Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: We are joined now by Danny Wurtz, chairman and CEO
Speaker 2: of the Chicago Blackhawks, alongside Michael Ryans. We're a president
Speaker 2: and CEO of the Chicago Bulls. They are both here
Speaker 2: with us on set in Chicago. Welcome to you both.
Speaker 2: Thank you so much for being Yes, it is a
Speaker 2: power table.
Speaker 1: That's so sure about that?
Speaker 2: I don't know indeed, Well, obviously it's a big week
Speaker 2: for you guys. I'm sure one that has had probably
Speaker 2: a year or so of preparation leading up to it. Michael,
Speaker 2: if we could just start with you talk to us
Speaker 2: about the decision to host this convention at the United
Speaker 2: Center and what all has gone into it and whether
Speaker 2: or not this is the most lucrative thing you could
Speaker 2: have done with a building of itself.
Speaker 3: Well, I mean, clearly, it's not the most lucrative thing
Speaker 3: we could do, because we've shut down our buildings since
Speaker 3: the end of our season, so we've had no we
Speaker 3: haven't booked any events for the last couple of months.
Speaker 3: But to us, this was kind of a no brainer
Speaker 3: when Governor Pritzker and Mayor Lifefoot came to us. We're
Speaker 3: on board from the very beginning we had the convention
Speaker 3: kind of kicked off. I think that a lot of
Speaker 3: the redevelopment on the West Side in ninety six, So
Speaker 3: the United Centers opened up in nineteen ninety four. This's
Speaker 3: our thirtieth year, and the ninety six convention was a
Speaker 3: complete success. And now it's many years later and we
Speaker 3: want to do our part of supporting the city of
Speaker 3: Chicago that we love so much.
Speaker 4: Fascinating, I'm really taken by the logistics behind something of
Speaker 4: this scale. You can throw a concert, you can host
Speaker 4: a game, but this is on a much larger level.
Speaker 4: You have fifty thousand people attending, and I'm just curious
Speaker 4: what goes into that type of a transformation.
Speaker 1: Tremendous planning.
Speaker 5: And the good thing is our team kind of at
Speaker 5: the United Center are used to these, you know, one
Speaker 5: hundred and fifty nights a year working games, concerts, et cetera,
Speaker 5: big events like All Star Games. But this is another level,
Speaker 5: and I know our team at the United Center kind
Speaker 5: of liked the challenge of really rising to the occasion.
Speaker 1: And then of course it's partnerships.
Speaker 5: It's partnerships with all the city as sees and all
Speaker 5: the people that have to make it all work, and
Speaker 5: it's an impressive experience to go walk through and just
Speaker 5: walking through last night and see all the pieces come
Speaker 5: together to make the event.
Speaker 6: Is it public service?
Speaker 1: Though?
Speaker 4: Also Kailee references the fact that you could be making
Speaker 4: a lot more money doing something else.
Speaker 5: Yeah, I think it's kind of in our DNA to
Speaker 5: step up and to do the right thing for the city,
Speaker 5: because when the city does well, we do well as
Speaker 5: a business. And these conventions are big opportunities to put
Speaker 5: the spotlight on our great city, to showcase what we
Speaker 5: do so well, and to bring people and bring business
Speaker 5: to Chicago.
Speaker 2: Well, as we think about the work you're doing in Chicago,
Speaker 2: obviously you announced a few weeks ago, as Tyler mentioned,
Speaker 2: the nineteen oh one project, you're investing more than seven
Speaker 2: billion dollars to reva basically the area where now the
Speaker 2: area that surrounds the United Center. How do you fund that?
Speaker 2: As we're having a conversation here about money.
Speaker 1: Well, we're going to fund it privately.
Speaker 3: You know, We're lucky because the United Center is kind
Speaker 3: of the anchor tenant, so we have a chance to
Speaker 3: redevelop the land, the parking lots, when we opened the building,
Speaker 3: we had six thousand parking spaces available, and we.
Speaker 1: Never we didn't want to make it a sea of parking.
Speaker 3: But what happened with a lot of people bought parking,
Speaker 3: you know, bacon lots and made additional parking, so we
Speaker 3: actually became kind of a sea of parking. And now
Speaker 3: we have this opportunity to reimagine this neighborhood.
