MediaFile

What’s Hef paying for that grotto?

March 17, 2008

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Playboy Enterprises may not have a billion dollar skyscraper like the beleaguered brokerage firm Bear Stearns, but it does have the Playboy Mansion, and a steady revenue stream in the form of rent from founder Hugh Hefner.

Playboy’s annual report, released on Friday shows that Hef paid an estimated $700,000 in “rent and other benefits payable” to the company in 2007. The property — described as a “29-room mansion located on five and one-half acres in Los Angeles, California,” with no mention of the Grotto — must have some pretty sweet rent controls: He paid $1.1 million in 2005, and $800,000 in 2006.

As any casual Playboy observer knows, Hef has more than a few roommates. Since 2005, E! has aired “The Girls Next Door,” a reality show that stars three of his live-in girlfriends. More from the 10-K, first highlighted by footnoted.org:

Holly Madison, Bridget Marquardt and Kendra Wilkinson, the stars of The
Girls Next Door on E! Entertainment Television, reside in the mansion with Mr.
Hefner. The value of rent, food and beverage and other personal benefits for the
use of the Playboy Mansion by Ms. Madison, Ms. Marquardt and Ms. Wilkinson is charged to Alta Loma Entertainment, our production company. The aggregate amount of these charges in 2007 was $0.4 million. In addition, each of Ms. Madison, Ms. Marquardt and Ms. Wilkinson receives payments for services rendered on our behalf, including appearance fees.

Oh, and about those rent controls:

The annual rent Mr. Hefner pays to us for his use of the Playboy Mansion is determined by independent experts who appraise the value of Mr. Hefner’s basic accommodations and access to the Playboy Mansion’s facilities. … Mr. Hefner’s usage of Playboy Mansion services and benefits is recorded through a system initially developed by the professional services firm of PricewaterhouseCoopers LLP, and now administered by us, with appropriate modifications approved by the Audit and Compensation Committees of the Board of Directors.

(Photo: Playboy Mansion, Reuters)

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