Game Changer: How Billionaire Jeff Vinik is Helping to Remake Tampa
May 17, 2017
Craig Guillot | Chief Executive magazine
From the 25th floor of the SunTrust building in downtown Tampa, Jeff Vinik scans the city streets below and says he sees “tremendous potential.” That’s a big accolade coming from a man who previously lived in Boston and New York and who made investors billions of dollars by finding value. Vinik says the Florida city is poised for such growth that most people won’t even recognize it in 10 years.
“Sitting in this office, looking out that window, you’re going to see another 30 or 40 high-rises,” he says. “It is going to be bustling…. We’ve got all the potential in the world down here.”
Since buying the Tampa Bay Lightning, the city’s professional hockey team, in 2010 (and its arena football team, the Tampa Bay Storm, a year later), the former mutual fund manager has invested hundreds of millions of his own dollars in the region. In recent years, he moved beyond the ice to become one of the area’s biggest players and philanthropists. Vinik’s latest endeavor, a $3 billion live-work-play development, is one of the largest of its kind in the state and is positioned to transform the urban core of one of the country’s fastest-growing cities.
At 57, Vinik is living proof that executives can reinvent themselves at any age. Whether as a fund manager, sports team owner or developer, Vinik says he has always been driven by passion and intellectual curiosity. And while his latest endeavors may just be a form of fun, they’re having a tremendous impact.
Building a City from the Ground Up
Just outside of Amalie Arena, where the Lightning play, Vinik is spearheading one of the biggest new urban developments in Florida. Not long after buying the Lightning, Vinik started scooping up prime real estate near the arena. In 2014, he acquired the 719-room Tampa Marriott Waterside Hotel & Marina and the Channelside Bay Plaza entertainment complex.
The project is being developed by Strategic Property Partners, a partnership between Vinik and Cascade Investment, a holding and investment company controlled by Bill Gates, and currently encompasses 53 acres of land along the Tampa Bay waterfront in and around the Channelside District.
Within five to 10 years, SPP is projecting 9 million square feet of development with 5,000 new residences, 650 hotel rooms and 2.6 million square feet of office space. Already infrastructure and street work is under way in preparation for a massive revitalization of the southern end of downtown Tampa. Phase 1 is scheduled to break ground in late 2018.
Vinik’s vision is a live-work-play development that will include residences, hotels, a medical school, an entertainment complex, retail space and, hopefully, a major corporate headquarters. In 2015, he added to his team city planner and national new-urbanism proponent Jeff Speck, who says that walkable cities and more carefully designed urban areas can prove to be not only more sustainable but also more economically successful.
Vinik’s development is also aiming to achieve WELL Certification from the International Well Building Institute, which would make it the first community in the world to receive the designation, which indicates that work and living environments address seven areas thought to significantly impact health and wellness: air, water, nourishment, light, fitness, comfort and mind.
Vinik says he’s using the area as a “blank canvas” to rebuild a development that is uniquely Tampa. It’s an ambitious effort for a city that hasn’t built an office tower in 24 years. Vinik says he originally had “no plan to build half a city in downtown Tampa” and that the idea evolved over time with the nationwide trend of movement back to urban cores. The goal is to now create an “ecosystem” that will attract millennials from outside the region with high-paying jobs that can spark further economic growth.
While cities frequently unveil ambitious projects, they often fall apart due to lack of funding or will. With the backing of Vinik and Cascade Investment, those two elements are already secured.
“It just comes down to passion. As you get older, you do what you want to do, right?” Vinik says. “There’s just an incredible opportunity to build a vibrant, walkable, amenity-rich, mixed-use development here. We can really make a difference.”
Fund Manager to Sports Team Owner
The married father of four took an unlikely path to the role of real estate developer. In the early and mid-’90s, he managed the Fidelity Magellan Fund, then the world’s largest mutual fund with more than $56 billion in assets in 4.4 million accounts. He stepped down in 1996 and later started his own hedge fund, Vinik Asset Management, to serve select institutional and private clients.
