One of the bay area's newest professional sports team owners wants to buy up to a half dozen Minor League Baseball teams around the nation because, while major league teams struggle, profits are easier to come by in the minor league.
By JEFF HARRINGTON
Published October 27, 2003
[Times photo: Chris Zuppa]
David Hersh was 22 when he purchased the Portland, Ore., Beavers in 1979.
TAMPA - He owns a professional baseball team and is known in the league for his dealmaking, demanding temperament and championship seasons. An East Coast native, he has adopted Tampa as his home. People either love him or hate him.
And his name is not Steinbrenner.
The Tampa Bay area's newest sports mogul, or mogul-in-the-making, is a confident, smooth-talking Philadelphia native named David Hersh.
A longtime fixture as an owner and manager in Minor League Baseball, Hersh moved to Tampa last November. He was regrouping after selling a minor-league team, the West Tennessee Diamond Jaxx, in a bitter departure that's still in litigation.
Uncharacteristically, he wanted to keep a low profile in preparing for his biggest move in baseball yet. "I was shocked you guys found me. . . . (This) takes my anonymity away," Hersh said during a recent interview at his tony, three-bedroom condominium on Tampa's Bayshore Boulevard.
Anonymity became hard to maintain after the 48-year-old investor closed a deal to buy the AAA-level Tacoma, Wash., Rainiers for $11-million last month. Investors in his new company, Fun Entertainment, made public their intent to buy up to a half-dozen ball clubs around the country by 2006. Hersh hopes to clinch a deal to buy a second ballclub within weeks.
His push underscores a rich irony in baseball. Most minor-league players are eager to move up from low-budget games played in small ballparks where many fans cannot name players in lineups that change more often than the corny promotions. The owners of those teams, though, might not have the same major-league ambitions.
That's because while high player salaries and attendance woes are crippling some major-league baseball teams, profits are easier to come by in the minors.
The profit potential of major-league clubs is often dependent on the size of a market, the payroll and the number of wins propelling a team into post-season play. Not so in the minors. As farm teams, most minor-league teams rely on their major-league connection to pick up players' salaries, per diem expenses on road trips, even the tab for uniforms. The farm teams spend a little on marketing and other front-office expenses, but not much more.
As a minor-league owner, "I would fire my general manager if I wasn't making $250,000 to $300,000 a year," said George Lapides, sports commentator for the Memphis station WREG-TV and an investor in the Memphis Chicks baseball team before Hersh bought it.
Minor League Baseball, which has headquarters in St. Petersburg, oversees 160 teams in the United States and Canada that are farm teams of Major League Baseball and operate as businesses. That doesn't include teams overseen by Minor League Baseball that don't charge admission to fans and aren't affiliated with the majors.
Only about 5 percent of the farm teams change owners in a given year, according to the minor league. League spokesman Jim Ferguson won't talk about Hersh because his application to buy the Rainiers is still pending even though the deal has been approved by both buyer and seller.
Hersh's game plan appears straightforward: buy clubs that are troubled by low attendance, a poor market, an aged stadium or perhaps all three. Then threaten to move the team if local leaders don't pony up funds to build a new stadium. That's the case with Tacoma, the farm team for the Seattle Mariners. Tacoma's civic leaders are still mulling Hersh's demand to renovate their stadium or build a new one before the current lease expires in 2005.
"To move a team is not easy (but) we're not afraid of that," Hersh said. "We've been through it before."
It's vintage Hersh.
In 1992, Hersh bought the Memphis Chicks. Five years later, he moved the minor-league team 90 miles to Jackson, Tenn., and renamed it the West Tennessee Diamond Jaxx.
There's still ill will in Memphis, sportscaster Lapides said. His view of Hersh? "If you can't say something nice about someone, you shouldn't say anything at all."
Nor did Jackson host a David Hersh Appreciation Day when he sold the team and left that town last year. A court fight continues over more than $150,000 in ticket surcharges that Hersh allegedly owed the city when he sold the team. Hersh has countersued, saying the city broke its promises, costing him and his partners much more than the unpaid surcharges.
