Real estate developer's donated ranch aids university's mission
Real estate gifts are increasing because of the benefits they offer for donors
Iconic real estate developer Rusty Lyon Jr. wanted to help future generations pursue their educational and professional dreams. One way he did that is through what he knew best — real estate.
Lyon was a real estate visionary who started his career at his father's brokerage, Russ Lyon Realty, after serving as an Air Force pilot in the Korean War. He founded Westcor Companies in 1964 and developed more than 12 Valley malls in his career. Lyon branched into hospitality development and is credited with designing and building the Boulders Resort and Spa and others.
The main residence of La Cienega Ranch, a 77.25-acre property donated to the ASU Foundation that was recently sold.
He ran Westcor for nearly 40 years before selling it to shopping center developer Macerich in 2002. He then retired to spend more time at his 77.25-acre La Cienega Ranch at the base of the Mogollon Rim near Payson, Arizona. The ranch was a place to unwind and escape the metropolitan busyness for Lyon, his wife, Rosie, and their children and grandchildren.
Rosie Lyon died in 2008, and once her husband's health declined in 2016 the family donated La Cienega Ranch to the ASU Foundation for A New American University to benefit Arizona State University. Rusty Lyon died several months later.
The foundation's real estate affiliate, University Realty, recently sold the ranch that included nearly 15,000 square feet of livable space among seven homes, a barn with horse stalls, helipad, pond and group ramada for $4.5 million.
Real estate gifts are increasing for universities because of the many benefits they offer for alumni and other donors. From fiscal years 2016 to 2020, public and private U.S. colleges and universities received more than 3,630 real estate gifts valued at $928.3 million from donors, according to survey data from the Council for Advancement and Support of Education.
"Gifts of real estate may provide donors income, tax benefits and the opportunity to make a difference," said Brad Grannis, portfolio and assets manager for University Realty. "There are several options to donate real estate, depending on when you want to transfer the property and whether money is owed on it."
Over the years, Grannis helped the ASU Foundation receive several real estate gifts, which have funded scholarships and enrichment opportunities at ASU.
For the Lyons, donating the ranch to ASU made the most sense.
"It all depends on each person's estate, but it certainly can have tax advantages," said Scott Lyon, one of the Lyons' sons and founder of Westroc Hospitality. "At the time, the market was pretty soft, and it's such a narrow market for who would be buying a property like that. If they (my parents) sold it, they'd have to pay capital gains taxes. If they kept it in the family, we would have to pay estate taxes on the value of the ranch and not be able to sell it in time before the taxes were due. They eliminated a burden on the family from an estate standpoint."
Lyons' support of ASU
Lonnie Ostrom, former president of the ASU Foundation, has fond memories of the Lyons and their ranch. He and his wife, Martha, became good friends with the Lyons and visited their ranch periodically where they played bridge and enjoyed the property's amenities.
"They were just really humble, down-to-earth people," Ostrom said. "They were very wealthy, and you'd never know it."
Ostrom recalls taking development officers from ASU's Teachers College — now the Mary Lou Fulton Teachers College — to Charleston's Restaurant for lunch, and he'd invite Rosie Lyon to join them.
"She always brought coupons," Ostrom said. "I'd say, 'We're paying for it,' and Rosie would say, 'I know, but this will make it a little less.' She had a great sense of humor, and they loved ASU."
The Lyons were longtime ASU supporters who donated to athletics, W. P. Carey School of Business, The College of Liberal Arts and Sciences, Mary Lou Fulton Teachers College, Arizona PBS, Herberger Institute for Design and the Arts and other units and programs.
Rosie Lyon graduated with a degree in elementary education from Arizona State College, the precursor to ASU. She was inducted into ASU's College of Education Hall of Fame in 2004, and she received the Alumni Service Award in 2006 and became a lifetime member of the ASU Alumni Association. She served on the executive committee for the ASU Campaign for Leadership from 1995 to 2001 and was a member of the Adopt A Devil Program.
Rusty Lyon served on the ASU Foundation and the University Research Park boards and was active with the university for a while, Ostrom said.
La Cienega Ranch history
La Cienega Ranch – named after a ranch in Rosie Lyon's family – was a summer retreat for the Lyon family from the mid-1980s until 2016 when they donated it, said Scott Lyon, who toured the property with his parents when they first saw it.
"My mom, Rosie, it was really her gig," he said. "Dad loved being there when he was there, but she had a soft spot for it."
There was an old post office at the site of the tack room until it burned in 1990 in the Dude Fire, which devastated more than 24,000 acres, destroyed more than 70 structures and killed six fire crew members. The other structures at the ranch remained, but the surrounding ponderosa pine forest was ravaged by the flames.
"That fire really broke my mom's heart at that time," Scott Lyon said. "They stuck it out. They continued to improve the property."
Two homes, a maintenance garage and a barn with tack room were built on the property following the fire.
One of the original structures at the ranch, called the Gingerbread House, served as a primary residence until the Lyons built the more than 3,700-square-foot rustic lodge in 1986 that was designed by Bob Bacon, architect for the Boulders Resort and Spa in Scottsdale. The Gingerbread House was built in approximately 1880 and was actually two historic homes that were later connected together to make one log cabin, Scott Lyon said, adding that he, his wife and daughters stayed there several times.
He and his four daughters have "super fond memories" of La Cienega Ranch and spending time in the area hiking, exploring and horseback riding.
The Lyon family's generosity will enable University Realty to invest in real estate for the benefit of ASU.
The family wanted their gift to benefit real estate-related opportunities, given their involvement in the industry, Grannis said, adding that real estate gifts to ASU can be designated for any cause the donor chooses.
"Donors receive a charitable deduction for the appraised value of their property and forgo the expense of closing costs," said Frank Aazami, broker with Russ Lyon Sotheby's International Realty who represented University Realty in the sale of the ranch. "The donation of appreciated real property to the foundation is a wonderful way to provide enhanced benefit to donors.”
His colleague Erika Sahagun Dickey added that escalating land prices have many owners assessing their options.
"Real estate gifts of appreciated property potentially save significant capital gains tax and can increase the after-tax impact of your charitable giving," she said. "They are a great way to rebalance your property portfolio and support the university in the process."
To learn more about real estate gifts to ASU, contact Brad Grannis at 480-965-8098 or Bradley.Grannis@asu.edu or your development officer.
