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Spring 2005 Colorado: Transfer of Ownership of Redstone Castle, Redstone

Agency: Internal Revenue Service

After numerous discussions and meetings as part of the Section 106 review process, the Internal Revenue Service (IRS) determined that it would auction off Redstone Castle, its outbuildings, and its surrounding 150 acres, subject to a conservation easement that would be donated to the Colorado Historic Foundation.

Before the auction, the project’s consulting parties signed a Memorandum of Agreement that requires IRS to transfer the mansion, and approximately 25 acres of surrounding land with the most significant public view of the mansion, with the conservation easement.

The easement details the treatment of all significant exterior features and a number of the significant interior spaces. The agreement provides for the
recordation of some historic buildings associated with the mansion that will not be subject to the easement.

A private party purchased Redstone Castle for $4 million at the auction, which was held in March 2005.

Over the next few weeks, the IRS will complete the easement with the Colorado Historic Foundation and transfer the property to the new owner, who may operate the mansion for his personal use and as a limited bed-and-breakfast operation.

In this case, the IRS needed to ensure that the mansion brought top dollar so that the agency could return at least a portion of the funds to the former owner's investors. Many Redstone residents were concerned about the effects of the mansion’s sale on their small community, since much of their economy is based on tourism. The Redstone Historical Society and local residents took a very active role in all phases of the Section 106 consultation process, with great success.

For background information on this case, see the spring 2004 Case Digest.

Staff contact: Lee Keatinge

Posted June 9, 2005

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