An exciting new development in the world of The Foundation for Enhancing Communities (TFEC) is the recent creation and development of TFEC Properties, Inc., a new corporation. This new entity will allow TFEC to receive, hold, manage, lease and otherwise process real estate gifts from donors to benefit nonprofit organizations. Policies and guidelines have now been adopted and confirmed by the TFEC Board of Directors that allow TFEC Properties, Inc. to actively pursue and receive real estate in a way that has never been available previously to donors. As the Baby Boomer generation ages, the opportunities for sizeable charitable gifts are tremendous simply due to the fact that most developed real estate, such as homes, second homes and/or investment real estate, has a value over $100,000.
In accordance with the new guidelines, TFEC Properties, Inc. can handle charitable gifts of real estate and can even consider accepting part sale/part gift transactions, such as real estate with a small mortgage still to be paid. TFEC Properties, Inc. can also receive real estate in various arrangements like gift unitrusts, which address the ongoing interests and income needs of the donor in their lifetime to make the charitable gift now and in the future. In many cases, this can help the donor dramatically by avoiding income taxes on the gain on their real estate, which in many cases of investment property is depreciated real estate, creating a win-win for both the nonprofit organization and the donor. In addition to appreciation and value, many forms of real estate are held in arrangements that generate significate positive income, such as leases, mineral rights and the like, all of which can create a benefit for the donor as well as for the charitable recipients. This new entity will allow these win-win situations for real estate, which often had to be declined or set aside in other special arrangements in the past. TFEC Properties, Inc. can now make these opportunities available for donors to benefit the community and achieve their charitable goals.
Another important area of development in this regard, TFEC Properties, Inc. can now arrange for real estate and provide management of real estate for the benefit of other nonprofit organizations. Not only would this group be able to handle real estate transactions relating to the TFEC funds, but it could also be the holding entity for donations to benefit other qualified nonprofit organizations. Real estate takes time, expertise and presents risks and liquidity issues, all of which make it a more difficult asset for some to manage properly. Many nonprofit organizations are not able to provide adequate management of real property as a donated asset, especially when there are only one or two such donations over a long period of time. However, TFEC Properties, Inc. is now able to oversee, analyze and manage properties making a donation of real estate easy. Additionally, donors can be rest assured that their gift will be handled properly by TFEC’s professional knowledge and skill in inspections, analysis of studies and reports, and the leasing or sale of the property. Nonprofit organizations that are or will receive gifts of real estate can rely on TFEC Properties, Inc. to manage the property and produce an economic benefit for the nonprofit organization.
The next step for TFEC Properties, Inc. is to connect with donors, professional advisors and nonprofit organizations, to inform them about TFEC’s new real estate capabilities and the benefits of real estate gifts. TFEC Properties, Inc. will be holding kick-off events later in 2015 for regional attorneys, accountants, real estate agents, estate planners and other professionals. TFEC Properties, Inc. will also hold an information session specific for nonprofit organizations to provide details on the many ways in which TFEC can assist their organizations with gifts of real estate. The development of TFEC Properties, Inc. and its guidelines opens a new age for our region with significant potential gifts and economic benefit for nonprofit organizations that will further enhance and develop our communities, making them the best place to live, work and play. TFEC Properties, Inc. provides another instrument to help TFEC achieve its mission and greatly benefit our community.
Please contact Chera Yankowski, Executive Assistant, at cyankowski@tfec.org if you would like to be included on the invitation list.
Authored by: Neal S. West, Chair, TFEC Properties, Inc.