"He objects to paying the city what he owes the city and feels I'm extremely unkind by expecting him to do that," Jackson Mayor Charles Farmer said. "He's one of a kind," the mayor continued, choosing his words slowly. In what ways? "In many ways."
Hersh shrugs off complaints.
"I'm not afraid to make decisions, to pull the trigger, and that makes people unhappy. There's not a lot of gray with me and that upsets a lot of people," he said, sitting in his condo dressed, perhaps metaphorically, in a black shirt, black pants and dark loafers without socks.
"Everyone wants to be loved," he added. "Oh well, I'll live."
* * *
Though baseball is Hersh's passion, it's hard to tell that from a walk through his condo.
There's an oversize trophy from the Diamond Jaxx' Southern League championship season in 2000 and a few championship rings, but most of his sports memorabilia is in boxes. Instead, Hersh's home is decorated with Asian artifacts and furnishings assembled by an interior decorator.
It's "basic bachelor," he said with a laugh.
Divorced, Hersh plans to sell the condo eventually and buy a larger house in the bay area to have ample room when his two teenage children visit from Philadelphia.
Before moving here, Hersh said, he was familiar with Tampa only through occasional visits. He said he was drawn to the easygoing lifestyle, the weather and, perhaps most important, an unbeatable airport. He considers Tampa the ideal base for traveling the country to meet with investors and examine ballclubs whose owners have put them on the market.
Hersh downplays his financial involvement in the project and deflects questions about his net worth. He says he's relying on much deeper pockets to fund Fun Entertainment.
His goals are undoubtedly ambitious: create a $50-million operation in a couple of years. With a national cluster of ballclubs, he said, he could draw 2-million fans a year, as many as any major-league club. "We just won't have a big player payroll."
Hersh has hired a Boston sports investment company, Game Plan LLC, to find investors who want to own a chunk of a minor-league team, whether for profit or entertainment. Hersh's job is to find buyout targets like Tacoma.
"Anybody, anybody, can come up with acquisitions," he said. "You just have to know where to look."
* * *
Hersh received his first dose of national publicity in 1979, at age 22, when he bought the Portland (Ore.) Beavers. It made him the youngest pro baseball team owner in the country.
Growing up in Philadelphia, Hersh had the luxury of attending professional sports of all sorts as a member of the well-heeled Milner family, owners of a prominent local jewelry store and gift marketing company.
"Every Sunday was a family outing" to see the Philadelphia Eagles play, he recalled. The young Hersh's first Eagles' outing was the 1960 championship game at the old Franklin Field. An avid hockey fan, he also held season tickets to Philadelphia Flyers games.
Hersh had limited success playing sports himself. In basketball, he said, "You know you're in trouble when you're 6-foot-3 and playing center because you can't move anywhere else."
Eager to play football, he went to Monmouth College, a small, liberal arts school in Illinois. But bad knees kept him off the team. He became a rare student coach and was put in charge of the offense.
Hersh remembers the day at Monmouth when the die was cast for his career.
"We were losing the conference championship game 7-0 at halftime. So if you're in charge of the offense, you're not in a particularly good mood," he said, "And the head official came over and asked me if I would consider a career in baseball and I told him to f-- off. I thought he told me I was a lousy coach."
After the game, Hersh found out the head official doubled as president of the Midwest minor baseball league and was trying to offer him a job as general manager of a Class B baseball team in Burlington, Iowa. The salary: $5,400 a year. Hersh accepted.
The first minor-league baseball game he attended he sat in the dugout of the Burlington Bees. "A little Jewish boy from Philadelphia in the middle of Burlington, Iowa," he said. "Now that's a fish-out-of-water scenario."
He quickly learned it wasn't a glamorous role. Cooking hot dogs and changing toilet paper were among the unwritten parts of the job description. On the field, the Bees got on a roll, setting an attendance record and winning the league championship that season.
He was hired for the next season as general manager of the Appleton (Wis.) Foxes. The Appleton team also set an attendance record and won a league championship.
After a year, the restless boy wonder left to buy his own team. He lined up investors and paid $256,000 for the Portland Beavers. Hersh didn't put his own money into the deal, he said, but he was in charge.
