026 is predicted to be a robust year for both the U.S. and Sioux Falls, with anticipated growth and new announcements shaping the economic activity of the city.

The land market in Sioux Falls saw the second-strongest year for unimproved land sales in the previous year, prompted by large acquisitions for future developments, showcasing resilience and investor confidence. Harrisburg led neighboring communities in land sales, driven by proactive municipal planning. The retail market experienced lowered vacancy rates, signaling strong absorption and growth-supported stability. With ongoing strategic developments and population growth, Sioux Falls expects continued resilience in its retail sector.

The office market transitioned from confusion to confidence, adapting to hybrid work models and large available spaces. Office vacancy rates are improving, especially for smaller spaces. The downtown area faces limited availability, while the suburban market has a higher vacancy rate. The industrial market in Sioux Falls saw an increase in vacancy rates, in line with the nationwide trend. Despite this, expectations for an exciting expansion year for new office spaces are high, with absorption of vacant large spaces projected.

In conclusion, the commercial real estate market in Sioux Falls is poised for growth and opportunity in 2026. With strong fundamentals, positive economic indicators, and ongoing developments, the city is expected to continue its trajectory of resilience and success in various sectors, including land, retail, office, and industrial markets. Sioux Falls remains a beacon of strength and prosperity in the regional commercial real estate landscape.