Selling the farm

On Monday the long awaited auctions of the land that SJC turned over to Farm Credit took place at the Fairgrounds. In the afternoon 14 lots east of Walmart were sold. I had never been to a land auction featuring many lots of land and was amused and amazed at how it was conducted.

First the auctioneer got bids on each of the parcels. The bids he got ranged from $2000 to $7500 and the total was $55,500. Then he asked if anyone wanted to bid on the complete set of parcels. Someone did and that bid was $62,000.  That is where I would have expected the bidding to stop, but instead that was just the start of the fun.

 Next the auctioneer invited the bidders to form any combination of lots that they wanted and give a bid. They did, and adjacent lots were combined in a single bid. There were several combinations that people suggested, and because the combination with the highest total bids would win, people were bidding not just against others interested in the lot they wanted, but against the people in other combinations. Over the course of more than an hour, various combinations competed with each other and the total bid slowly rose because bid increments were usually only $1000 (and sometimes only $500). Unfortunately I forgot my camera for this session, but I did record the results of the winning combination:
Lots 1-3: $38,000
Lots 4-5: $22,000
Lots 6-8: $32,500
Lots 9-11: $30,000
Lot 12: $14,500
Lots 13-14: $49,000
The total was $186,000.

Acreage in 1-3 is about 7.5 acres, in 4&5 about 2.3, in 6-8 3 acres, 7 & 8 about 2, 9-11 about 3.2, 12 1 acre, and 13-14 a bit less than 3 acres for a total of about 22 acres. Each of those six groups went to different bidders.

In the afternoon session there were about 30 people present. The evening auction of farm land attracted a much bigger audience. Some it is shown below and there were others behind me when I took the picture. You can see the three screens on which the current bidding would be displayed.

The structure of the auction was the same as in the morning session. First each parcel was bid and then a bid was accepted for the entire property. The bid for the whole thing was $4.7 million and it took a very long time before any combination got higher than that even though the bid increments for the farm land was $5000. The whole auction lasted about two hours.

 Here is a map of the 11 parcels that were up for bids.

 At the end of the auction, this is what the three screens looked like. The farthest screen with the orange above and next to a combination shows the winning combination.

The middle screen had a couple of combinations that did not win.

 The final screen shows the winning combination with a total of $5,165,000. Parcels 1 & 2 were sold as one lot as were parcels 8 & 11. Seven different bidders will now own the land.

One winning bidder bid over the Internet. That was bidder 201. I was surprised that the two small lots that had no farm land, lots 5 and 7, sold for the highest per-acre prices.

If you missed the auctions, you can hear them on youtube here and here. The results of the auction are on Halderman web pages here and here.