Mogul rent control
Rupert Murdoch will repay News Corp. for his $50,000 monthly rent, after governance gadflies complain, Fortune's Tim Arango reports.
(FORTUNE Magazine) -- Pity Rupert Murdoch. The News Corp. chairman and CEO has been caught between two Manhattan residences - his old SoHo loft, which he sold to fashion designer Elie Tahari for $25 million, and his new Fifth Avenue apartment, which he bought for $44 million in 2004 and is still renovating.
With nowhere left to go, he and his third wife, Wendi Deng, have spent the past several months camping out at the swanky Trump Park Avenue apartment house and sticking News Corp. with the $50,000 monthly rent.
That decision did not sit well with corporate-governance gadflies, so Fortune has learned that Murdoch quietly decided to pay back the money. "On reflection, Mr. Murdoch concluded it was more appropriate to cover the apartment expense himself," said a spokesman for Murdoch by way of confirmation. The company is expected to disclose the reimbursement in a future filing with the Securities and Exchange Commission.
In an SEC filing last month, News Corp. (Charts) revealed that the company had been paying the rent on the temporary apartment, plus $500 a month in utilities, since May, while Murdoch's more luxurious abode, formerly owned by the late Laurance S. Rockefeller, was being renovated. In the same filing the company said that Murdoch - a billionaire many times over - made $25.7 million last year (a $4.5 million salary and a $21.2 million bonus).
Investors, perhaps because shares are up nearly 40% over the past year, were largely unmoved: At News Corp.'s recent annual meeting, not a single question was asked about the apartment.
The Murdochs' temporary quarters at Park Avenue and 59th Street must feel cramped. Their loft was 9,300 square feet. The Trump penthouses range from 4,000 to 7,000 square feet and "epitomize the rich heritage of New York's prewar architecture, while providing every comfort of the 21st-century home," according to the building's website.
Murdoch, his wife, and their two kids may feel like hamsters escaping a Habitrail when they move into the Rockefeller residence, which is 8,000 square feet over three floors, in addition to 4,000 square feet of terraces.