Two security guards wearing headsets stood outside the heavy doors of the private banquet hall on the second floor of the Four Seasons Hotel in Beverly Hills.
Here, besides the owners, COOs and general managers of the twenty-nine teams, there are only a few of David Stern's core legal advisors.
David Stern left half an hour earlier after making a few polite remarks, leaving the room for the billionaires and professional managers to meet privately.
The room was dimly lit, the aroma of Cuba cigars mingling with the scent of Scotland whisky swirling under the low ceiling. Groups of two or three people sat around the leather sofas, glasses in hand, chatting idly about All-Star Weekend, but their minds were preoccupied with the two documents that had just been distributed that afternoon.
One document was the " Charlotte Bobcats Expansion Draft Implementation Guidelines," and the other was a pre-negotiation memorandum of the 2005 collective bargaining agreement compiled by the league's Labor Relations Committee. Add to that the upcoming mid-season trade deadline next Thursday, and the air in the room was thick with an unyielding tension.
Lin Qi took off his trench coat and handed it to the waiter. Wearing a well-tailored dark gray suit and holding a glass of iced soda, he led Sam Presti slowly through the corridor.
At that time, the NBA appeared to be developing rapidly to outsiders, but the actual situation was very complex.
On the one hand, thanks to David Stern's relentless global promotion efforts, the market valuations of NBA teams have Rockets. Four years ago, a mid-to-lower-tier team was worth just over $100 million, but now even a bottom-tier team in a small market has a valuation that has steadily reached $250 million.
On the other hand, stripping away the illusion of asset appreciation, the actual operation of basketball as a physical business is a complete mess.
The collective bargaining agreement signed in the late 1990s dragged more than half of the league's owners into a quagmire of losses. Fully guaranteed maximum contracts of six or seven years were rampant, while this year the league's salary cap was capped at $43.84 million, and the luxury tax threshold was set at $55 million. Any team that exceeds the salary cap will have to pay a punitive penalty to the league for every penny of the excess.
Of the 29 teams in the league, less than a third can actually make a positive profit from ticket sales, local broadcasts, and related commercial developments. The vast majority of teams are hoping to get a share of the national broadcast revenue coordinated by the league at the end of the season to make up for their losses.
Lin Qi carried his water glass through the corridor, his gaze inadvertently sweeping over the sofas near the window.
In that corner, Wang Jialian was looking down at the financial statements in his hands. Although this tycoon, who made his fortune in the software industry, had leveraged Yao Ming, the All-Star starting center, to tap into a massive Asian market and commercial sponsorships, the meager attendance at the Continental Airlines Arena in New Jersey and the cheap local broadcasting agreements still caused the team to continuously devour the parent company's working capital in its daily operations.
At the very center of the bar, Phoenix Suns owner Jerry Colangelo, holding a martini, was quietly checking details with his financial advisor. This legendary figure, who had dominated Arizona basketball for decades, was currently pushing forward with a plan to cash out his remaining shares, and the buyer was none other than Patrick, a distant Ireland relative from Lin Qi's fiancée's family.
Lin Qi sat down on a single leather sofa by the window and took a sip of soda water.
Looking at his colleagues with their varied expressions not far away, Lin Qi felt a little amused. Take Chris Paul Allen, the owner of the Portland Trail Blazers, for example. This Microsoft co-founder, who has hundreds of billions of dollars in wealth, is so rich that he can easily invest in spaceships and superyachts. Yet, when it comes to the NBA business, he is extremely meticulous about luxury tax penalties of tens of millions of dollars. In order to get rid of the more than two hundred million dollars in construction debt of the Rose Garden Arena, Allen did not hesitate to instruct the arena's operating company to file for bankruptcy protection in the Oregon Federal Bankruptcy Court.
The money of the super-rich is never easily earned. In the world of capital, personal hobbies are one thing, while the rate of return and risk isolation of business investments are another. The aftershocks of the bursting dot-com bubble are still spreading, and even Chris Paul Allen would never tolerate a team that causes trouble year after year, like a bottomless pit, continuously bleeding itself dry.
Just as Lin Qi snapped out of his thoughts, two figures walked quickly from beside the fireplace, one after the other.
Leading the way was Isaiah Thomas, who had just taken over as president of basketball operations for the New York Knicks two months prior. He was wearing a dark blue double-breasted Armani suit, and a broad smile graced his face from afar. Half a step behind him was Bob Whitchett, general manager of the Portland Trail Blazers.
Compared to Thomas's energetic demeanor, Whitshire looked terrible. This manager, known for his extravagant spending in the Northwest Division, now had dark circles under his eyes, his tie was askew, and the ice in the half-full glass of bourbon he was holding had melted.
"Lin, I was just talking to Bob about you." Thomas reached out and shook Lin Qi's hands warmly. " Dwyane's ( Wade's ) performance in the rookie game was outstanding. Mr. Dolan was on the phone this morning marveling at how, in terms of the league's management, no one can compare to you when it comes to picking young talent and managing a team as a whole. You've won four championships, and Boston not only has banners hanging all over the arena's dome, but the team's financial health is the envy of the entire league, making us colleagues feel ashamed."
Lin Qi withdrew his hand, pointed to the empty sofa opposite him, and turned to Whitshire: " Bob, Mr. Chris Paul Allen didn't come to Los Angeles this weekend?"
Upon hearing his boss's name, Whitsit's facial muscles twitched, and he took a large gulp of wine with a wry smile, " Chris Paul's still in Seattle arguing with those Wall Street bondholders. He has no time to come and join the fun. The arena's bankruptcy restructuring is a huge headache. Chris Paul confided in me on the phone the other day that if he gets another $30 million luxury tax bill this summer, I'll be packing my bags."
Lin Qi leaned back on the sofa, took a sip of his soda, and looked on with an air of schadenfreude. "Bankruptcy court judges are much easier to talk to than David Stern. What brings you two here today?"
Thomas sat down on the sofa, unbuttoned his suit jacket, leaned forward, and said humbly, "Lin, let's be frank. I just took over the mess in New York. Allan Houston still has three and a half years left on his contract, and his knee cartilage is so worn down that it's hard to say whether he'll even be able to run next season. McDyess's leg is also ruined. Now New York's total salary is approaching $95 million, and Mr. Dolan keeps saying he wants to see results. With this salary structure, I don't have much room to maneuver."
Whitsit sighed beside him, " Portland isn't much better. Damon, Dale Davis, Derrick Anderson —a bunch of long-term contracts are sitting on the table, totaling over $83 million in salary. Lin, everyone in the league knows your abilities. When you first took over Boston, it was a mess, and then you built a four-peat team, profitable year after year. Many people think you're even better than Pat Riley. We're here today because we genuinely want to learn from you and get some guidance."
Lin Qi swirled the ice in his glass, a faint smile playing on his lips as he looked at the two managers in front of him, who were as anxious as ants on a hot pan.