New Rockets owner says when he will (and won't) go into luxury tax

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HOUSTON -- Tilman Fertitta called off shooting for his reality show, "Billion Dollar Buyer," one day this summer because he felt sick. His attempt to buy the Houston Rockets -- 24 years after he finished second in the bidding for the franchise -- had taken a toll on him.

"You want something so bad, and you don't want to lose it," Fertitta said. "I don't think there was a close second for passion in wanting this team."

Fertitta didn't lose the Rockets this time around, paying a record $2.2 billion to buy his hometown NBA team. When told via FaceTime by Rockets CEO Tad Brown that previous owner Leslie Alexander had given the green light to close on a deal, Fertitta dropped his head and shed a few tears.

"It's a dream come true," Fertitta said. "This is my building and my team. And it's kinda fun."

Fertitta, 60, who became a billionaire as the owner of Landry's, Inc., a restaurant and entertainment company, and the Golden Nugget Casinos and Hotels, sat down with ESPN after his introductory news conference Tuesday to explain his vision for the Rockets.

ESPN: What makes the Rockets worth $2.2 billion to you?

Fertitta: Because I wanted them! [Laughs] It wasn't like I was going to probably be the only person out there [interested in buying the franchise]. Maybe I was going to be able to do it quicker than anybody else, but the team would have sold for over $2.2 billion. It's what the team was going to sell for -- and I know that -- or Les would have kept the team.

I knew what I was up against. Everybody else was busy trying to figure out how you tie what the team makes for what you pay for it. When you buy a team today, the two don't have anything to do with each other, so I was concentrating on [generating] the money when everybody else was concentrating on due diligence on the team. I knew I had a great management team. I knew I had a good basketball team, and I knew the team was always going to make between $30 [million] and $60 million a year if we got to the first round or second round [of the playoffs]. If you're over that, you do better.

So I knew where to concentrate. I knew that it's more important to go get the money quicker than everybody else. So everybody else was trying to figure out how many partners there are going to be or how to do this deal -- because all you can borrow on a basketball team is $250 million -- and I knew what I had to do. That's why I was able to do it so quick. I went and put my money together first because I knew the team was going to be worth this much, and it wasn't about what I made.

ESPN: How will the franchise change under your ownership? How do you plan to put your stamp on the Rockets?

Fertitta: This is a really well-run team. Competitively, they do whatever they can to put a good basketball team on the floor every year. It has very good management, from [CEO Tad Brown] to [general manager Daryl Morey] to the head coach to [general counsel Rafael Stone] to PR. It's kind of weird to walk into a situation where I don't have to make any changes.

Am I going to tweak things? Absolutely. I'm going to make the employee cafeteria better. I'm going to make the players' lounge better. I'm going to try to make the entertainment better out on the floor. But I'm not going to sit here and evaluate talent. That's just not what I do. I know what I know, and I know what I don't know. And I've got really good people.

"I'm not going to sit here and evaluate talent. That's just not what I do. I know what I know, and I know what I don't know. And I've got really good people." New Rockets owner Tilman Fertitta

Now, at the same time, do I know there's going to be some really tough decisions with collective bargaining and the [luxury] tax and revenue sharing and all of those? This is a business that has tough decisions to make to be competitive and tough decisions you have to make about players because of those rules. It's not going to be just fun because they're going to still come to me at the end and say, 'Hey, this is what we want to do, but it's a tough decision,' that I'm going to have to bless.

ESPN: On that note, this looks like a team that can be a legitimate contender for several years, but the price will rise significantly next summer if the core is kept together. What's your tolerance level for paying the luxury tax?

Fertitta: This is what was told to me by my experts that work here: If it's going to take you to the Finals, then you should pay the luxury tax. And I totally agree. If you have to lose money to get to the Finals or win a championship, I think you do what you have to do because it's going to come back to you.

Remember, I don't look at things year to year. I don't operate any of my businesses year to year. I look at everything long-term, so if it costs me money to win a few championships, I'm fine with that. But you don't want to be in the luxury tax and not be getting to the Finals, so if you don't have a team that can get to the Finals, you shouldn't be paying the luxury tax.

I'm going to take the advice of Daryl and his team and Tad. I will do what they suggest that we do.

ESPN: If you look at your NBA neighbors in Texas, you see owners who have been successful with very different styles. Mark Cuban has been as hands-on and outspoken as any owner in any sport. Peter Holt seems to just sign the checks and stay out of public view for the most part. Where do you envision falling on that spectrum?

Fertitta: I don't think I'm anything like Peter, and I don't think I'm anything like Mark. But most people would tell you that Tilman was already the most well-known business guy in town, and I have a national television show. So my life doesn't change very much from that respect, but I also have a $4 billion business to run over there on Post Oak [Road]. That's where I'll be every day.

I won't be coming to the Rockets office every day. Will I talk to Tad every day or Daryl every other day because they just want to update me? Yeah, but I'll be probably more involved in making sure the fan experience is better. I'm not getting into X's and O's of the basketball team, and I'm not going to tell Daryl who we should be drafting and who we should be trading. I've learned more about basketball in the last 30 days than I thought I knew from the last 30 years.

ESPN: NBA commissioner Adam Silver has lobbied for sports betting to be legalized and regulated across the country. You have an interesting perspective as the owner of the Golden Nugget casinos and now the Rockets. What's your view on this issue?

Fertitta: I think it would be great. Why have illegal activity that everybody's participating in? Let's make it a legal activity and let different jurisdictions and American capitalism take over.

ESPN: What's your all-time Rockets starting five?

Fertitta: Gosh almighty. You've got to have James Harden in there. Have Tracy McGrady as your shooting guard. Then you've got to throw Clyde [Drexler] in there. I would probably throw Hakeem [Olajuwon] and Elvin [Hayes] and Moses [Malone] at power forward today and then put Yao [Ming] there at the center position.

ESPN: That's a starting seven.

Fertitta: OK, if you've gotta go with one of the three, you've gotta go with Hakeem. But today he could probably play power forward. He was one of the first centers that started bringing the ball up the floor every once in a while.