Owner of Rays invests in goodwill

Stuart Sternberg says what any baseball fan would want to hear: He plans to put profit back into the team and the community.

By LOUIS HAU
Published October 8, 2005

ST. PETERSBURG - Of all the reasons Stuart Sternberg wanted to own a controlling stake in the Tampa Bay Devil Rays, pocketing short-term profits was apparently not among them.

"As a business, I don't anticipate or see the possibility of taking a penny out of (the team) for 10 years," the Rays' new principal owner said Friday during a meeting with the St. Petersburg Times. "And even then, the idea is always to reinvest it and to build capital in the community and goodwill. ... We're going to reinvest in the brand."

On Thursday, Sternberg officially took over the reins of the Rays from Vince Naimoli, a businessman first praised for bringing the Rays to St. Petersburg. But Naimoli was soon vilified for an ownership approach that left the Rays with a meager payroll, shattered community and sponsorship contacts and resulted in one of the worst records in Major League Baseball since the team's inaugural season in 1998.

The new ownership group's first move to rebuild the Rays' public image was a pledge for free parking next season. The second, he said, is the launch next week of an advertising campaign, an unusual move in October for a last-place Major League franchise given that the regular season is over.

Describing the ownership changeover as "a unique situation," Sternberg's chief lieutenant, new Rays president Matt Silverman, said the ads will be aimed at local fans "to signal that we're a Major League ball club, we want them back and a lot of changes are on the way."

Sternberg, a 46-year-old former Wall Street securities executive, offered few specifics on how he intends to turn around the Rays' commercial fortunes, explaining: "We've got a lot of plans; we don't have it mapped out just yet."

The Rays tied for second last year among all Major League Baseball teams in terms of operating income, Forbes magazine reported in April, helped by revenue sharing and a small payroll. But the Rays were also ranked as the least valuable franchise and finished the 2005 season last in attendance.

While Sternberg made few direct references to Naimoli, he stressed that he and his partners intend to manage the Rays differently than their predecessors.

Asked in jest if the Rays would ever charge admission to a high school marching band scheduled to play the national anthem (as Naimoli once tried to do), a stunned Sternberg asked quietly, "Did that happen?" He then focused on the bright side of hearing such stories from the team's troubled past.

"Spectacular. That's great because it means it was even worse than we thought in the first place," Sternberg quipped.

"If you came in and everything was hitting and (former General Electric chief executive) Jack Welch and (investment guru) Warren Buffett were running this thing ... and they had spent all this money and had invested capital and people weren't coming in and weren't watching on TV, I would have been heading in the other direction. I wouldn't even smell the place.

"So," he concluded, "there's opportunity when things like that happen."

Sternberg said the team plans to take steps to shore up its meager portfolio of corporate sponsorships. He acknowledged the Rays may have to sacrifice some smaller sponsors "to sort of clean things up a little bit" and to clear the decks for more of the big-money sponsors that the team sorely lacks.

"If you would like to have Rolls-Royce advertise with you or a premium brand, it's important that you don't have Steve's Barbershop right next door to it in the same signage," he said. "It's going to cost us some revenues in the near term to bring in the car manufacturers, the airlines, the cellular carriers and all of these businesses that you're talking about. ... If we can get the needle pointing up instead of down, I'm hoping that'll lead them back."

If big financial returns aren't in the Rays' short-term future, why did a savvy investor like Sternberg buy into the team? For a lot of reasons other than making money, he said.

"A baseball franchise is very appealing to me because of what it means to the collective consciousness of an area," Sternberg said. "I grew up in Brooklyn, N.Y., and I was born the year after (the Dodgers) left but they were very much a part of the area during the first 20 years of my life. People lamented their leaving and it brought a tear to people's eyes. ... That was the peak of what a sports franchise and a baseball team mostly can bring to an area."

Sternberg marveled that, "People still look back at it. In a perfect world, I would like to have something that emulates that."

To that end, Sternberg said he and his partners will consult with Rays community relations and business affairs vice president Veronica Costello to identify worthy local causes and charities to contribute to. He also said that the team will try to involve itself in local development efforts.

"It's not just about throwing some bats out there and throwing a gala now and then," he said. "It's going to be about trying to be an agent of some real change."

Sternberg described making positive contributions to the local area as something that "does come before winning, I'm sorry to say. The winning will feed and allow us to do what we'd like to accomplish within the whole area."

Louis Hau can be reached at hau@sptimes.com or 813 226-3404.

[Last modified October 8, 2005, 01:40:58]