Vinik came to Tampa in 2010 when he purchased the Tampa Bay Lightning for a price tag that ESPN estimated at $170 million. There were nearly 10 teams for sale at the time, but Vinik picked Tampa for what he saw as “underappreciated” potential.
The purchase raised some eyebrows, with some speculating it was just a financial investment for the out-of-state multimillionaire. Vinik, however, says his foray into sports was “for fun” and that he had a long-term commitment to the community. “It’s just really underappreciated and undervalued. I really thought there was an opportunity for myself and my family here, in conjunction with the community, to hopefully make this an even better place and better city,” he explains.
Seven years later, it’s hard to dispute his intentions. Lightning fans and management credit him with turning around the team’s performance and profitability. When he took ownership, he immediately cleaned house and brought in Detroit Red Wings legend Steve Yzerman as GM. He also invested $71 million of his own money in Amalie Arena, making it one of the most state-of-theart arenas in the nation.
The team went from having one of the worst records in the NHL to making the playoffs the past three seasons. ESPN.com readers voted the Lightning at the top of its Ultimate Standings 2016, which ranked 122 professional sports teams on things like ownership, coaching, players, affordability and stadium experience.
As the sole owner of the team, Vinik doesn’t have to worry about other interests or partners. He manages his current projects the same way he’s managed billions of dollars for investors, perhaps just with a bit more passion and personal interest. Vinik didn’t retire when he left the fund industry, he started a whole new career.
“You say, ‘What would be the most fun on a day-to-day basis?’ And I tell you, there’s nothing more fun than owning a hockey team and trying to rebuild half a city,” says Vinik. Leading with Knowledge and Strategy Vinik’s second act as sports team owner and developer may be just “fun” for him, but it’s serious business in Tampa. From the new development and the turnaround of the Lightning to the millions in charitable donations, the ripple effect of his presence is felt throughout the region.
Craig J. Richard, president and CEO of the Tampa Hillsborough Economic Development Corporation, says Vinik cares deeply about the future of the community and is a great ambassador in national recruiting efforts. “Jeff’s vision for city building and community engagement has helped take Tampa to a whole new level,” says Richard.
With no previous experience in sports management or real estate, Vinik says a key to his success has been hiring the right people. Unlike in the investment business, where he was a hands-on manager, his goal as an owner is to “set the tone” on the values of the organization and let others lead with specialized knowledge and experience.
Executives who work for him say he gives them what they need yet has a hands-off approach to day-to-day management. Vinik says he finds great leadership and “gives them the resources to be successful, not meddle in what they’re doing, and then holds them accountable at the end of the day.” He’s extremely patient and methodical in finding the right talent.
SPP President and CEO James Nozar says he had roughly 20 touch points with Vinik before he was hired. As a self-proclaimed “knowledge consumer,” Vinik is a prolific reader. When he started his quest to buy a hockey team, he spent nearly 10 hours a day for three months reading everything he could about sports business and ownership. He even read the collective bargaining agreement of the National Hockey League multiple times. “Anything that I get involved with, I try to immerse myself in the field and learn everything I can,” he says.
Jim O’Connell, CEO of his charitable organization, Vinik Family Foundation, describes Vinik’s management style as “intellectual curiosity-driven leadership.” The former fund manager’s latest deep immersion is urban development.
There’s often a pile of neatly pressed, bound reports stacked on his desk, and, on a typical day, Vinik is in back-to-back meetings with his chief executives and partners from 10 a.m. to 7 p.m. Most of these take place at a small conference table in his personal office.
From transportation and entrepreneurial incubators to the cost of the rents and marketing strategy, Vinik has insight into all aspects of the development. He enjoys continually shifting course during the day between philanthropy, hockey and urban development. At one meeting, Vinik and Nozar jumped straight into an evaluation of potential partners and consultants for the Channelside project. A few hours later, O’Connell updated him on ideas for charitable donations.
