No, not at all. The CLHbid.com platform was really designed to solve the shortcomings witnessed with the other existing platforms out there. CLHbid.com is in reality, a hybrid of three former methods, namely a) unreserved public auction, b) public tender, and c) private offer and acceptance. At unreserved auction, everything sells, regardless of price – unlike CLHbid.com where there is a floor price (‘Starting Bid’).
With public tender, there is no transparency and you restricted to submitting a single price – unlike CLHbid.com where you can increase your price in increments and you can see all other tenders as they come in.
Finally, with private offer, most neighbours find out about a sale after it has taken place, often wishing they had been able to participate – unlike CLHbid.com where a pending sale is known to all neighbours and everyone has a chance to bid and determine in the end the real value of the land on that day.
At CLHbid.com we like to say that Uber had to start someplace and just happened to start in San Francisco. Now in our 3rd year of sales, we know the CLHbid.com platform works and is scalable to any agricultural region of Western Canada. We use a National Marketing firm for all our marketing. Even though we may not have sold land in your Rural Municipality, once we take on a listing, we use a combination of 13′ signs at strategic locations near your farm, Facebook, Instagram, Internet, radio, newspaper and local mail-outs to ensure your land is marketed as it should be. We have had more than one sale where a buyer has bought land without viewing the property in person, instead merely relying on our marketing. Farmers know better than anyone that scrimping on inputs never pays off at harvest, and at CLHbid.com we treat your marketing the same for what will likely be your harvest of a lifetime.
No. To do so would run counter to the basis behind setting up the CLHbid.com format in the first place, namely to offer a specifically designed option for the selling of farm or ranch properties. Selling houses in the City or shops in an industrial park is not fraught with the same issues associated with selling that unique farm or ranch.
The goal of the team at CLHbid.com is to offer a specialized well thought out solution to Sellers of farm or ranch properties.
At CLHbid.com our intent was to design a platform to engage large players to bid, but in doing so be fair to the smaller bidder wishing to buy just one or two parcels. With that, we have set the bar high for the larger players to outbid the individual high bidders, in order to buy the entire farm or ranch. In building the CLHbid.com platform, smaller players told us they didn’t think it fair that a larger player could buy the entire farm or ranch for just a fraction above the sum of the prior individual bids, and we agreed. Hence the rationale behind the ‘premium to play’ for the En Bloc bidding. If a larger player wants the entire farm or ranch they must be willing to pay a significant sum above what all individual bidders were willing to pay in the first round of bidding.
At CLHbid.com, we only act for the Seller, and our sole goal is to maximize value for the Seller. We know from experience when dealing with multiple parcels that the ‘en bloc’ aspect can bring significant added value. At CLHbid.com, we treat all bidders equally; however, in the end, it is not our mandate to ensure every high bidder gets the parcel they wanted. Our paramount objective is to see our Seller net the highest return possible.
At CLHbid.com, we understand that retiring farmers often enjoy retaining ownership and being able to engage with the renter of their land. At CLHbid.com we respect those positive relationships between the owner and renter. A ROFR (the ability of the renter to match any offer) is not needed with CLHbid.com however, as the tenant is fully aware of the pending sale and can freely bid with the other bidders. On the contrary, if granted a ROFR tends to severely negatively affect the value the owner receives in the end. Most interested bidders don’t even apply to get financing, let alone bid, if they cannot realistically see buying the land in the end.
We have for sure received feedback. Virtually all of the feedback to date has been positive in nature. Unsuccessful bidders like that the fact that the bid was not made public. They also like the transparency knowing that for certain they were not high – as opposed to private tender where they may have been high. However someone was called to see if they wanted to match their number. Buyers have said as well that they like the transparency knowing if they are high they will get immediate electronic notice. As well Buyers have said they like the idea of knowing they only had to pay one increment above the next bidder – as opposed to private tender where they may leave a lot of money on the table by being a lot higher than required. Buyers of course also comment that they appreciated having an equal opportunity to buy in the first place.
The maximum net return to the Seller is a function of gross selling price less cost to sell. If a 2% or 3% increase in cost equates to a 25% or 40% increase in total selling price, a Seller, of course, stands to net more and, in some cases, significantly more by going with a platform that is innovation and built to maximize value. Farmers know better than anyone that seldom is a cheap decades-old tool best for a big complicated job on today’s farm.
No, we are not realtors and we are not officially affiliated with any real estate company. We are a law firm (CLH Law) and the electronic tender format of CLHbid.com is part of the CLH Law services we offer. In several countries, such as England it is very common for rural law firms to play a large role in assisting in the sale of real estate. We do strive to maintain good relations with rural realtors and have even had referrals from them. On the reverse if we get calls in relation to land that is not suitable for our format we certainly have referred clients to realtors in that area if they don’t already have a professional relationship with one.
We don’t ‘show property’ as conventional realtors do. For the most part, we leave it to our videography and still photography to showcase property up for auction. We have had several buyers actually buy without viewing the property in person. If a farm or ranch has a residence or outbuildings we have a certain time set aside for an open house. The owner is present at the open house, as they know about any improvements and can more accurately explain the property.
