It’s been a wild week for Portland Trail Blazers governor Jody Allen and Damian Lillard. Amid rumors that Allen refuses to take Lillard’s calls and that the team may or may not be up for sale, Lillard inked a two-year, $122 million extension. So everything is well in Portland right? Maybe…
Let’s start at the beginning. Earlier this week Allen put out a statement which read that neither the Trail Blazers nor the Seattle Seahawks, owned by the trust of her late brother Paul G. Allen, are for sale.
“As chair of both the Portland Trail Blazers and Seattle Seahawks, my long-term focus is building championship teams that our communities are proud of,” the statement read. “Like my brother Paul, I trust and expect our leaders and coaches to build winning teams that deliver results on and off the field.
As we’ve stated before, neither of the teams is for sale and there are no sales discussions happening.
A time will come when that changes, given Paul’s plans to dedicate the vast majority of his wealth to philanthropy, but estates of this size and complexity can take 10 to 20 years to wind down. There is no pre-ordained timeline by which the teams must be sold.
Until then, my focus – and that of our teams – is winning.”
Statement from Jody Allen, Chair of the Portland Trail Blazers and Seattle Seahawks, Trustee of the Paul G. Allen Trust pic.twitter.com/y3G5aSVhng
— Seattle Seahawks (@Seahawks) July 5, 2022
Allen is right that settling an estate the size of her brother’s (an estimated $20B) is not a simple thing. There are multiple assets, investment vehicles and properties that have serious legal and tax implications when liquidated. That will take time. Ten to 20 years might be a stretch.
According to the Paul G. Allen Trust all the assets are to be liquidated upon his death and the assets used to fund his passion projects. He died in October 2018.
It would be well within Jody Allen’s right and role as executor of the trust to hold out for the best offer when it comes to the Blazers and Seahawks, and that’s likely what she’s doing here.
It was reported that a group led by Nike founder and chairman Phil Knight made an offer to purchase the Blazers, but the response from Jody Allen was the team is not for sale. All that likely means is she’s holding out for a higher purchase price.
The other reality is a new owner would likely want to purchase the team with some assurances that a superstar player was on the roster. Locking Lillard up to an extension means he’s under contract through the 2026-27 season. A healthy productive All-NBA-level Lillard means the team has a higher value.
The other financial angle to Allen’s “the team is not for sale” stance is the NBA is expected to expand in the next few years. Expansion fees conservatively will be about $4 billion. That money gets divided up among the 30 governors. That’s about $133 million.
Do you know how billionaires become billionaires and increase their wealth? By not leaving any amount of free money on the table.
Regardless of her “neither team is for sale” position, the stipulations of the trust are clear. All assets are to be liquidated. When she receives the number she wants, we’ll see how quickly that process moves.
