By Tarik El-Bashir and Thomas Heath
Washington Post Staff Writers
Friday, June 11, 2010; D01
The Washington Wizards will not only have a new owner next season, they'll also have a familiar star in the back court.
Ted Leonsis was introduced as the Wizards' majority owner on Thursday, taking full control of a sports empire that also includes the Capitals, the Mystics and Verizon Center. And one of the first questions he answered was about the future of point guard Gilbert Arenas, whom the NBA suspended in January for the remainder of the season after he brought guns into the locker room.
"I think it's very important that Gilbert be re-embraced as a person and as a player," Leonsis said of Arenas, who is owed $80 million over the remaining four years of his contract. "His major deliverable is to come back and be a great part of this next-generation Wizard franchise and what we're trying to accomplish."
Leonsis also confirmed that he's been in contact with Arenas recently, adding, "What I feel comfortable with is that we communicate very well. And I kinda liked him. . . . So I think we're going to be okay."
The update on Arenas's status was just a small part of a long-awaited day for Leonsis, who also announced a new name for his ownership group; told the assembled media that the Wizards won't change their name but might switch uniforms; and outlined his long- and short-term goals for a struggling franchise that is coming off a 26-56 season but owns the first overall pick in this month's draft.
In an effort to "give a visible sign of change" to the way things are run on F Street, Leonsis said, he christened his $825 million sports empire Monumental Sports & Entertainment. The newly named ownership group merges Leonsis's Lincoln Holdings with the late Abe Pollin's Washington Sports & Entertainment, which had controlled the majority of the Wizards and Verizon Center.
Leonsis said he would not change the Wizards' name, but the blue, white and gold uniforms that have long been a source of frustration for fans might see a return to the red, white and blue uniforms the team wore when it was known as the Bullets.
"It's no secret I am partial to red," Leonsis said. "We all saw the change in the Capitals' uniform and how it was galvanizing."
Leonsis acknowledged that transforming the Wizards into a contender will not take superficial change but rather drafting and development, much like the blueprint that saw the Capitals ascend from the bottom of the NHL to the first place in the league last season. He also said he does not plan to hand out huge free agent contracts, despite having approximately $20 million in cap space and the temptation of a deep market this summer.
"The money is not burning a hole in my pocket," Leonsis said. "I do see smart free agent signings. I do see astute trades. . . . Maybe 10 years ago, I would have been firing up the jets. [But] we're experienced owners right now and we don't want to go after any free agent that we don't think we can get just to make the news."
Leonsis twice made reference to Ernie Grunfeld, which would seem to indicate that the general manager will remain in charge of the Wizards' front office, though the owner never directly addressed the subject.
Leonsis did announce a new management team Thursday. He has appointed investor and Proxicom founder Raul Fernandez and Black Entertainment Television co-founder Sheila Johnson, both investors in Monumental, as vice chairmen. Dick Patrick will remain president of the Capitals and will become vice chairman and chief operating officer. Leonsis is Monumental's chairman.
He also introduced two investors who helped his ownership group purchase the 56 percent of the Wizards and Verizon Center that Leonsis did not control. SWaN Investors, headed by Fred Schaufeld, and Scott Brickman, owner of the Brickman Group landscaping firm, have joined Monumental, whose members also include Capital One Chairman Richard Fairbank.
Ownership control of Verizon Center allows Leonsis to start directing arena revenue to his hockey team, which has been losing money for years. The Capitals received no revenue from the arena's estimated 108 luxury suites and 3,000 club seats, which had been controlled by Pollin's estate.
Leonsis said the value on Verizon Center and the Wizards together is about $550 million.
In addition to the Capitals and Mystics, he also owns the local Ticketmaster franchise and the management contract for George Mason University's Patriot Center. He manages the Capitals' Ballston practice facility, Kettler Capitals Iceplex, and he controls media rights for the teams' radio and television broadcasts.
The exact cost to Leonsis is clouded by a number of factors, including $250 million in debt on the arena and the Wizards, which Leonsis's group has assumed. After the debt, the net cost to Leonsis for the rest of Pollin's empire was around $170 million, according to sources who spoke on the condition of anonymity because they were not authorized to discuss the deal.
On Thursday, Leonsis briefly acknowledged the personal challenge he'll face in managing his time and energy now that he owns three teams and one of the nation's busiest arenas.
"I do worry about it," he said. "While I owned [the Capitals], I've started many businesses that became very, very successful. I've made movies that have won Emmy awards and Peabody awards. I wrote books. I have high bandwidth. I'm going to stop doing some of those things and put my focus on the teams, because there are only so many hours in the day."