In this type of sale, a single large property, such as a farm or subdivision, is divided into a variety of tracts, parcels and lots. Buyers can bid on any one of the units, all of them, or various combinations of them. This technique is also used to auction off estate or business properties that include both real estate and personal property. For example, in a restaurant sale, the property can be divided into various separate items, such as the building, the equipment, the furnishings and the franchise license, and bidders can bid on the separate items or various combinations of them. Those who cannot afford the whole property and otherwise would not attend, but who are interested in certain parcels or items, will come to bid on those specific pieces.
Bidding is more flexible.
In the restaurant example, someone who only wants the franchise license could bid solely on that. On the other hand, someone who cannot afford the restaurant and license can bid only on the building and equipment. The number and price of bids increases. When buyers can bid on different combinations of items more of them place a bid. This tends to increase excitement and competition, and drives up the price, as buyers see that others consider the property valuable.