Whole Farm Auction

What is a Whole Farm Auction?

A whole farm auction is a unique type of land auction that offers bidders the chance to purchase single tracts, multiple tracts, or the entire set of all tracts at once (called “whole farm”). Here’s how it works in simple terms:

Multiple Auctions are Happening at the Same Time

Every tract in a whole farm auction is its own separate auction, all going at the same time.  At the same time another auction is running for the combination of all the tracts, called the Whole Farm auction.  The auctioneering team will be conducting all these auctions at the same time.

Separate Auctions for Individual Tracts

• Each tract is sold separately and simultaneously with all other tracts. This means you can bid on one or more tracts with separate unique bids.
• The highest bidders are determined individually for each tract based on the total amount they offer for any combination of per-acre or flat price bidding.

Whole Farm Auction

• In addition to selling individual tracts, Whole Farm auctions also feature a whole farm auction at the same time – this is where all the separate tracts are sold together as one big package called “whole farm.”
• The highest bidder in the whole farm auction wins if their total offer is more than anyone else’s bid for the whole farm, in either per-acre or flat price bidding.

Determining the Top Bid and Winner(s)

• Throughout the auction, there will be high bidders on every tract auction and the whole farm auction. Each auction is considered separate and bidding amounts will vary.
• The Whole Farm auction high bid is compared to the sum of all the Tract auction high bids. If the Whole Farm bid is greater than all the Tract bids added up, Whole Farm is Top Bid – that means that Whole Farm is winning the overall auction.
• If the sum of all the Tract bids is more than the Whole Farm bid, then Tracts have Top Bid – that means the Tract bidders are winning.
• When the bidding stops, whomever is Top Bid will win the auction. This will be either the Whole Farm auction or all of the Tract auctions.
• Keep in mind that there can be many Tract bidders besides yourself. This means that while you may be high bid on a tract, you may not have Top Bid and will not win the auction.  But if another bidder bids up a different tract, the sum of the tract bids may exceed Whole Farm.  You then would be Top Bid for Tracts without you placing additional bids and you will win your tract auction alongside all the other Tract bidders.

After the Auction: Execution of the Purchase Agreement

Once the auction concludes, if you are Top Bid (either as Whole Farm or one or more Tracts), you will be required to execute a Purchase Agreement outlining the terms of the auction. This document outlines your responsibilities as a buyer and the terms of the sale.

Key Points to Remember

• When bidding in a whole farm auction, it’s important to consider both the value of individual tracts and the overall value of the combined plots being sold together.
• Strategic bidding is key as you need to balance your offers across multiple auctions for better chances at winning desirable land lots.
• Whole farm auctions provide a unique opportunity to acquire large parcels of land at potentially lower prices than buying them individually or in smaller packages, thanks to the combined bidding process on all tracts and the whole farm package together.