Speaker 1: It's not We're not Danny, I've talked.
Speaker 3: This isn't It is not an entertainment district that you
Speaker 3: see in a lot of other cities with their buildings,
Speaker 3: their arenas and stadiums. This is an opportunity to do
Speaker 3: something different for the West Side. So it will be
Speaker 3: privately financed, and you know we're talking, we're talking a
Speaker 3: lot of development, whether it's we're building a music hall,
Speaker 3: we're building hotels, affordable housing, open park space. I mean,
Speaker 3: it's it's kind of like Chicago's West Side. It's it's
Speaker 3: their time, it's our time.
Speaker 4: There's a big conversation about crime in this campaign that
Speaker 4: you hear a lot about. I'm sure the former president
Speaker 4: Donald Trump has been criticizing Chica of using crime statistics
Speaker 4: in some of his speeches, and.
Speaker 6: We have to acknowledge the reality of the matter.
Speaker 4: But when you consider an investment of that scale and
Speaker 4: you look at the geography, is it.
Speaker 6: You build it and they will come.
Speaker 4: The timing is what I'm curious about considering the backdrop
Speaker 4: of your investment here when it comes to crime in Chicago.
Speaker 3: Well, we have a long term view, Danny. How long
Speaker 3: has your family been been.
Speaker 5: Here for almost one hundred years and tell you, you know,
Speaker 5: crime has always been something that we've had to contend
Speaker 5: with and work with. But we also know that when
Speaker 5: when we invest in the neighborhoods and when you invest
Speaker 5: in economic development, that is one way to help create
Speaker 5: opportunities that gets to sort of the root cause.
Speaker 1: Of some of the crime issues you see today. So
Speaker 1: I think.
Speaker 5: Chicago has a history of really rolling up our sleeves
Speaker 5: and trying to be part of the solution, try to partner,
Speaker 5: you know, with the public sector to figure out how
Speaker 5: do we how do we create those opportunities to help,
Speaker 5: you know, stem some of those.
Speaker 1: Problems from violence. Yeah, you have to understand one thing.
Speaker 3: When the Unite Center opened, there was no one went
Speaker 3: west of the business dissuest yes and units are open.
Speaker 3: Ninety four, Mayor Daly wanted to bring the Convention to
Speaker 3: make up for what happened in sixty eight. Ninety six
Speaker 3: convention went off perfectly, and then all the developments started happening.
Speaker 3: I don't think Fulton Market, which is just to the
Speaker 3: east of US, I don't think that naturally happens without
Speaker 3: the Uniteds that are kickstarting all this. So for us,
Speaker 3: we're not worried about the timing.
Speaker 1: We think the timing is right right now.
Speaker 2: Well, the timing for having the public cooperation with investing
Speaker 2: in things like stadiums, as we've seen evidence by say
Speaker 2: the Chicago Bears for example, doesn't seem to be great.
Speaker 2: There's been a lot of pushback in that. And I
Speaker 2: know you just said that you're planning to finance this privately,
Speaker 2: But what do you think about the dynamic surrounding the
Speaker 2: financing mechanism of these investments into sports facilities of Frinkley
Speaker 2: the facilities around them. If, as you say, this is
Speaker 2: about helping to invest economically that could help with things.
Speaker 5: Like crime, I think every situation is very different. Every
Speaker 5: you know, wherever you're looking to do your development has
Speaker 5: different opportunities, and I think it is that partnership, you know,
Speaker 5: with the public to figure out where that benefit lies.
Speaker 5: We know in our situation, you know, we own our land.
Speaker 5: We've owned our land for a long time. We've been
Speaker 5: part of this community for almost one hundred years. So
Speaker 5: you have a good feel of what the neighborhood needs,
Speaker 5: how to find those nice trade offs and those important
Speaker 5: trade offs between our commerce and what we need from
Speaker 5: the community, and then you build it together. I think
Speaker 5: other developments are going to obviously are putting that more
Speaker 5: at the forefront than ever before.
Speaker 4: When you consider public private partnership and just the role
Speaker 4: that you play in this city. You're no strangers to politics,
Speaker 4: which is what we talk about every day here on
Speaker 4: this program. Are politics making it more difficult to do
Speaker 4: business or the conduit for your success?
