The House That Porn Bought: UDATE

SELLER: P.H. Realty Associates
LOCATION: 14-16 East 67th Street, New York
PRICE: $59,000,000
SIZE: 20,000+ sq. ft., 5 bedrooms, 6 full bathrooms, 3 half bathrooms
DESCRIPTION: (shortened from the listing agents website) The six story mansion contains original features such as the Carrara marble staircase. There is a Georgian Library of knotty pine paneling circa 1770. On the third floor is a 4,000 square foot master suite which has a fireplace, private garden…, ladies dressing area and bathroom with gold mosaic bathing tub, a gentleman’s dressing area on the opposite side of the room, sitting room, and separate studio.

YOUR MAMAS UPDATE: Your Mama first discussed this property back in December of 2006, but this update comes courtesy of Braden’s Keil’s Gimme Shelter column. Keil really turned it up a notch this last week and we’re still playing catch up with all his juicy tidbits. According to Keil, the former Guccione mansion looks like it may have finally found a buyer. Given the hefty asking price of $59,000,000, this sale, if it goes through, could easily set a new record price for a New York state residence.

The current record was set in October 2006 when J. Christopher Flowers, an obscenely rich investment banker, bought the mammoth Harkness Mansion on East 75th Street. Purchased from banker Jacqui Safra and producer Jean Doumanian, who never actually occupied the house and paid just $6,900,000 for the property in 1987, Your Mama nearly peed our real estate lovin‘ pants when we read Flowers purchased the the house for a jaw dropping $53,000,000. See babies, the price was particularly stunning as the 20,000 square foot behemoth “fixer upper” needs many, many million of dollars in renovations.

Anyhoo, back to the Penthouse Palace of Porn on East 67th Street. Your Mama would like to apologize for not doing as much homework as we should have when we first posted about this house. If we had, we would have been able to tell the children the house is no longer owned by Guccione and is in fact being sold through a group called P.H. Realty Associates. FYI: the P.H. stands for PentHouse.

This is all a wee bit confusing children, so if you care to read further, put on your thinking caps and see if you can stay with Your Mama.

Throughout the 1990s Guccione faced declining fortunes and financial difficulties. This house, with annual maintenance costs reportedly exceeding $5,000,000, became an unaffordable albatross around his neck. Eventually he was unable to continue making the astronomical mortgage payments. MORTGAGE? This man should have had the mortgage paid off back when he was swimming in all that T and A money.

Guccione first tried to sell the house in 2002 to ease his debt burden. However, the house found no buyers and was subsequently taken off the market. The property was foreclosed on in November of 2003. However, a group of investors came to the aid of Guccione and through an entity called NY Real Estate, LLC paid $26,500,000 in cash for the property. The cash for the purchase was floated as a loan to NY Real Estate, LLC by several groups including Laurus Funds, a hedge fund organization.

NY Real Estate, LLC was a group owned by the publicly traded Penthouse International, of which Guccione was no longer CEO, but was technically still his employer. And was soon enough his landlord too. Penthouse International leased the house back to Guccione for a lifetime lease of $1.00 per year. However, due to both Guccione’s and Penthouse’s continuing bankruptcy issues and mounting legal fees, Penthouse International found it in their best interest not to refinance the mortgage–the house, with it’s lifetime lease was simply not marketable as an asset. As a result Laurus sued for possession of the house.

It appears the NY Real Estate, LLC group was then re-formed into P.H. Realty Associates, Guccione was tossed out on his keister, and the house once again put up for sale.

Your Mama hopes this story has finally found an happy ending with the pending purchase.

Sources: NY Post, Wikipedia, USA Today

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