Does it ever feel like online auctions have their own language? From absolute auctions to valuations, here are some of the most important terms and phrases to understand as you participate in an online CRE auction.

General Auction ABCs

Though the auction space has evolved along with modern technology, we still use quite a few words and phrases from the days of traditional auctions. Here are some of the most common terms you’ll see.

Absolute Auction

You might also see this referred to as an “auction without reserve”. This is an auction wherein the property is sold to the highest qualified bidder, with no reserve or other conditions on amount.

Bid

The driving force of every auction! A bid is a prospective buyer’s offer of a price that they would be willing to pay to purchase a property. 

Bid Increment

This is the amount by which the bid is raised by each bidder.

Buyer

Also referred to as the winning bidder, this is the person or entity placing the winning bid in an auction in order to purchase an property from the seller.

Reserve

Also sometimes known as the reserve price, this is the minimum undisclosed sale price set before the auction by the seller. 

Seller

The person or entity with legal possession of the property being sold at the auction. Not to be confused with the auctioneer or auction platform that facilitates the sale of assets in the auction.

Ten-X Terms

Our online auctions will have a few additional terms.

BID Limit

The highest value at which you can place a bid. On Ten-X, you will hit your bid limit once you’ve placed a bid 10% above your approved Proof of Funds amount. You can increase this limit by uploading additional proof of funds or by using Stripe.

Closing 

This happens after the auction has ended. Upon a dually executed contract and EMD received, the Ten-X closing team helps facilitates the close working directly with the assigned escrow officer and parties. For more information on this process, check out our after-auction guide.

Custom Bid

This is a bid in which the bidder enters their own customized bid instead of the current bid increment value.

Data Room

This is where you can find the due diligence documents for each of our properties. You can access this on the property’s Listing Detail Page (LDP) by clicking the blue button labeled “Data Room Documents”. You might also hear this referred to as the Data Vault.

DD

Stands for “Due Diligence”. This encompasses all of the documentation available for each property. It includes, but is not limited to:

• Financials
• Operating documents
• Property Condition Reports or PHASE I (if applicable) 
• Property visuals
• Purchase and Sale Agreement (PSA)

LDP

Short for Listing Detail Page, this is the webpage that Ten-X creates to promote and market each property. It will include:

• Photos
• Drones
• 3D tour
• Due diligence documents

MA

Short for Marketing Agreement. This represents the agreement Ten-X has with the seller to offer the property for sale. 

Marketing Center

This is our centralized dashboard where brokers and sellers can access all of their listings and track their assets’ performance before the auction.

Next Bid Meets Reserve

If the next bid will meet the reserve approved by the seller, approved bidders will be notified. 

POF

This is your “Proof of Funds”, which demonstrate a bidder’s ability to purchase assets being offered for sale. They are required to participate in a Ten-X auction and are also used to set each buyer’s bid limit. The most convenient way for bidders to submit Proof of Funds is to use Stripe during registration on the website. 

PSA

Short for “Purchase and Sale Agreement”, this is the contract that you sign when you purchase a property on Ten-X. 

Reserve Met

This means that the bidding has reached the reserve price set by the seller. 

Seller Bid

Ten-X on occasion may place a bid rejecting a bidder’s offer if the seller cannot accept the amount. Ten-X legally protects the seller's undisclosed reserve. 

Stripe

Stripe is a payment processing and financial solutions provider that allows Ten-X bidders to securely link a bank account as their proof of funds, allowing for instantaneous approval and real-time updates.

You can read more about Stripe here.

Did we miss anything?

We’ll be updating this post as we continue to evolve our product.  Check back regularly to stay informed on the latest in auction vocabulary.