Through midyear, Journey Group details strong construction year, strategic focus

This article was originally published by Jodi Schwan of SiouxFalls.Business.

Major multiyear construction projects drove significant activity at Journey Group for the first half of 2025 while other work could get started yet this year.

“We were really fortunate that we ended 2024 with a very solid backlog that carried us into 2025,” Journey Group president and CEO Randy Knecht said. “So even with a potential slowdown, we were still in pretty good shape coming into the year.”

Journey Construction’s work is visible in every corner of Sioux Falls, including in the center of the city where a major expansion is underway for women and children’s services at Avera McKennan.

“That project is going strong with all the structural steel up,” Knecht said. “We’re working on the concrete decks and will follow with interior framing.”

Avera’s other large construction project at 69th Street and Louise Avenue – a new home for gastroenterology services – “is really going well too,” he added.

“All the precast is on, and we’re working around the building with glazing and glass, and also working on the inside where a lot of walls are going up and some casework is being installed.”

Another large project, Dakota State University’s Applied Research building in northwest Sioux Falls, “is about half done,” Knecht said. “Glass and glazing will be done soon to give it a really interesting look, kind of a sawtooth look with metal panels on the exterior, so as you’re driving down the interstate, it’s going to be an interesting and beautiful addition to the landscape.”

The building is planned for substantial completion in June of next year.

A new expansion for Silencer Central also is about 50 percent to 60 percent complete. The business is adding a 60,000-square-foot warehouse and distribution center at its Sioux Falls headquarters.

“That project also is going really well and definitely changes the look of their facility with a large addition,” Knecht said.

Other large projects just getting underway include the SDSU Metro Center at 33rd Street and Minnesota Avenue, “which is a substantial renovation and will really make that corner pop with blue and gold SDSU colors,” and a major expansion to Central Church.

Outside of Sioux Falls, Journey Construction is working on everything from an expansion of Showplace Wood Products in Harrisburg to a complete phased demolition and rebuild of Sacred Heart Monastery in Yankton and a new distributorship for John Deere dealer Kibble Equipment in Huron.

“We also continue to support Avera’s needs throughout its footprint, including work on the Avera Fox Run Health Center campus in Yankton,” Knecht said.

“There are additional projects sitting on the sideline as well, whether it’s waiting for clarity around tariffs or anticipating a potential interest rate drop. I think if that happens, things will loosen up some, especially with some of the development projects we anticipate getting underway once conditions support it.”

Journey’s SFC Civil Constructors and Black-Top Paving divisions “are going strong now,” he added.

“The last few years have provided a lot of federal funding for infrastructure, although some of it is getting cut back on major projects, which could impact work we’d be interested in pursuing.”

On the civil side, Journey is working on a large project for the city of Sioux Falls – its Basin 15 lift station – “which will keep us busy through winter,” Knecht said. “And if funding for bridge work and other projects does get reduced, we’re starting to look just outside of South Dakota in surrounding states for additional work potentially in 2026.”

Black-Top Paving continues to grow market share, with major projects such as infrastructure work for Boyce Park development park in northwest Sioux Falls and the parking lot for the massive CJ Schwan’s Asian food production facility at Foundation Park.

“They also have some city overlay projects, so they are quite busy right now,” Knecht said. “If the weather can hold and we have a nice fall, I’m confident we’ll meet our overall goals for the year. But fall weather can be the difference between what makes a good year and a great year.”

Journey’s 1J Homes custom residential construction business is succeeding in growing Sioux Falls market share despite the headwinds of interest rates, Knecht said.

“Jamison Mutschelknaus, the president of 1J Homes, has done a great job continuing to add to his backlog,” he said.

“He really does a good job working with homeowners to create a vision for their custom projects and helping them move forward, so despite the tough environment, he continues to add work and growth for the 1J brand.”

Data-driven strategy

Going forward, Journey Group is focused on executing its new three-year strategic plan, which focuses on uniting its people, advancing customer understanding and using a data-driven approach to business development.

“We want to ensure we’re in the right markets and that we’re aware of emerging markets,” Knecht said. “For instance, we’ve identified water and wastewater infrastructure as a growth sector, so we’re working on opportunities to serve that niche. We also see manufacturing as a growth opportunity as that industry could be set to expand more domestically.”

Journey’s strategic plan also calls for optimizing its business model, looking at the organization from a broader enterprise perspective.

“We’ve been successful taking on new business units, but we also have become somewhat fragmented,” Knecht explained. “So we’re looking at how to move forward as ‘One Journey.’”

Part of that included a recent sale of Spearfish-based Ainsworth-Benning Construction, which Journey acquired in 2016, to Hartford-based ANCO Holdings, which also has an office in Piedmont.

“I think Ainsworth-Benning is better served with that ownership, and it’s a win-win because it allows us to go forward in market segments and geographies that fit us better,” Knecht said.

Additionally, MBW Construction & Engineering, which Journey acquired in 2021, has been fully integrated to operate as part of the Journey Construction division.

While the business unit specialized in projects for meat and poultry facilities, that segment of the business hasn’t seen its historic level of capital investment from major industry players.

“Their backlog was at a low point, so the time was right to more fully fold MBW into Journey as we see the industrial side of the business as a big growth opportunity, as well as food and beverage more broadly,” Knecht said.

“Operating under the Journey name also will help them compete more for opportunities because they were viewed as a smaller company of about 25 people even though they were part of the larger Journey organization.”

While the next six months to a year “might be a little bumpy” for Journey Group and industrywide, the big picture is promising, he said.

“We’ve seen significant growth over the last few years, so a little slower growth for a period of time will allow us to build our own infrastructure to accommodate the growth and allow us to better scale in the years to come, Knecht said.