Real estate investors looked, but didn't bid during a preliminary foreclosure auction of 70 new warehouse units in Waipi'o yesterday, leaving the mortgage holder with a tentative claim on the property.

GE Business Financial Services Inc., which is owed about $35 million on a loan it provided to develop the units at Waipio Business Center, used the value of the loan to submit a credit bid of $17 million. No one offered more for the units, which are being offered in bulk.

A final sale will probably take place during a court confirmation hearing in a month or so, at which time anyone can bid against GE. The lender can match bids up to the $35 million it is owed in an attempt to be paid off in full, or it could settle for less from an investor.

It's not uncommon for investors to wait until the confirmation hearing to submit a bid in a foreclosure, though in many cases lenders assume ownership and sell the property after real estate values and demand improve.

Local partnership WIC Partners LLC built Waipio Business Center, with 99 units, two years ago for an estimated $60 million.

The complex was one of several O'ahu warehouse projects that developers rushed to build when Hawai'i's economy was hot and there was a shortage of warehouse space.

But the market turned sharply down at the end of 2008, and WIC ran into difficulty after selling just 27 of the 99 units that year for close to $22 million — an average of just under $800,000 per unit.

The developer offered deals for buyers and also made units available for lease, but didn't sell any units last year, according to property records. Industrial real estate brokers at the time said there were many interested buyers who couldn't obtain financing. Demand also shrank as businesses began downsizing.

In June, GE filed a foreclosure lawsuit, claiming WIC defaulted on its loan with an outstanding balance of about $35 million. Since then, one unit has been sold, and one is being withheld from the auction.

Local real estate industry consultant Wendell Brooks Jr., who is handling the auction, said a confirmation hearing before a Circuit Court judge could take place in three or four weeks, though it may be longer depending on the court's schedule.