This house sold for $3.5 million to a nonprofit. Here’s a look at what it purchased.
One of the Triangle’s most expensive mansions has sold to a nonprofit out of Greensboro.
Tech entrepreneur Richard Lee sold his 18,300-square-foot home on Alpine Creek Road in North Raleigh last week to Food Assistance, a nonprofit that helps feed low-income and homebound elderly people in Guilford County.
The house sold for $3.5 million, according to Wake County records.
It was an unusual transaction for the Triangle’s luxury real estate market, but it could possibly lead to a big pay day for Food Assistance.
That’s because the sale was conducted via an IRS Section 170 transaction, also known as a bargain sale. It’s a tax tool designed to give the seller a tax break and the buyer — which must be a charitable organization — a chance to flip the property for a profit.
In bargain sales, the owners sells a property for less than market value to a charitable organization and then gets a tax break for the difference between the sales price and the appraised value of the property. The appraised value of the Alpine Creek home is around $5.5 million, according to county records.
Lee — who made his fortune selling the tech company Hosted — bought the home for just under $3 million in 2010, according to property records.
Jane Carlson, executive director for Food Assistance, said her small nonprofit has come to rely on using bargain sales as a way raise funds.
“It really helps us since we are a small foundation and grant money is hard to get,” she said in a phone interview.
Started in 2003, Food Assistance says it helps around 450 families a month by delivering groceries to them free of charge.
Carlson worked with Welfont, a real estate firm out of Florida that her nonprofit has done several transactions with in the past.
Efforts to reach Welfont were not immediately successful. Carlson said she expects the home to fetch more than $3.5 million.
The sale represents another high-digit sale in the Triangle’s luxury home market, though the sales price conceivably could have been higher. Before the sale, the home, which sits on 15 acres near the banks of Falls Lake, had been listed for as much as $9.5 million.
But even at the lower sales price it is one of the most expensive sales in the past year, though it was still topped by another nearby north Raleigh mansion at 1624 Morning Mountain Road. That home broke the sales-price record for Wake County when it sold last year for $5.5 million.