by Andrew Little, Special Correspondent

While not as creepy or invasive as the technology that helped Joaquin Phoenix develop a relationship with a computer in Spike Jonze’s 2013 artificial intelligence movie “Her,” technology has become important to the commercial real estate industry.In addition to virtual deal rooms and Google maps, one great advancement for commercial real estate transactions is the online auction. In an age of information overload, the finality of a sale or purchase at auction makes it appealing for buyers and sellers.

Auctions of all sorts have been going on for ages, but a significant limitation was getting enough of a crowd to establish a fair price for the seller. Technology has made auctions a much more seller-friendly way to dispose of a property.Ten-X Commercial and, controlled by Boston-based private equity group Thomas H. Lee Partners, as well as other brokerage-based websites have reached a huge crowd of buyers. In the past few years, disposing of an asset through a live auction online platform has changed the selling game, particularly for assets that fetch less than $10 million.In the Richmond region, there have been several trades over the past few years. Two good-size assets in the region are being auctioned on the platform — one this week and the other next month:

  • An online auction for Pocono Crossing, a 180,845-square-foot retail center off Midlothian Turnpike in Chesterfield County, ends Wednesday. Anchor tenants are Burlington, a Chuck E. Cheese and a Tuesday Morning. The center has lost a few tenants over the years. It was foreclosed on in December 2016, according to information available from real estate data provider Trepp LLC; the special servicer is LNR Partners Inc., a Miami Beach-based real estate management company. The original balance of the loan was $16.7 million in July 2006, but the most recent appraised value is $12.7 million’ the starting bid for Pocono Crossing is $5 million.
  • The Turning Basin building, a 92,814-square-foot mixed-use building at 14th and Canal streets in Richmond is the other Ten-X auctioned asset. That auction is slated to be held July 23-25. The building is home to Morton’s Steakhouse and Southern Railway Taphouse. The property has had various tenant departures but most recently has leased up to a stabilized occupancy. The property was foreclosed on in April 2012, according to Trepp; the special servicer is LNR Partners.

The original loan in July 2006 was for $16.25 million; the most recent appraisal is $10.8 million. The starting bid for the Turning Basin building is $5 million.While it is likely that both of these assets will sell, that is not always the case with the Ten-X platform. The process is heavily weighted toward the seller, who can establish a minimum bid that is somewhat arbitrary.

Typically, a 10 percent deposit is required within a few days of winning the bid, and most deals need to close within 20 to 30 days. Proof of available funds to close must be established to bid, which limits the buyer’s ability to place debt on the property.Another difficulty is that the property information is provided but not necessarily represented as true and factual. And to make matters more difficult, the contract is not negotiable.But many auction bids end up exceeding broker expectations. This is particularly true for smaller deals.

John B. Levy & Co. partner and investment banker Andrew Little can be reached at