In Oregon, billionaire Phil Knight, renowned as the co-founder of Nike, typically achieves his desires. His influence permeates the state as a prominent business figure and philanthropist. However, for over a year now, Knight has encountered an unyielding barrier in his attempts to establish communication with Jody Allen, the individual holding the reins of power over the fate of the NBA’s Portland Trail Blazers.
Allen serves as the executor of the estate endowed by her late brother, Paul Allen, the co-founder of Microsoft. Following his passing in 2018 due to cancer, Allen’s instructions were clear: to liquidate his assets worth over $20 billion and allocate most of the proceeds to charitable causes.
However, Allen’s estate is “likely the most intricate estate in American history,” according to Allen’s spokesperson.
Both Knight and Alan Smolinsky, a real-estate investor and minority owner of the Los Angeles Dodgers, have reached out to Allen to purchase the Trail Blazers with hopes of securing the future of Portland, which has recently seen a rise in social issues, including homelessness and crime.
The duo of Knight and Smolinsky started reaching out to Allen last year as the 2022 NBA Finals began, reportedly offering $2 million to acquire the Blazers. Not only did Allen deny their offer without a counteroffer, but she didn’t take a phone call either.
“Phil Knight and I have not spoken,” Allen told the Wall Street Journal last year.
Instead, Allen redirected Knight and Smolinsky to Bert Kolde, the Trail Blazers vice chair.
Allen informed the Wall Street Journal that Kolde also told the duo that “the Trail Blazers remain not for sale.”
That was over a year ago, and in the ever-increasing market that is the value of professional sports, as the Phoenix Suns just sold for $4 billion, Knight and Smolinsky tried again on numerous occasions, including earlier this year, telling Allen that they were aware the team’s value likely increased and are still interested in getting a deal done. The two were prepared to make an offer higher than their initial one, but Allen referred them to Kolde again, where the discussion went nowhere.
Knight even hand-wrote Allen a letter and received an email from someone speaking on Allen’s behalf saying: Paul Allen’s sports teams aren’t on the market.
“As Jody said publicly last year, the sports teams are not for sale,” says Jason J. Hunke, a spokesman for Vulcan, the umbrella company founded by Paul and Jody Allen in 1986, “That will eventually change pursuant to Paul’s wishes, but there is no pre-ordained timeline for when that will happen. Interested parties can engage when we establish a sales process at some point in the future.”
Paul Allen’s vision included the Giving Pledge, a movement among the ultrawealthy to commit to the philanthropic giving of their wealth. Allen’s vision was to save species, restore ocean health, and prevent epidemics “before it’s too late.”
Allen bought the Trail Blazers for $70 million in 1988 and the Seattle Seahawks for $194 million in 1997. Today Allen’s two largest estates are worth 25 times that, totaling approximately $6.6 billion, according to Statista.
Jody Allen could be waiting for a bond stipulation to be lifted before she sells the Seahawks. In 1997, a public referendum required that 10% of the Seahawks’ selling price go to the state of Washington if the team was sold within 25 years of the first bonds being sold. That provision expires on May 21, 2024.
The destiny of the Blazers’ residence is fast approaching a critical turning point, wherein Allen will face pivotal choices with long-lasting implications. As the original 30-year ground lease for the Blazers’ arena, the Moda Center, nears its expiration in October 2025, discussions about the financial responsibility for extensive renovations have been ignited in other cities facing similar lease expirations. The Moda Center stands among the older NBA arenas that have yet to undergo a comprehensive revamp.
The city is renowned for its exceptional quality of life. However, it has recently witnessed a surge in homeless encampments and crime, leading to a decline in population. If the Blazers franchise were to leave, it would worsen the challenges faced by the area, according to a source familiar with Phil Knight’s views.
In a significant act of philanthropy, Phil Knight donated $400 million to revitalize Portland’s historic Black community. He and his wife, Penny, contributed substantially to Portland’s Oregon Health & Science University and the University of Oregon in Eugene, where Knight was a track athlete.
Allen isn’t obligated to sell the franchise within any specific timeframe, but considering the NBA commissioner, Adam Silver, wants the Trail Blazers to stay in Portland, plus the history of what happened to the Seattle SuperSonics 15 years ago, and Phil Knight’s desire to improve Portland and solidify the franchise’s future there, Allan Cutrow, a partner at Los Angeles-based Mitchell Silberberg & Knupp LLP, believes Allen should at the least, engage Knight in conversation regarding the matter.
“They don’t have to accept it, and they may not even have to negotiate it,” Cutrow said. “But at the very least, you would think, barring something else in the (estate) document, that they would reach out to an investment banker and they have some duty to market this and get the best possible value.”