Speaker 3: I mean, for us, I think that there seems to
Speaker 3: be a lot of interest in our development. When we
Speaker 3: went to the Mayor's office, we talked to people you
Speaker 3: know that surround him, all the men, Walter Burnett, everyone
Speaker 3: seemed to be on board. Like to me, this was
Speaker 3: almost like a no brainer. You have a group of
Speaker 3: people that want to spend seven billion dollars.
Speaker 4: They might want to take that meeting. Yea, his relationships
Speaker 4: are long and important.
Speaker 1: To you, of course. I mean we have.
Speaker 3: You know, we have friendships going back many many years.
Speaker 3: Now we have a new mayor here who just became
Speaker 3: mayor of last year, and we're developing a relationship with him.
Speaker 3: But like I said earlier, our families go back a
Speaker 3: long long time. We're about Chicago, not about the politics.
Speaker 1: It's what can we do to make Chicago a better place.
Speaker 2: Well, a lot of the politics today, or at least
Speaker 2: the political issues that seem to be dominating in there,
Speaker 2: certainly we're seeing this week and in this election surround
Speaker 2: the economy as well. We've seen such a change in
Speaker 2: the economy over the last four years from the pandemic,
Speaker 2: which obviously shut down facilities like the United Center for
Speaker 2: an extended period of time, to this resurgence and demand
Speaker 2: for that experience. People wanted to go to live events
Speaker 2: like sports games and concerts. Now we're all asking this
Speaker 2: question of whether or not the softening is finally upon
Speaker 2: us in the labor market and potentially in consumption as
Speaker 2: a result. Are you seeing any any signs of that
Speaker 2: in a waning of demand ers, there's still demand to
Speaker 2: go I think for two expensive things.
Speaker 5: For sports entertainment, I think it seems like every year
Speaker 5: is bigger than the last year. I think we had
Speaker 5: a record year for other events outside of our two
Speaker 5: teams last season. We obviously here across the board, Lollapalooza
Speaker 5: had record attendance this year for live music and festivals.
Speaker 5: So again, I think that desire to be connected, that
Speaker 5: desire for experience and people willing to pay for it
Speaker 5: is still there. So at least in that part of
Speaker 5: the business, for sure, we see some nice tailwinds. Whereas
Speaker 5: you know, other parts of the business, I definitely see
Speaker 5: some of those.
Speaker 3: I think it's helped that in the music industry changed
Speaker 3: so much over the years that before putting out albums,
Speaker 3: it was really made the money. Now it's touring, so
Speaker 3: now you have all these acts, and so every year
Speaker 3: it seems like we're getting more and more acts. And
Speaker 3: how many different concerts did we do last year? I mean,
Speaker 3: I think we're almost eighty different content. It's kind of crazy.
Speaker 3: So now we're building this music hall, which is a
Speaker 3: six thousand seat venue, and that's going to get some
Speaker 3: of the smaller acts, and we don't see.
Speaker 5: A softening right now, and especially in the markets like Chicago,
Speaker 5: which seems to be able to absorb a tremendous amount
Speaker 5: of live events and entertainment.
Speaker 3: Sure, Chicago, Yah, Chicago loves the sports. So we feel
Speaker 3: pretty good about where we're at here.
Speaker 4: But it's an interesting take that you have just broadly
Speaker 4: beyond even spending on events, sports and concerts, you don't
Speaker 4: see a consumer prepared to slow down or more wary
Speaker 4: about conditions.
Speaker 1: I think.
Speaker 3: I think what we see is that you better make
Speaker 3: sure that you are delivering a special experience from the
Speaker 3: time that someone gets into the car or takes the
Speaker 3: train or takes the ride sharing to you know, get
Speaker 3: parking the car, owing the building, getting their food, getting
Speaker 3: their drinks. We better make sure that it is a
Speaker 3: top quality experience. And that's some of the biggest challenges
Speaker 3: we have because we don't control the traffic, we don't
Speaker 3: control certain things. We don't control when it's a blizzard
Speaker 3: in the middle of winter. Probably one of the great
Speaker 3: things about this DNC is that it's in the summer
Speaker 3: right about that, not here in the winter.
