Whenever any of the state lands shall be valuable or desirable for townsite purposes, the commissioner may cause or permit the same to be subdivided into suitable tracts, or surveyed into lots and blocks, with the usual reservations for streets, alleys and public purposes, and shall cause appraisement of such lands to be made and prescribe rules and regulations for the use and occupancy thereof, and may lease or sell such lots, blocks and subdivisions in accordance with law.