The Iowa Economic Development Authority has approved $9.5 million from the Iowa Reinvestment Act for the Market District, giving the planned mixed-use development a boost to help move it closer to the finish line.

In approving the funds, the IEDA board today also expanded the city of Des Moines’ existing Capital City Reinvestment District by 43 acres to include the Market District, a former industrial site east of the Des Moines River and south of the East Village, bordered by East Walnut Street, East 14th Street and Scott Avenue.

The area, bisected by railroad tracks that run east and west, previously was home to a recycling center, scrap metal yard, body shops, the city’s public works yards and a MidAmerican Energy facility.

The reinvestment district previously included the Stadium District, where the proposed Pro Iowa Soccer Stadium and Global Plaza is planned, and the Western Gateway and Gray’s Landing neighborhoods, IEDA documents show.

The Des Moines City Council voted in December to ask IEDA to award additional IRA funding to the Market District. The vote followed the state agency’s announcement in September that it was opening a 90-day window for established reinvestment districts to apply for additional dollars that had become available through the Iowa Reinvestment Act program. That amount totaled $13 million, and today, the IEDA board awarded $9.5 million for the Market District and $3.5 for a reinvestment district in Fort Dodge.

The funds designated for the Market District will help fund a seven-story mixed-use boutique hotel and luxury condominium project that will feature five floors with 180 guestrooms and two floors of luxury condominiums. It will also have a full-service restaurant, retail, micro-retail and a rooftop outdoor pool, firepit and deck. Construction would begin in the second quarter of 2027, IEDA documents show.

The hotel project is estimated at $50 million.

The Market District funds were also designated for a 500-space parking ramp that would provide parking for adjacent properties and the general public. That project is valued at more than $19.3 million.

The first phase of the Market District development will include 2,500 residential units and about 30,000 square feet of retail space. The second phase would include three other lots the developers will acquire from the city at a later date, and where office space could be developed.

Earlier this month, documents from the city’s Urban Design Review Board showed a six-story, 258-unit apartment development was proposed for a vacant lot on Southeast Fourth Street in the Market District. It would be the first building to be constructed in the Market District, with construction expected to begin in late 2026 with completion by late 2028.

The Market District is being developed by JSC Properties, Rypma Properties and other partners.

“This is a tremendous opportunity for the Market District,” Tim Rypma, president of Rypma Properties, said in an email following the meeting. “We will be announcing several exciting projects later this year.”

Last fall, Rympa and Jim Cownie, founder of JSC Properties, said the Market District and the adjacent Two Rivers Park  will attract an estimated 200,000 people a year.

Overall, the Market District represents more than $600 million in investment, Rympa said.

During today’s meeting, staff told the board that the Market District award is a rebate that represents less than 20% of the hotel, motel and sales tax revenue that the development is projected to generate. Developers cannot begin receiving the credits until January 2028, staff said.

Today’s IEDA award to the Market District is in addition to the $23.5 million previously awarded to the city of Des Moines for the soccer stadium project, bringing to $33 million in IRA funding awarded to the Capital City Reinvestment District, which now includes 116 acres with the expansion approved by the IEDA board.