Rapid City Eyes Revival: Ground Breaks on Ex-Albertsons Redevelopment

RAPID CITY, S.D. — Construction crews have begun transforming the former Albertsons site at 855 Omaha Street, a 45,000-square-foot building empty since 2017 after stints as a Family Thrift Center. Local developer Dream Design International, with deep Black Hills roots, is leading the mixed-use redevelopment at the high-traffic intersection of Omaha Street and Mount Rushmore Road. The project has secured letters of intent or leases from four national brands: a grocery store, two food-service spots and a retail outlet, with negotiations ongoing for two fitness-focused businesses.

Work kicked off with the removal of about 30 feet of exterior walls on the east, south and west sides to improve access and modernize the 1960s-era structure; the north wall facing Omaha Street remains intact. Demolition is slated to finish by November 2025, paving the way for tenant build-outs and potential openings in late 2025 or early 2026. Dream Design plans to release architectural renderings and site signage by late summer 2025, revealing specific tenants.

This effort complements broader downtown momentum, including Lloyd Cos.' Block 5 project along St. Joseph Street, which wrapped construction in May 2025. That 10-story development, selected by Elevate Rapid City, features 117 Hyatt Place hotel rooms, 132 luxury lofts across six floors and ground-floor retail like Toastique, Overland Sheepskin Co. and Melanie’s Optical Boutique. Block 5 Lofts opened to residents in mid-June 2025, marking Rapid City's first downtown residential units and boosting the area's 1,800 residents and 4,700 employees.

Local leaders view the Albertsons redo as a catalyst for Rapid City's commercial landscape, drawing community input to fill a prominent void. As the Black Hills gateway thrives, these projects underscore South Dakota's push to revitalize urban cores amid rising tourism and business demand.