24 years after Les Alexander purchased the Houston Rockets for $85 million, he is listing the team, expecting to rake in perhaps $2 billion, giving Alexander a profit even he couldn’t have imagined when Michael Jordan went to play baseball and Hakeem Olajuwon dominated the NBA. An econ grad and lawyer, former bond trader Alexander understands value, brand and worth. The infusion of wealth in the NBA by way of tech investors, hedge fund capitalists, foreign investors and wealthy billionaires has tilted the league away from teams that were family owned to business owners that develop and incentivize global practices and strategies that work well in the Silicon Valley, on Wall Street, and in the Asian markets. 24 years later, things are going to change.
Alexander wants to slow the owner search. He wants someone who will fit in with the current management he has in place but when you sell you sell. You can only be promised so much. Having a say with other people’s money is basically impossible.
It is a conflict of interest, to be sure. Alexander wants to sell the team to make a profit. And yet he wants the billionaire buyer to adhere to his concept and not develop his own. But- and this is the conflict- it is the unnamed billionaire’s ideas and intellect and management skill and resume that make him qualified to buy the team in the first place. Good luck expecting him to dumb himself down and be submissive to what Alexander spent 24 years immersed in. He will want his turn at steering the wheel.
In 2015, when the Atlanta Hawks were in the midst of their best season ever, 60 wins, they were sold to Antony Ressler. Two years later, nothing of that team remains, not even crumbs. Not one current Hawks player on the current roster was part of that franchise setting year. That’s what new ownership does, despite promises to stay the course. They do things their way. Sometimes Rome burns.
The irony is a nightmare. The Rockets jacked Oklahoma City because a cheap owner blinked. The Rockets benefited, grabbed James Harden. Will it be the Rockets turn to go cheap with an owner only looking at the ledger and cost analysis spread sheets?
If you are rich enough to purchase a NBA team then you have the intellect, ambition, drive to create a team in the image you desire. Some rich men are fiscally conservative. When owners change hands there isn’t much empathy for the past and how it used to be done. Pages are greedily turned.
The Rockets have pluses and minuses involved in their sale. The pluses are obvious. They are a good team who have a shot at the #2 seed in 2017-18. They have two rostered Hall of Fame players in Chris Paul and James Harden. They may be able to pull off a Carmelo Anthony trade at some point in the season. Their coach, Mike D’Antoni, is a veteran who proved through hard knocks that his system works and so the Rockets have stability in their infrastructure. They just signed Daryl Morey to a new deal. They have a strong base in China that allows for global investment and capital gains. All’s good.
But all is not permanent. Ever. Contracts can be broken or bought. An owner has his own people he wants to bring in, those people he trusts. He has a vision for the team that may not exactly align with who and what the Rockets are now.
Financially, the Rockets are not a House Hunters steal. They are not one of the glamour teams yet are mortgaged to the hilt in players salaries. And then there is the elephant in the room. In 2000, the Rockets had the NBA’s worst attendance. Five years later, they were 23rd in attendance. In 2010, they were 19th. In 2015, they were 14th in attendance. In the greatest year of James Harden’s career, they were 21st in attendance. Why does this matter to a perspective owner? Because profits come from parking and concessions and television. How many people come to the games is representative of what an owner lines his pockets with and on the practical side, how long he vacations in France. It also is a window into the passion the city has for the sport. The Rockets don’t draw the way other contenders draw, 100% capacity. But to a foreign owner with deep pockets, he may not care. But if he doesn’t care, where is his emotional attachment, his desperation for a championship? The NBA is a league where a mediocre product doesn’t deny profits. Donald Sterling (Clippers) gamed the system for years and was richer for it.
Here’s a question. What if the owner meets all of Les Alexander’s qualifications and then the Rockets lose for a couple of years and billionaire guy gets frustrated? What keeps him from taking a torch to everything Les Alexander believed in and who would blame him? When you spend $2 billion for a team you can do whatever the hell you want.
The year Chris Paul left the New Orleans Hornets they were sold. That year, 2012, the Hornets won the lottery and Anthony Davis. The Hornets have had one playoff appearance since the new owner, Tom Benson, took over. In 2014, Steve Ballmer bought a Clipper team with Chris Paul, Blake Griffin and DeAndre Jordan. They never reached the Western Conference Finals. In 2010, when the Warriors were sold for $450 million, Klay Thompson and Draymond Green were still in college. Joe Lacob bought a team that was incomplete and relatively cheap. They have two titles after Lacob and brain trust reimagined the Warriors identity.
There is no magic formula. No figuring out what is next after Les Alexander finally says his long goodbye. No one knows who is coming for Houston. Tech guy. Hedge fund billionaire. Foreign investor. But the now is on the clock and it is pretty damned good for Rocket fans, so enjoy the year. It is the future that may get bumpy.
photo via llananba