Rapid City SD – In the aerial photo the broker chose for the Star Village listing, the trees across the hillside have just started to turn gold, and the complex’s small single-story buildings are scattered across the green below. The photo is the first thing a prospective buyer sees. The pitch underneath it is written for investors, not for the people who live there.
Star Village and Aspen Park, the two Rapid City apartment complexes headed to a court-ordered bankruptcy auction, went up for sale on the commercial real estate sites LoopNet and Ten-X on Oct. 21. Both listings are run by the brokerage Colliers. Both open with a $1 starting bid. And both describe the properties the same way: as “value-add” opportunities, with rents below what the market will bear.
What ‘value-add’ means
In commercial real estate, “value-add” is an industry term for a property where a buyer expects to increase its income, usually through renovations and higher rents.
The Aspen Park listing says the complex’s “average in-place rent remains below much of the competitive set,” and describes “value-add potential supported by competitive rent positioning and identified capital needs.”
The Star Village listing uses similar language. It says the property’s average rent “remains below the upper end of the competitive set” and points to “opportunities for targeted property improvements.”
Neither listing says what a buyer would charge. But the listings are written for investors deciding how much a property is worth, and they make the case that current rents are low.
The properties, by the listings’ numbers
Aspen Park (426–434 East Fairmont Boulevard)
- 81 units in two residential buildings, built in 1977
- 98% occupied, according to the listing’s summary
- Average rent: $713 a month
- Average unit size: 581 square feet
Star Village (27 Signal Drive)
- 178 units in 89 single-story buildings, built in 1952, according to the listing’s summary
- 94% occupied
- Average rent: $843 a month
- Average unit size: 650 square feet
- Described as “less than a mile from downtown Rapid City,” in a “low-density residential setting”
Both listings also sell Rapid City itself. They tell investors that about 670 apartment units were absorbed in the past year, that vacancy fell 5.2 percentage points to 9.9%, and that “no multifamily units are currently under construction.” They name Ellsworth Air Force Base, health care, government, and education as the anchors of the local economy.
The listings don’t agree with themselves
Several basic facts differ from one part of each listing to another.
- Star Village’s address. The Star Village summary says the property is “located at 426–434 East Fairmont Boulevard.” That is Aspen Park’s address. Star Village is at 27 Signal Drive.
- Star Village’s size. The summary says 178 units on “approximately 39.28 acres.” The property facts on the same page list 182 units and a 47.33-acre lot.
- Aspen Park’s size. The summary says “approximately 3.62 acres.” The property facts list a 1.78-acre lot.
- Aspen Park’s occupancy. The summary says 98%. The property facts say 96%.
‘Absolute auction,’ with a reserve notice
Both properties are advertised as an “Absolute Auction.” In an absolute auction, the property generally sells to the highest bidder regardless of price, with no minimum.
But each listing page also shows the status “Reserve Not Met” and a notice that the auctioneer has been “authorized to place a counterbid on the seller’s behalf” and “will stop counterbidding once the seller’s reserve price has been met.” The listings don’t explain how those two descriptions fit together.
The bankruptcy court record adds one more factor. Merchants Bank of Indiana, the lender owed money on both properties, has “full credit bid rights up to its total outstanding indebtedness,” which was $79,636,621.12 when the cases were filed (Doc. 812). That means the bank can bid with the debt it is owed instead of cash, and could end up owning the properties itself if outside bids come in low.
How the sale works
Bidders must register and show proof of funds. The listings say loan quotes and financing term sheets won’t be accepted; cash, lines of credit, or accounts that can quickly be turned into cash will. Bids go up in $2,500 steps, and the winning buyer pays a 3% transaction fee, with a $20,000 minimum.
The online auctions run Nov. 30 through Dec. 2. A bankruptcy judge in Florida will hold a final hearing to approve the sales on Dec. 4 (Doc. 865).
As of early Oct. 25, the Aspen Park listing showed 7,552 views. The Star Village listing showed 7,471.
What this means for tenants
The sale does not cancel written leases. The bank’s auction motion says the properties are “occupied by residential tenants with written lease agreements” and that those leases “will not be extinguished” by the sale (Doc. 812, ¶ 26).
The confirmed bankruptcy plan preserved tenants’ rights to their security deposits and prepaid rent (Doc. 689, Art. IX).
What happens when those leases come up for renewal under a new owner is a different question, and it’s the one the listings are written to answer for investors.
The Sentinel’s guide for Star Village and Aspen Park tenants explains lease and deposit rights in detail, along with what tenants should keep on hand before the sale.
The Rapid City Sentinel will report the outcome of the auction and the identity of any buyer once the sale is approved by the court.
Sourcing
LoopNet/Ten-X auction listings by Colliers for “Aspen Park Absolute Bankruptcy Sale,” 426 & 434 E Fairmont Blvd (parcel 0036802), and “Star Village Absolute Bankruptcy Sale,” 27 Signal Dr (parcel 0031335), both listed Oct. 21, 2026, as publicly displayed Oct. 25, 2026. U.S. Bankruptcy Court for the Southern District of Florida, Lead Case No. 25-13865-MAM and member case No. 25-14655-MAM (Tzadik Rapid City Portfolio I, LLC): Third Amended Joint Chapter 11 Plan of Reorganization (Doc. 689); Auction Motion (Doc. 812); Auction Order (Doc. 833); Order Rescheduling Auctions (Doc. 865).
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