The most stunning news of the NBA’s offseason had nothing to do with a free-agent signing, a blockbuster trade or a front-office restructuring. After 24 years of ownership, Leslie Alexander is putting the Houston Rockets up for sale, a shocking development announced Monday that promises to reverberate throughout the basketball world.
“It’s been my great joy and honor to own the Houston Rockets for the past 24 years,” Alexander said in a team statement. “I’ve had the incredible opportunity to witness true greatness through the players and coaches who have won championships for the city, been named to All-Star and All-NBA teams, enshrined in the Basketball Hall of Fame, and done so much for our franchise and our fans.
“The Houston community has been home to me; I will continue to support the charities I have made commitments to throughout the years. I’ll always have a special place in my heart for the fans, partners, city officials and employees who care so deeply for this team. I’ve made this decision after much deliberation with my family and friends, and do so knowing the franchise is in great shape with the players, coaches and management team in place.”
Rockets CEO Tad Brown made the announcement at a Monday afternoon news conference:
— Mark Berman (@MarkBermanFox26) July 17, 2017
“It’s been a great joy of [Alexander’s] life, and a pleasure, to be the owner of the Houston Rockets,” Brown told reporters. “The great players, Hall of Fame players and coaches, and championships won, All-NBA teams made — just the connection to the community that’s been established over 24 years has been an incredible opportunity that he’s just loved.”
Even so, the commitments of ownership “can wear on you after so many decades,” Brown said. And while Brown emphasized that Alexander has no health issues, the longtime owner has decided to look at “changing the fabric of his life,” by getting out after nearly a quarter-century in charge.
“He’s just been tired,” Brown said. “I’m sure many of you [reporters] who know him well can probably sense that. It’s a grind. It’s a grind. And even now, things are ratcheted up even that much more with the expectations [that come with adding All-Star point guard Chris Paul to MVP runner-up James Harden on a 55-win roster] and the ability to really go deep and compete. It’s been tough. And so I think he just had a real good conversation with his family, and some of his close, close friends, and he just decided it was time for him to make another change in his life.”
The revelation caught some of the most plugged-in people in the NBA completely off-guard:
Leslie Alexander's decision to sell the Houston Rockets didn't only surprise the rest of the NBA, it surprised those within the franchise.
— Adrian Wojnarowski (@wojespn) July 17, 2017
You hear from time to time that owners may be thinking of putting their teams up for sale. The Rockets were not one of those teams.
— David Aldridge (@daldridgetnt) July 17, 2017
Don't remember last time franchise being for sale shocked the league. Usually rumors/reports well in advance. This came at press conference!
— Zach Lowe (@ZachLowe_NBA) July 17, 2017
Brown said it even caught him by surprise:
— Mark Berman (@MarkBermanFox26) July 17, 2017
This latest desire for change promises to make Alexander — whose net worth Forbes pegs at just south of $2 billion — a very, very tidy profit.
The relative accuracy of those evaluations always gets batted around by sports business types. It’s worth noting, though, that the Atlanta Hawks sold for $850 million in April of 2015, a few months after the magazine valued them at $825 million. And, of course, that Steve Ballmer shelled out $2 billion for the Los Angeles Clippers in 2014 after Fobes valued the Clips at $575 million.
A desire to get into the LA media market and blow other well-heeled buyers out of the water contributed to Ballmer’s record-setting bid. Still, if Alexander benefits from anything akin to that level of inflation — and from prospective bidders eager to get their hands on a franchise that already has both a superstar player and a highly regarded top basketball executive locked up for the long haul — we’re talking some very, very big numbers.
Brown described Forbes valuations (most recently $1.65 billion) as typically "very low" compared to sale prices in past.
— Jonathan Feigen (@Jonathan_Feigen) July 17, 2017
LAC sold for $2B when 2014 Forbes valuations said they were worth $575M.
Same inflation applied to 2017 HOU valuation = $5.75B. https://t.co/XOQ7JTsH24
— Yaya Dubin (@JADubin5) July 17, 2017
Brown said Alexander’s looking to complete the sale “sooner rather than later,” but that the franchise doesn’t want “to rush the timetable.”
“We’re going to make sure that it’s the right buyer,” Brown said. “Leslie has the latitude of time, based on our resources, and his resources, and everything associated with the team right now.’
Alexander’s reportedly going to be selling the team himself, rather than enlisting an outside firm to drum up buyers for him. That is, perhaps, in keeping with the character of an owner whom NBA Commissioner Adam Silver called in a league statement “a true competitor who always searched for the right move to make his teams better.”
“Under his ownership, he created a culture of excellence with strong management that attracted Hall of Famers, All-Stars and coaching giants and brought two NBA championships and four WNBA titles to Houston,” Silver said “Well-respected around the league, he has been an active and influential owner whose vision helped to grow the game globally, especially in China. Moreover, his philanthropy speaks just as powerfully as his ownership, with local libraries, women’s centers and homeless shelters all benefitting from his generosity.”
Even with James Harden and Daryl Morey locked up, the Rockets face significant questions moving forward. Recent trade acquisition Paul will hit free agency next summer, and be eligible for a long-term maximum-salaried contract extension that would pay him more than $200 million over the next five seasons. The Rockets remain in the thick of the running for New York Knicks star forward Carmelo Anthony, too, who’s owed $54 million over the next two seasons.
Under Alexander’s stewardship, the Rockets have been willing to spend and take chances to try to put together championship-caliber rosters. Will uncertainty about who’s going to be signing the checks in the future impinge upon Morey’s big-swing approach? Will new ownership have the same vision for the franchise’s direction as the team that’s helped overhaul how NBA front offices operate in recent years by ushering in the analytics revolution?
We’ll find out the answers to those questions and more soon enough. For now, all we know is that change is coming to Houston after more than two decades of stability — and that whoever’s coming with it will have to pay a pretty penny for the privilege.
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