City reduces price of Kelley home to $2.4 million, Mitchell mayor says 'heck of a deal'

Latest price drop marks a roughly $1 million reduction from initial listing

The Kelley Home
The price tag of the former Kelley property was recently reduced to $2.4 million, marking a roughly $1 million reduction from the initial listing.
Matt Gade / Mitchell Republic
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The former Kelley house just got a lot cheaper.

After sitting on the market for a little over a year, the multimillion-dollar house that the city of Mitchell owns has yet to attract a buyer. But Mayor Bob Everson said he’s hopeful the steep price drop to $2.4 million will get the property sold soon.

“It’s a heck of a deal,” Everson said, noting costs to construct the home hovered around $12 million.

When the city listed the three-bedroom house on the market in December 2020 through Stratton Havlik, a local realtor with Exit Realty, the price was set at $3.5 million. Since then, the city has gradually reduced the asking price, which dipped to around $2.9 million in October. The latest $2.4 million price tag marks a price drop of more than $1 million from the initial listing.

The 10,095-square-foot house came with the city’s $4.1 million purchase of 371 acres of land that sits along Firesteel Creek, which will soon be the area where the city constructs a wetland with the goal of improving the water quality of Lake Mitchell.


If the property sells, Everson said the money from the sale will be allocated to Lake Mitchell restoration efforts.

We bought it for the purpose of building the wetland to help filter out the phosphorus and sediment coming into the lake from Firesteel Creek, so all the profit from the sale will be used to keep advancing progress on improving the lake,
Everson said

The listing of the house includes about 8 acres of land surrounding the property and a large multipurpose shed that sits to the east of the home. With a retractable roof on the west side of the home and a large fish pond near the gated entrance, Everson said the property is “unlike anything on the market.”

Shown here is the front entrance of the former Kelley house that city of Mitchell purchased roughly two years ago as part of the wetland project to improve the lake water quality. (Sam Fosness / Republic)<br/>
Sam Fosness

Over the past year, the city has received some offers on the home, but Everson said those offers weren’t within the price range of the property. He noted one offer came in at a little over $1 million and requested more land to come with the purchase.

According to Everson, the house was built roughly 16 years ago near Firesteel Creek. The property sits about 2 miles west of Lake Mitchell, overlooking the creek channel where the city is inching closer to constructing a wetland to reduce phosphorus and sediment that’s known to cause Lake Mitchell’s algal blooms.

“It’s a beautiful, immaculate home in one of the prettiest areas in Mitchell. We are confident it will sell, but we are also aware the price range is high,” Everson said.

While the city purchased the 371 acres of land in 2019 from Peggy Kelley, the wife of the late Harvey Kelley, solely for the wetland project, the Kelley family stipulated the home had to come with the land.

Since purchasing the property, it’s been annexed into the city of Mitchell. In addition, the Mitchell City Council recently approved rezoning the western half of the land to an urban development district, taking it out of the previous county agriculture district.

City Planner Mark Jenniges said the zoning change established regulations that mirror the eastern half of the land that is zoned in an urban development district.


“By changing it to urban development, which is what it is abutting to, we will have some regulations on this property,” Jenniges said during the Dec. 13 Planning and Zoning Commission meeting.

Sam Fosness joined the Mitchell Republic in May 2018. He was raised in Mitchell, S.D., and graduated from Mitchell High School. He continued his education at the University of South Dakota in Vermillion, where he graduated in 2020 with a bachelor’s degree in journalism and a minor in English. During his time in college, Fosness worked as a news and sports reporter for The Volante newspaper.
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