Mr Lee gave the example of the art deco-style Paritai Drive mansion, which Bruce and Gladys Wilkinson gave to the Auckland City Council in the 1970s for a museum to house their collection of clocks and ceramics.
The property was sold to a neighbouring architect in 1997 for $3.6 million.
The council said the money would maintain the Wilkinson collection in Albert Park House as well as help renovating the Auckland Town Hall and the Civic Theatre.
"Nothing could turn off philanthropy better than the knowledge that further down the track someone is going to sell off or dispose of the gift,"said Mr Lee.
Councillor Christine Fletcher said there had been "huge disincentives" to people to give and she called for a report on philanthropy gifts and the council's legal commitments in accepting them in perpetuity.
PHILANTHROPY
* Sir John Logan Campbell: Cornwall Park.
* Sir George Grey: founding donor of Auckland Public Library and Art Gallery.
* James Tannock Mackelvie: Collection in the gallery and museum.
* Emilia Maud Nixon: Garden of Remembrance, Howick.
* Iwi of Ngati Whatua, Waiohua, Tainui and Hauraki: park land.