In Portland, Hersh and his associates came up with their share of the wacky promotions that make minor-league baseball unique. Once when several Portland players were suffering hamstring injuries, Hersh organized Hamstring Night: Participating fans ran the bases with canned hams tied with string to their legs.
Hersh's favorite promotion, which he is likely to resurrect with his new teams, involves married couples racing to pop as many balloons as possible between their bodies using different positions. "Night after night, this is funny," he said.
But Hersh wasn't having much fun after a few years mired in the business details of running a farm team. His opportunity to branch out came in 1983, when he was hired to be in charge of player development for George Steinbrenner's New York Yankees.
He lasted only a year in the big leagues. Today he'll say only that he "saw some things that I wasn't particularly pleased with" at the Yankees. Hersh won't criticize Steinbrenner directly, saying his fellow Tampa resident has always been cordial.
"There's a lot of things that George does that people criticize," he said. "There's an awful lot of things that George does that people have no idea about that would defuse some of the criticism."
After the Yankees, Hersh took a break from baseball, joining his family jewelry and marketing business in Philadelphia. Hersh oversaw providing gifts and prizes for Atlantic City casinos to shower on high rollers.
Baseball lured him back in 1992 when the Memphis Chicks became available. Hersh came to Tennessee as an owner, bringing his flair for marketing
"He's an aggressive promoter and he worked real hard to put people in the seats," said Steve DeSalvo, general manager of the Greenville Braves and Southern League vice president.
But Hersh apparently wore out his welcome in Memphis by pressing unrelentingly for a new stadium. When he moved the team to Jackson, renaming it the Diamond Jaxx, he sold the territorial rights for a franchise in Memphis to Storage USA founder Dean Jernigan. A year later, Memphis built a stadium for Jernigan's team, renamed the Memphis Redbirds.
When Hersh sold the Jackson team for a reported $7-million 13 months ago, he said he was moving to Tampa to take in a few minor-league games and consider his options.
Buying a major-league team is not on his agenda. Hersh said he's happy in the fan-friendly, and profitable, farm teams. And he doesn't even want you to call them "the minors."
"I have always resented the term minor because there is nothing minor league about this project," Hersh said. "I don't like the people we represent being called minor in any way, shape or form because they're not minor.
"Mark Prior was pitching in Jackson, Tenn., last year. He pitched in Chicago (during the Cubs' playoff run) this year. That's pretty special."
- Times researcher John Martin contributed to this report. Jeff Harrington can be reached at harrington@sptimes.com or 813 226-3407.
David Hersh
Age: 48
Hometown: Philadelphia
New home: Tampa
Marital status: Divorced
Children: Adam (16) and Jessica (13)
Corporation: Fun Entertainment LLC
Goal: Buying a string of minor league baseball teams
Career highlights: Owner of the Portland Beavers (1979-83); New York Yankees director of player development (1983-84); owner of the Memphis Chicks (1992-97); owner of the West Tenn Diamond Jaxx in Jackson, Tenn. (1998-2002); owner of the Tacoma (Wash.) Rainiers (2003-present).
Most notable former baseball boss: George Steinbrenner
Notable baseball players formerly on his minor league teams: Chicago Cubs pitcher Mark Prior; Florida Marlins first baseman Derrick Lee; former Milwaukee Brewers slugger Paul Molitor; and former Chicago White Sox pitcher LaMar Hoyt
Most notable game promo gone awry: Holding "Skylab Night" in 1979 when pieces of the American space station fell back to Earth. The Portland promo involved tossing Hershey Kisses to fans from the stadium roof, but helpless spectators wound up getting pelted by the chocolate projectiles.
Notable quote on running a baseball team: "The key is to be a business without making the fans regret the business at all."
On his willingness to relocate a ballclub to another city: "Sometimes we embark on a path that some would prefer not to travel. We're not afraid to walk that path. Sometimes that path needs to be walked. You just pay a price for walking that walk. And that seems to be my role in life."
Changing the lineup
There have been five ownership changes among Minor League Baseball teams so far in 2003, and a few more are pending or expected. That keeps the number of ballclub sales fairly consistent over the past six years.
