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House of Rock

House of Rock
Photographs by Roy Ritchie

(page 1 of 4)

The cabbie knows the heartache all too well. The last time a Cleveland team sat atop the professional sports world was 1964, when the Browns beat the Baltimore Colts, 27-0, for the NFL championship. “This town really needs a champion,” he says. “You tell Mr. Gilbert I said this is his year. The Cavaliers are going all the way.”

If Dan Gilbert feels the considerable weight of a long-suffering sports town on his shoulders, he’s not letting on. As majority owner of the Cleveland Cavaliers, who made his fortune selling mortgages over the Internet from the confines of the Motor City, he’s a Detroit booster through and through. Sure, it would be nice to own his hometown Pistons, but with Cleveland banging on the door of an NBA championship, he’s not too conflicted.

He’s also a realist. “Getting an NBA championship is a quest,” Gilbert says. “Last year, we went 8-0 in the first two rounds of the playoffs, and then we played Orlando. There were a few plays here or there that could’ve gone either way, but we lost in six games. Injuries are another factor, and something that’s unpredictable. Luck plays a part, too.”

Not one to wear his emotions on his sleeve, Gilbert likes to blend in and observe the world around him. But when the billionaire owner sees opportunity, he grabs hold and doesn’t let go. Case in point: The Cavaliers’ brass reacted quickly to the team’s major deficiency last year — that it was too soft in the middle — and acquired all-star center Shaquille O’Neal during the offseason.

Will it be enough to reach the summit? Time will tell. But don’t look for Gilbert to dwell too long on the outcome. He’s too busy enhancing a professional sports franchise. Since he acquired the team in 2005, he’s invested $35 million in the Cavaliers’ arena, including more comfortable seats, added sound, and new scoreboards. The venue also hosted 220 events last year, up from 160 events five years ago, according to team president Len Komoroski.

So what’s Gilbert’s secret? “One of the things I always look for are synergies among the various businesses we operate,” he says. “I like to call it the threads of connectivity. If we can promote our other companies as part of something we’re doing, it’s a lot easier than creating something from scratch, or having all of these silos that don’t connect to one another.”

Mindful that professional sports teams are competing for entertainment dollars across multiple spectrums, Gilbert launched a unique in-house ticketing service two years ago that allows Cavs fans to buy, sell, and transfer seats online. Goodbye, StubHub. Hello, Flash Seats. The beauty of the system is that there are no tickets to drop off or pick up. All a fan has to do is flash a credit card or driver’s license to enter the game.

“Even if a game is sold out, a typical NBA franchise only knows 40 percent of the people in an arena because there’s so many tickets changing hands,” says Jeff Kline, president of Cleveland-based Veritix, which oversees Flash Seats. “By operating our own ticketing service, we can get to know 50 to 60 percent of the people, plus there’s a better chance we can fill all the seats even if we’re technically sold out.”

Kline says that up to 7 percent more fans will come to a game because of the team’s in-house ticketing service. So that means added revenue from parking, concessions, and souvenirs. And it’s not just Cleveland fans who are benefiting. Veritix also has partnerships with the Denver Nuggets, Utah Jazz, Houston Rockets, and Colorado Avalanche. “I’d love to get Detroit teams involved,” Kline says.

The Early Years

Born on Detroit’s west side, Gilbert, 48, doesn’t remember a great deal of city life. His family moved to Southfield in the mid-1960s, and he attended Southfield schools. He was active in sports, playing both baseball and pickup basketball. But he often traveled back and forth to Detroit on the weekends — his late father, Sam, was a World Word II Army veteran who bought and operated a handful of bars after leaving the service.

Gilbert recalls playing with the adding machine at a bar and restaurant his father owned near Seven Mile and Woodward. “I’d deliver things from the basement, hang out, have fun,” he recalls. “My grandfather owned a few car washes. I guess you could say we were an entrepreneurial family, but no one used that word back then. Eventually, my dad sold the bars and both he and my mom (Shirley) became Century 21 agents.”

Those early years proved fruitful for Gilbert. He developed a knack for building things and creating value. He would deliver newspapers, sell candy or yo-yos, go door-to-door offering pots and pans — he even got into the pizza business, albeit temporarily.

“We made the pizzas in my mom’s kitchen using Chef Boyardee sauce, and we delivered them on our bicycles,” he says. “But the health department shut us down pretty quickly. We obviously had no business license and really [shouldn’t have been] operating … I think some local pizza outlets complained.

