Houston Proves It’s a Team Player

This city scored a touchdown when it beat out Los Angeles to win the NFL’s 32nd franchise four years ago.

Now it’s doing a dance in the end zone.

Every Houston Texans game through the rest of the season has been sold out, despite the team’s lowly 4-7 record. After plush Reliant Stadium’s 166 luxury boxes sold out last year, the team added 19 more over the summer. And they were snapped up just as fast.

Could a Los Angeles franchise have matched that kind of success?

“In Los Angeles, you have so many venues and events that they get spread out,” said David Carter, a sports business consultant who teaches at USC. “In Houston, we believe the market is deep and the fans are hungry.”

Going into the 1999 competition for the franchise, some analysts thought Los Angeles was the obvious choice: The country’s glitzy No. 2 TV market would win out over Houston at No. 11. The L.A. tender also had two high-powered backers in supermarket tycoon Ron Burkle and Michael Ovitz, the onetime Hollywood super-agent.

Houston billionaire Robert C. McNair, however, wowed the National Football League with a $700-million bid, topping the Burkle-Ovitz offer by $150 million. And league owners were underwhelmed by a lack of public and political support for a new stadium at Hollywood Park in Inglewood.

“At the end of the day, the NFL wanted money,” said Burkle, adding: “L.A. didn’t have its act together on the political side.”

Even if Los Angeles had won the franchise battle, the city just might not have supported a team the way Houston has. Sports analysts point to a variety of factors, including Southern California’s large number of transplants -- who would just as soon watch their hometown teams on television than fight freeway traffic to see the real thing.

Low attendance was one reason two NFL teams, the Raiders and the Rams, abandoned Los Angeles for towns with bigger appetites for football. After all, pro football must compete with basketball, baseball and hockey -- and there are two big-time college football teams in Los Angeles, with UCLA and No. 2-ranked USC.

In Los Angeles, Burkle said, the standards for sports teams are different from those of other cities. “You have to have a winning and an exciting team to be successful in L.A.,” he said

Houston, on the other hand, has embraced the Texans in spite of the losing record and an economic slump that has bedeviled the city since the Enron Corp. scandal broke in 2001.

“We have gone through a period where the energy-trading industry was hit hard and the oil business was hit hard,” team owner McNair said. “It has not been a boom time for Houston, and yet we’ve still been able to sell out. The reason is that our fans like what we’re doing.”

Selling out the 69,500-seat Reliant Stadium is no small feat, even in football-crazy Texas. The seats are among the most expensive in the league, ranging from $30 to $250.50. Corporate suites go for $55,000 to $225,000.

“We paid a lot for the franchise, but we expected to get a good return,” said McNair, who with his family owns 80% of the team. “I didn’t expect to get rich out of this, because fortunately I’ve already had some success, but I didn’t expect to get poor.”

McNair, ranked No. 329 on the Forbes list of richest Americans, made his fortune with Cogen Technologies. Since its founding 20 years ago, the company has grown to become the world’s largest privately owned cogenerator of electricity and thermal energy. In 1999, McNair and a group of investors agreed to pay $700 million for the Texans in five annual payments. They will make the last payment in January.

Forbes estimated the Houston Texans’ annual revenue at $193 million, third-highest in the league. In addition to money from ticket sales, television broadcasts and concessions, the team has blue-chip corporate sponsorships from Ford Motor Co., Miller Brewing Co., Coca-Cola Co., Anheuser-Busch Co. and Houston-based Continental Airlines Inc.

Harris County taxpayers financed construction of the $449-million Reliant Stadium, with Houston-based Reliant Energy, an electricity supplier, agreeing to pay $300 million for naming rights ($10 million a year for 30 years) in the boom times of 2001.

The stadium will play host to Super Bowl XXXVIII on Feb. 1, and an anticipated 88 million television viewers will get a look at Reliant’s natural grass field and retractable roof.

Between the team’s success and the Super Bowl, Houston has nearly forgotten about its last NFL team, the Houston Oilers. After the 1995 season, the team left in a huff for Nashville when owner Bud Adams failed to persuade local politicians to approve a new stadium. The team was renamed the Tennessee Titans.

“Houston is a unique city. Rather than being critical of a quarterback or a star pitcher or a point guard, they are quick to criticize ownership,” said Titans General Manager Floyd Reese, who was with the team in Houston. “They’re so business-minded. They want them to go out and buy a better team.”

For many Houstonians, McNair is that better owner. He says the team’s image is just as important as a winning record. Before each home game he walks across the field to shake the hand of the visiting coach, saying he is trying to set an example of character that he hopes may put the team in the same ballpark as the beloved Dallas Cowboys.

“If we play hard every game and don’t embarrass us off the field, the fans will love our team,” McNair said. “We’ve avoided players with spotty backgrounds -- those who have had trouble with the law, with drugs or with spousal abuse. We’ve passed on those. I think character counts.

“The Cowboys have a wonderful brand, and it’s a nice goal for us to think in terms of us,” he added. “But that brand was established over a long time during a time when they had good role models like Roger Staubach.”

McNair’s success is a lesson, said Carter, the sports business consultant, that the size of the television market doesn’t trump cash and a solid coalition of public support. Burkle figures Los Angeles will get another chance.

“I think an NFL team belongs here,” Burkle said. “You have one of the largest markets in the world, and you have a group of kids who are not going to football games, and that’s not good long term for the NFL.”