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The 173-acre STAR Academy parcel contains water and sewer systems and 11 residences, a gymnasium, barn, and administrative, housing and maintenance buildings.

A second public auction has been set for a former juvenile detention near Custer after the first attempt at a sale stalled in October.

State officials will hold a public auction at 11 a.m. Jan. 4 in the Custer County Courthouse as they again attempt to find a suitor willing to pay more than $2 million for the 173-acre STAR Academy property, located 5 miles south of Custer. 

On Oct. 18, a public auction beginning at the minimum reserve bid of $2.34 million failed to attract any interest from the three registered bidders in attendance.

In an interview Monday, state School and Public Lands Commissioner Ryan Brunner said the initial bid would still need to be at least $2.34 million.

“We’ll work to sell it to any bidder who will pay minimum appraised price,” Brunner said, explaining that a third party appraised the lot and structure, which was then accepted by the state’s Board of Appraisal in August. Word of mouth and direct marketing, Brunner added, were the main forms his office were utilizing to market the property to potential suitors.

“It’s one thing to sell. It’s another to find somebody that would be a good fit for the area,” Brunner said, mentioning job creation and tax revenue generation as two benefits the sale of the property would contribute to the area.

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Though Brunner’s office handles the marketing and auction, the decision to hold another public sale came from the governor’s office. If the auction again ends without a sale, the governor’s office will make the decision to hold another auction or try another route. A commercial lease agreement, lease-purchase agreement, or a contract for deed are three other options that could be pursued if the public auction fails to result in a sale, Brunner said.

Earlier this year, the state Legislature approved a measure to sell the parcel, which includes a scenic, sprawling property with water and sewer systems, 11 residences, a gymnasium, barn, and administrative, housing and maintenance buildings totaling 168,000 square feet. Annually, it costs the state more than $500,000 to maintain the property, according to the governor’s office.

The STAR Academy closed in April 2016. 

Brunner said significant maintenance and repair work would be needed to get the building into working condition, but the cost of those improvements were accounted for in the appraisal price.

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Contact Samuel Blackstone at samuel.blackstone@rapidcityjournal.com and follow him on Twitter or Facebook @SDBlackstone.

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