“But I did deliver pizzas for a while, and I believe I hold the world record for the most pizza deliveries in a night — 78 pies on Aug. 12, 1982 (the 4:30 p.m. to 1 a.m. shift). It was a perfect night, great weather, and all the orders were clustered. The biggest problem for a pizza deliverer is getting the money quickly from the customer. I happened to have had a great night.”

Tell Us Your Thoughts

Comments are moderated for appropriate language.

May 6, 2010 05:57 pm
 Posted by  savedetroit

Dan Gilbert is praised by all the local Detroit Media for doing his part to save Detroit. What a lark. Why won’t anyone ask him the tough questions? He originally committed to building a world class headquarters in Detroit and that he would move 4,000 employees downtown into the new building. Then last year in July 2009 Dan Gilbert said that because of the “economic downturn and housing slump” he was not able to build a new building in downtown Detroit and instead of moving 4,000 people to downtown Detroit that he would only be moving 1,700 (see ). It was during this same “economic downturn” that Dan Gilbert started lobbying Ohio residents and legislature to get a vote on the ballot to allow him to open 4 casinos in Ohio. He spent millions of dollars in Ohio promoting the ballot issue and it passes. Dan Gilbert has committed to spending over $600 million in the state of Ohio over the next couple of years to get the casinos open. Dan Gilbert has been quoted as saying that his flagship cash cow Quicken Loans Mortgage company had it best year ever in 2009 and that 2010 is off to another record breaking year. So here he is reeling in the cash, he is able to invest over $600 million in Ohio for gambling casinos but cannot build his building and move 4,000 employees to downtown Detroit – how committed is he really to Detroit?

Think about it – right now Detroit casinos get a lot of gamblers coming here from Ohio as well as from surrounding states of Ohio. Detroit Casinos are barely making it now. When Dan Gilbert opens his Taj Mahals in Ohio how many gamblers will either stay in Ohio or will go to Ohio to gamble versus Detroit? Casinos in Ohio are going to be a huge drain on the Detroit Casinos and the city of Detroit. What impact will the opening of the Ohio casinos have on the city of Detroit? Why isn’t anyone in the media asking this question? How many jobs in Detroit are going to be lost as a result of the economic hardship the Ohio casinos is going to cause the city of Detroit? How really committed is Dan Gilbert committed to the success of Detroit? The $600 million plus dollars that Dan Gilbert is going to pump into the Ohio market could go a long way to revitalizing the city of Detroit and the state of Michigan.
At the end of the day Dan Gilbert is no different than any of the Wall Street bankers and wears the same bullet proof vest that they wear. How has Dan Gilbert gone unscathed by the local media? It was his Mortgage Company, Quicken Loans, high pressured call center mortgage bankers that were selling the $0 down loans, the interest only loans, the $0 down, interest only variable interest rate mortgages that got us all in trouble to begin with (for crying out loud they are the guys that invented all these crazy mortgage programs). Dan Gilbert’s Quicken Loans single handedly did more harm to the City of Detroit and the State of Michigan than any other Michigan company by being a co-conspirator in one of the biggest scams in American history. We all lost the shirts off our backs and our homes and he fleeced his pockets with our cash. He spent over $400 million of our money buying the Cleveland Cavaliers and now he is going to spend over $600 million of our money in the state of Ohio. Like the guys on wall street he is above the law….like the guys on wall street his mortgage company can screw all us little guys and laugh all the way to the bank with his millions and millions and now billions of dollars.
Think this guy and his company are AAA rated – think again – see - or also, why doesn’t anyone report on the fact that Quicken Loans has been involved in a class action lawsuit by its employees because they force their employees to work hours and hours of overtime but refused and continues to refuse to pay its employees the overtime.

Dan Gilbert and all of his people should be ashamed of themselves for committing one of the greatest frauds on Americans. And the Detroit media should be ashamed of themselves for giving this man a hall pass and not getting underneath the real news behind Quicken Loans and what they are all about. Do not be fooled. It is corporate greed at its best. He has no altruistic goals of saving Detroit. He will save Detroit if it makes financial sense for him, and then only if he doesn’t have a better opportunity to earn a larger return on his investment elsewhere. Today it is Ohio and tomorrow who knows. The only thing larger than Dan Gilbert’s ego are the lifts in his already oversized heeled boots.

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