Efforts to preserve historic properties in the District, while frequently successful, have often been hindered by red tape, bureaucracy and financial complications.
But for the individual who wants to lend a hand, it doesn’t necessarily have to be that way. An often-overlooked law allows people to get tax breaks for preserving historic properties.
It’s called the Federal Historic Preservation Tax Incentive Program, and here’s how it works: The owner of a historic property donates something called a “facade-conservation easement” to a charity such as a historic trust.
In most cases, the property owner is then required to get permission to change any aspect of exterior architecture. In return the owner will get a tax break of between 10 and 15 percent of the property value. The owner is not prohibited from remodeling the inside of the property, or renting or selling it.
The tax-incentive program, created in 1976, has been promoted heavily in the District by the Capitol Preservation Alliance, a District-based group that works to preserve historic properties and accepts donated easements. For the alliance, the tax program is a relatively easy way for historic districts to be kept intact without local government involvement.
“It’s for the average homeowner,” said CPA President Steven McClain. “We’re anchoring historic districts using individual houses.”
The alliance said it has helped about 400 people in the District earn tax benefits from the program since 1996, but that few D.C. residents realize their properties are eligible. There are about 16,000 properties in 20 historic areas in the District. Nationwide, fewer than 1 percent of qualifying property owners have taken advantage of the program.
“Almost any property that has not been damaged or altered radically in the historic districts will qualify,” Mr. McClain said. “It just has not been well articulated.”
Skeptics of the program have argued that the conservation easement restricts what a property owner can do to the exterior of a property, thus decreasing its marketability. But, Mr. McLain said, most homes in historic districts are already subject to strict local laws governing their appearance.
Mr. McClain and other program supporters also downplayed fears from some property owners that claiming the tax deduction could result in an audit from the Internal Revenue Service.
The CPA will hold a seminar to promote the tax-incentive program on July 17 at the Women’s National Democratic Club at 1526 New Hampshire Ave. NW.
In other news…
Lord Baltimore Properties sold WilllowWood Plazas III and IV in Fairfax to WillowWood LLC. Both five-story buildings are on Eaton Place, and are 100 percent leased. Grubb and Ellis brokered the sale.
Construction has begun on a 1,455-car parking garage at University Town Center in Hyattsville. The garage, being built by Finfrock Design Inc., will serve the 1.4 million square feet of office space at the town center.
Atlanta-based Wells Real Estate Investment Trust said it snagged two big office properties in Reston. Wells paid $29.25 million for Sunset Corporate Plaza I and II, a 141,000-square-foot complex housing IBM’s government-consulting group. The buildings are also home to telecommunications firm Telllabs. In this area, Wells is best known for snagging the District’s largest real estate purchase last year when it bought One and Two Independence Square from Boston Properties for over $300 million.
cProperty Lines runs Fridays. Tim Lemke can be reached at email@example.com or 202/636-4836.