By now you’ve heard that an investment group headed by Bruce Sherman and Derek Jeter have won the bidding for the Miami Marlins. Following the birth of Jeter’s new daughter last week, it is apparent he will now have two needy charges under his care. One will keep him awake all night, screaming and soiling itself, and the other will be Bella Raine Jeter. I don’t want to talk about Derek Jeter, though, I want to talk about Jeffrey Loria.
Loria, the soon-to-be-ex owner of the Marlins, will be remembered with derision and embarrassment by the league, loathing by the taxpayers of Miami-Dade County and the state of Florida, and will likely soon be forgotten to history by the Marlins fanbase, whom Loria expressly repelled. He is a black spot on the game, and while just about everyone wants to move on from him, I think that his example needs to be learned from.
Let’s start at the beginning. In 1999, Loria purchased a 24% stake in the Montreal Expos for $12 million, and was named managing partner. Over the next two seasons, he gradually forced out other partners, including the city of Montreal, until he wound up with an ill-gotten 96% interest in the franchise.
It was while undercutting his own investors that he first began a war against baseball fans by refusing to negotiate an English-speaking radio and television contract from the 2000 season onwards. A baseball blog isn’t the place to explain the various cultural conflicts surrounding French and English Canada, but to make a long story short, the lack of accessibility perpetuated by Loria’s ownership meant the Expos were effectively cut off from what could have been a coast-to-coast fanbase.
Most readers probably have a decent enough understanding of the successive sale of the Expos to what was, essentially, the office of Bud Selig. Jonah Keri gives a better description of those events than anyone (apologies for the autoplaying video), and in front of a municipal market of more than four million people, Loria turned a $70 million profit on his franchise. He then used that money to purchase John Henry’s stake in the Marlins with the help of an interest-free loan provided by MLB.
From there, Loria experienced immediate success in winning the 2003 World Series before beginning the first of several fire sales, showing to the league and baseball’s fans that he had no interest in maintaining a team’s competitiveness. The 2012 selloff is the worst example after he publicly lied to his team’s stars about their security and future of the team, telling Jose Reyes to buy a house in Miami FOUR DAYS before sending him in the Josh Johnson trade to Toronto. He was able to shave $160 million off his payroll at the time.
Slashing payroll so dramatically allowed Loria to soak up revenue-sharing benefits while avoiding baseball operations expenses. That’s who Loria is at his heart; a grifter and a moocher. Profiting off the work of others is what he’s best at, all the way down to the job that landed him his fortune initially—art dealing. All of the above examples, however, pale in comparison to the construction of Marlins Park, his greatest sin
Loria’s scam is a simple one. He holds out on building a needed stadium, musing to the public that there are plenty of other markets that need a team (San Antonio is a favorite of his), and waits for the pressure to buckle city councils. He tried to do that in Montreal to replace the dilapidated Olympic Stadium, but found no success, which isn’t surprising when you remember he cut the City of Montreal out of ownership in the first place.
Miami, however, took the bait. The city financed between 80-90% of the cost of Marlins Park, a concrete-and-marble monstrosity that’s nearly inaccessible to public transit and planned so poorly that local businesses and even the parking garages are under-leased and under-leveraged. All told, the owner put up about $100 M while the city floated a half-billion dollar bond that, after accounting for coupon payments and opportunity cost, will leave Miami on the hook for $2.4 billion by 2048, the full maturity of the bond.
Jeffrey Loria will make about a billion dollars off his initial $150 M investment, and the city of Miami will receive exactly $0 should the sale close after April 2018. Knowing what we know about Loria, there’s no chance the sale is complete before that time. The worst owner in baseball will have to stick it to the city, fanbase, and taxpayer just one more time.
Very few professional sports owners are actually good people. For every Jerry Buss there are, well, a couple of Jeffrey Lorias. That doesn’t mean that we, as fans, can’t try and hold the owners of our favorite teams more accountable. George Steinbrenner tried the same tact as Loria, wistfully dangling the prospect of a bright, shiny Manhattan ballpark and taking the Yankees out of the Bronx. Randy Levine is seemingly employed by the Yankees simply to find every public funding loophole he can, including delivering more than a billion dollars for the construction of Yankee Stadium III.
Like the Marlins, the Yankees have their fill of problematic front-office types. We remember Lonn Trost doing his best to repulse fans at the stadium. While the Yankees aren’t quite at the level of Loria and David Samson, if they’re not careful the Bronx Bombers could end up in a similar position.
It’s a precarious time for sports teams and their ownership groups. The bubble for lucrative TV deals is about to burst. Gone are the days of regional dominance and captive consumers. As more people cut the cord and cancel their expensive cable subscriptions—the lifeblood of MLB and other leagues—and instead turn to streaming content, sports as we know it are under an existential threat.
Consumers have never had more choice, and instead of being locked into watching a baseball team because it’s the only geographically relevant content, a fan can stream any game played in any league in the world, or could switch off sports completely in favor of Netflix, Amazon, HBO, or Hulu. It’s only a matter of time before those pesky blackout restrictions are lifted.
In such an uncertain period for content production, ownership groups have to be more careful than ever. Behavior like Loria’s may be beneficial for the self, but detrimental to the sport. It’s the tragedy of the commons in a $10 billion market. Jeffrey Loria is not long for baseball, but failing to heed the warnings he’s leaving behind would be a mistake for the Marlins’ new owners, and dangerous to the already-troubled executives in the Yankees front office.