We only act for the seller so, if a buyer wants to make an offer in advance that is acceptable to our seller (perhaps even paying a premium to avoid public tender), we are fine selling by Private Treaty.
There are existing auction platforms out there such as the ‘Iowa Auction’ that stop bidding after all individual parcels have received high bids. Then for round #2 of the auction they allow past as well as new bidders to ‘up the ante’ by bidding on the entire farm or ranch with a reserve bid set at the aggregate price just bid on all individual parcels in round #1.
After seeking input from many farmers and ranchers, most told us they didn’t feel a platform such as this was fair to bidders on individual parcels who in many cases have went to a lot of work to get pre-approved for financing etc. Farmers and ranchers indicated they didn’t think it is fair for a large player to ‘lay in the weeds’ and not bid until after the initial round of bidding. They also told us that it would not be fair to allow a larger player to acquire the entire farm or ranch for only a few dollars more than the aggregate of the prior individual bids. Hence the rationale for the ‘premium bid’ amount for the ‘en bloc’ parcel at the conclusion of the auction.
At CLHbid.com you as bidder only need to be high on a certain number (always less than 50%) of parcels in order to have a chance to acquire the entire farm or ranch whereas at national Auction firms you generally have to be high on 100% of the parcels in order acquire the entire ranch or farm.
Bidders have no knowledge of the identity of other bidders. Likewise, the Seller during the sale is not privy to who may be bidding or how many parcels someone may be ‘high on’. At CLHbid.com we set out to create a platform for the selling or leasing of agricultural land that was honest, fully transparent and offered no opportunity for bids to be shopped by the Seller. This is especially important wherein the Seller has final approval.
At CLHbid.com we have put safeguards in place in our CLHbid.com contract with our Seller to ensure the Seller deals only with the high bidder at the conclusion of bidding. During the timed auction, itself all back-end information is locked down including who is bidding or who is registered to bid. At the conclusion of the bidding the Seller is privy only to the names of the high bidders on each parcel.
The minimum increment for bidding is set prior to each specific auction in consultation with the Seller. The increments are set having regard to the FMV of the parcel being sold with more expensive parcels generally having larger increments. You can bid in increments larger than the minimum increment if you wish but not less than the minimum.
We have all been to live auctions where a quarter of land worth $500,000.00 starts at $100,000.00. The parcel is then bid up in large increments initially with the increments gradually decreasing in size as the bidding approaches the end. At CLHbid.com given our predetermined minimum increments we try and speed up the process by starting the bidding at what we see as a reasonable number to start serious bidding at, yet a number still below FMV.
In addition, given the ‘en bloc’ final parcel bidding option offered at CLHbid.com we require a floor number for each individual parcel in the unlikely event a specific parcel doesn’t receive a bid, yet at the conclusion an eligible bidder wishes to bid on the entire farm or ranch. In such case the Starting Bid becomes the value to be used for that Parcel not receiving a bid when determining aggregate bids. It is important to note the Starting Bid is not a Reserve Bid.
This is really no different than in the tendering process wherein Tenders stipulate “any and all tenders will not necessarily be accepted”. One issue with tendering is the cost to put a tender in the paper is nominal and there is always a risk of the Seller perhaps just feeling out the market or wanting to know the names of the parties interested.
At CLHbid.com one of the paramount reasons for allowing the Seller final say is to alleviate the need for an expensive Guarantee to the auction house – expensive and seldom called upon yet often required by the Sellers bank. The Seller’s bank doesn’t require the Seller to purchase a Guarantee when using the CLHbid.com platform wherein the sale is at the Sellers discretion.
At CLHbid.com a Seller is under contract and incurs significant marketing costs in the event the Seller fails to accept the high bid(s). In addition, the contract references trigger values indicating when the right of the Seller to refuse a sale is taken away by CLHbid.com.
At CLHbid.com, our Sellers are fully invested in the process meaning the likelihood of a high bid not being accepted is extremely remote.
No. At CLHbid.com there is no advantage to waiting to bid. Our platform has a ‘refresh’ function on the clock such that any bid placed near the expiration of the timed auction will automatically re-set the clock adding additional minutes to the clock giving all parties (including the bidder that was just outbid) another opportunity to bid.
At CLHbid.com we take the human element out of the process. During the bidding process if you are high, you will receive an immediate email saying you are ON, if you get outbid you will receive an email saying you were OUTBID and immediately upon expiration of the timed auction the high bidder will receive an email indicating they were the HIGHEST BIDDER.
All emails are all auto generated. The question cannot arise as to whether you were high or not but “was it shopped to someone they liked better” such as when tendering land.
No. The Starting Bid is just that. The first bid required for a Parcel is the Starting Bid and not some number above it. If you are the initial bidder and just bid the basic minimum increment your Current Bid will be the Starting Bid number.
CLHbid doesn’t publish the name of the high bidder. We do however disclose the name of the high bidder to the owner as they are then in a contractual agreement to buy and sell. We leave it up to the high bidder and owner to tell whomever they wish.