Speaker 2: I have to say, the weather right now is certainly preferable.
Speaker 1: We ordered up for you guys yeah, thank you.
Speaker 2: I want to ask as well, because something we just
Speaker 2: saw happen in Washington last year was the purchase of
Speaker 2: a sports team for a pretty rich valuation in the Commanders.
Speaker 2: We've seen the valuations seem to go up in general,
Speaker 2: and I wonder if you think this is something that
Speaker 2: is sustainable. How you're considering your own valuation for the
Speaker 2: black Hawks at this time, if you've been having any
Speaker 2: conversations with private equity about these kind of things, can
Speaker 2: you just shed some light on.
Speaker 5: That, Danny, I'm fourth generation owner of our family, I think,
Speaker 5: one of the longest contiguous owners of a major sports
Speaker 5: franchise in all sports, and enough for us, it's something
Speaker 5: we just hold really dear to our family. So we're
Speaker 5: sort of in a very unique situation from an ownership standpoint, which,
Speaker 5: of course the interests in these very coveted licenses are
Speaker 5: driving those values up. So we love the valuation, but
Speaker 5: it doesn't necessarily change our strategy to continue to hold
Speaker 5: and develop and grow our family asset for another few generations.
Speaker 3: And what about for the Bulls, for the Bulls, I
Speaker 3: mean for the Chicago Bulls, who why would we want
Speaker 3: to get out of being part of the Chicago Bulls.
Speaker 3: I mean we were the first, probably the first global
Speaker 3: sports franchise in the world, thanks to Michael Jordan. So
Speaker 3: for our family and for our investors, our partners, we're
Speaker 3: not interested in being a seller. Is it nice that
Speaker 3: the valuations of these teams are going up. Sure, but
Speaker 3: at the same time we're not going to realize any
Speaker 3: of that because it's the Bulls aren't going anywhere.
Speaker 4: Well, we have another big sports deal in Washington, d C.
Speaker 4: And that was Ted Leonsen's teams deciding to stay in
Speaker 4: Washington and a massive deal to kind of.
Speaker 6: Rebuild the neighborhood.
Speaker 4: He talked to us about the challenges of moving buildings,
Speaker 4: changing spaces that allow people to flow into a new
Speaker 4: area that they might not be going to otherwise. You're
Speaker 4: facing something similar here when you've got a river in
Speaker 4: the way, You've got a couple of things. How do
Speaker 4: you envision this project in western Chicago in a way
Speaker 4: that will actually.
Speaker 6: Bring the flow of people to Europe.
Speaker 5: I actually think the hardest part was thirty years ago,
Speaker 5: as Michael said, you know, crossing that threshold to come
Speaker 5: to the West Side to see an event, and you
Speaker 5: know over seventy years.
Speaker 1: You know, people got used to coming to the Chicago.
Speaker 5: Stadium, but it didn't offer a lot on the way
Speaker 5: where we're at now. The growth happening on the west
Speaker 5: side of Chicago is tremendous. Full Market is the most
Speaker 5: explosive neighborhood in the city of Chicago. That's right at
Speaker 5: our doorstep. The growth of the Illinois Medical District just
Speaker 5: south of us. So there's momentum here and there's a
Speaker 5: lot of other things happening around this development that I
Speaker 5: think gave us the confidence that the energy is and
Speaker 5: the energies here and the infrastructures in the infrastructure. Now,
Speaker 5: that's an area where I think I think the city
Speaker 5: is very interested in really understanding what the infrastructure needs
Speaker 5: are to make sure we can continue to bring people
Speaker 5: here through the various forms of transportation that we have
Speaker 5: all the things we need for this to be continued
Speaker 5: by our neighborhood.
Speaker 4: What a treat to have this much time. Thank you
Speaker 4: both for being so generous, A great conversation here. Yeah,
Speaker 4: this is why we came to Chicago's Denny Words Michael Reinstorff.
Speaker 4: Great to see both of you, and thank you for
Speaker 4: being with US on balance of power, Bloomberg TV and Radio.
Speaker 4: We are live from Chicago, day two of the Democratic
Speaker 4: National Convention,