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Sunday, May 19, 2024
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SSA Blog

©2024 by the Self Storage Association (SSA). SSA and SSA Magazine are trademarks of the Self Storage Association, Inc. Opinions expressed by authors and other contributors do not necessarily reflect those of the SSA, publisher or editors, nor do they represent the policy or positions of the SSA. Information contained within articles should not be construed as the primary basis for legal or investment decisions.

27

Should You be Doing Online Auctions?

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Should You be Doing Online Auctions?

It is certainly something to think about if you are not doing your auctions online. The primary value of online auctions is flexibility. Just consider the all-important issue of inventory control. When a space becomes delinquent, an auction may typically be held 60 to 70 days after rent was last paid. However, a facility cannot hold a live auction for a single space. They may have to hold a space for one or two months beyond the legal sell-by date before they have at least four or five spaces to offer to an audience of in-person bidders. This slows the process of putting non-revenue-generating spaces back into inventory. When facilities have low vacancy rates, this auction schedule delay can cost the facility significant revenue.

Online auctions do not require that you have several delinquent spaces to offer at the lien sale. Bidders do not drive to the facility to bid; they can submit bids on attractive spaces from their homes. The bidders don’t care if a particular facility is offering one space or a dozen. If the space looks good, they can bid on it and pick up the contents if they are the high bidder. Online auctions allow the facility owner to determine the auction schedule for each delinquent space, not an artificial date. No longer do they have to hold delinquent spaces so that there are enough spaces on offer to attract bidders to the sale.

The Self Storage Legal Network recently spoke to an operator who could not auction a significantly delinquent space for two months because the space missed the in-person auction date by just two days. This space will not generate income for another two months, and the contents will likely sell for a fraction of what is owed. Online lien sales are more efficient than in-person sales, especially for small facilities in rural locations that may have three or four in-person lien sales each year.

 

 

 

| Categories: | Tags: Legal, Online Auctions, Lien Laws, Default | View Count: (1981) | Return
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