Later that evening, Vinik watched the Lightning play from his personal suite. Vinik may provide guidance, solicit updates and have a final say, but it’s clear that he has strong confidence and faith in his executives.
While Vinik has a strong sense of confidence and expects the best, he also leverages losses as learning experiences, something he ties back to youth sports where he “learned how to lose.” Recently, the SPP team thought they had a tenant of nearly 300,000 square feet of an office building before the deal fell through.
After a couple of glasses of wine that night, Vinik went back to the office the next morning and straight back to work. “Out in the investment field, I’ve lost thousands of times, made thousands of mistakes in my life…. That’s the way it goes,” he says. “There are ups and downs, but you try to keep your eye on the long-term objectives…. and just keep moving in that direction.”
Sincerity and a Desire to Boost Tampa
Transitioning from fund manager to sports team owner and developer has taken Vinik from his cherished private life into the spotlight. His management style may be the same, but he says becoming a public figure has been a big change. A relatively reserved man who doesn’t showboat his success, Vinik describes himself as a “quiet leader” who solidifies his leadership by respect earned through relationships and sincerity. He has been known to try to talk to everyone who works in the arena and makes employees feel welcome while also reminding them of their mission.
“I think leadership is just subtle in taking advantage of opportunities to hopefully send nuanced messages that make people want to run through walls for you, and for each other, more importantly,” says
Vinik. Vinik’s corner office, which reflects his personality and leadership style, is functional and surprisingly ordinary for a man of his stature. There aren’t any self-glamorizing photos of him with dignitaries or trophies, beyond a football helmet, a basketball from his alma mater, Duke University, and a 1993 Fund Manager of the Year Award from Morningstar. Waist-high file cabinets wrap around the perimeter, and his desk holds two large monitors, a smartphone and a stack of reports. Framed in one corner are the “Ten Commandments” of Vinik Asset Management. Those guiding principles include “Have an edge,” “Limit greed” and “Respect risk—live to fight another day.”
Since his arrival in Tampa, Vinik’s charitable giving has been legendary. In 2011, Vinik and his wife, Penny, introduced the Lightning Community Hero program, which identifies and donates $50,000 to a local charity for every home game. It has since donated more than $11 million to 400 different nonprofits in the Greater Tampa Bay area.
At a game against the Edmonton Oilers in late February, for example, Vinik handed a $50,000 check to Peter Watkins, a Vietnam War veteran and founder of the New Horizons Group Home that serves developmentally disabled adults. The two men spent time in a locker room talking about how the money would be used, while Watkins’ family looked on. From the elevator operators in Amalie Arena to the fans, there’s a deep respect and appreciation for Vinik. Tampa Bay Lightning President and CEO Steve Griggs says Vinik is the only owner for whom he has seen fans wearing a jersey with his name on it.
In 2015, the couple committed $6 million to expand youth hockey in the area with the Build the Thunder campaign, and last year they gave $2.5 million to the Boys and Girls Club of Tampa Bay to renovate a recreation center. “My wife and I have tried to be charitable throughout our lives, and owning the team has really allowed us to give back and participate in the community,” he says.
Last year, he hired two twenty-something Rhodes Scholars to lead his charitable foundation. O’Connell says Vinik is very methodical about how he donates his money. Jeff and Penny Vinik want to ensure they’re making an impact not just in the immediate term but 20 or 30 years from now.
O’Connell and Meredith Wheeler, VFF’s senior policy analyst, have been tasked with doing a 360-degree assessment of how the fund should deploy its resources. Yet Vinik knows that beyond his charitable giving, his development project in downtown Tampa has the potential to spur development across the entire city, far surpassing the millions he has already donated. He says there’s an immense feeling of satisfaction from being able to use hockey, philanthropy and now urban development to create what he calls a “rising tide to lift all boats.”
“We want to benefit the entire community economically and quality of life-wise,” he says. “We hope it’s a rising tide that will help everyone.”