[Yahoo! Finance] : Texas Billionaire Who Levered Restaurant Empire Hit on All Sides

We used to joke he is broke... now it may actually be true.

 

A wild Tilman defender appears!

 

Maybe he can open up a high end sneaker store.

 

If you’re putting down 20% on a house you really can’t afford then yes of course you’re really broke.

 

cheaper sale price, not cheaper owner.

"mega billionaire"

 

Seems most are piling on here. Like no other person is effected by the economic down turn. This Ahole has made his dream come true by owning his home town team. He shows himself to be just that an Ahole consistently. I still feel for him because no one could have predicted what the world is going through; but some here hold him accountable because every aspect of his diversification is effected. He like most are scrambling to make the best of the troubling times.

 

Excerpt from the article: "A sizable portion of Fertitta’s fortune -- including the Rockets, his hotel properties and his personal cash -- are held separately from Golden Nugget, and therefore isolated from any claims creditors of the company might have."

And yet it also says he acquired the Houston Rockets for $2.2 billion in 2017 by saddling more debt on his other businesses.

So then, I'm guessing those "other businesses" don't include Golden Nugget.
His other big business is his hotel properties, but it sounds like they're treading water, as well?

Anyways, this might be the way a lot of people run companies and expand their wealth, but it seems rather precarious. Once the dominoes begin falling... etc.

EDIT: Never mind. This is fully being discussed in another thread.

 

The NBA should make him sell the team so creditors don't go after it. Creditors could find a way to get to him if his businesses go under.

 

so why not bid it to the highest bidder.. shouldn't matter if you're a "MEGA" billionaire lol

 

He will be able to leverage all his assets and get some of that 0% interest free money from the government, he will be fine.

DD

 

I’m almost certain he will sell part of the team in the next couple of years. Of course he will say otherwise, because if he appears desperate it will drive down the price, but make no mistake, he is losing his ASS right now. If this downturn goes on for much longer he’s definitely going to have to do something.

 

Yes, if you can't afford to continue your mortgage payment.

No. Small business owners, unlike billionaire business men like TF, don't have multiple assets to sell off in order to keep their businesses afloat. People here are saying that if Tilman sold the Rockets, he would likely have been able to keep his restaurant and casino businesses alive past this pandemic time.

Most people would sympathize more with the little everyday guys than the big bad boys in difficult times.

 

I don’t know about taking shots at someone being affected by what’s going on right now.

You have to know how to distinguish between a bad owner and a bad person; sports issues and real life issues. Now I know there are questionable decisions on his part both sports and real life, but it really is his business, literally. He has to go about conducting it the way he thinks is best. As long as he’s not being evil, it’s really not our place to judge.

On a slightly different topic, I can’t remember the bidding process when Les sold the team. I’m assuming Tillman was simply the highest bidder? Were there any other names that we know for sure had a competitive bid, and if so who were they (fill me in, I don’t know about Houston’s rich and famous)

 

Beyonce and JayZ can buy the team?

 

"A few months."

 

The thing is he isn't diversified enough though. Sports, restaurants and casinos are all entertainment/luxury spending, friday night/weekend dependent income sources that all work off of a lot of the same risks and demand patterns.

Not ragging on him. I think this article is educating people on what it means to be highly leveraged and how a billionaire doesn't actually have a billion dollars cash. #themoreyouknow

A lot of people are harping on the players helping more people than owners. Not all owners are equally leveraged. Harden is probably more liquid than Tilman. He pulls in $100M/year and doesn't have any overhead, payroll, loans, real estate costs, etc unless it's elective.

Restaurants typically operate on razor-thin margins anyways. Ball players have no margins, just the cost of their lifestyle. If you own a $100M restaurant with 4% margins and can spend/reinvest that $4m/year, that's different than the ballplayer that gets paid $20M and can has $15M cash left after paying for his house and car notes (if any).

 

What part of the economy is business as usual?

 

utilities, multifamily condo's/apartments, grocery, fast food, CPGs

 

Wealth Plunge

The market turmoil has shrunk Fertitta’s estimated net worth by about a third since last month, bringing his calculated fortune on the Bloomberg Billionaires Index to about $3.2 billion Tuesday. The decline was enough to bump him off the ranking of the world’s 500 largest fortunes.

A sizable portion of Fertitta’s fortune -- including the Rockets, his hotel properties and his personal cash -- are held separately from Golden Nugget, and therefore isolated from any claims creditors of the company might have. Still, he says he can make extra cash for Golden Nugget available if needed.

“I had a call from somebody this week who asked if I would sell 50% of the Rockets for $1 billion and the answer was no,” he said. “I could have gotten $1 billion, but I don’t need it.”

https://www.yahoo.com/finance/news/texas-billionaire-levered-restaurant-empire-151300657.html

added to the original article