McNair’s Dare

The billionaire who is bringing NFL football back to Houston like horses, charity, and taking chances.

The billionaire who is bringing NFL football back to Houston likes horses, charity, and taking chances. Bob McNair looks serenely happy. No, that doesn’t quite describe him. He looks transcendently happy, standing in the hot, late-summer sun on a stage that has been constructed in the middle of a street in downtown Houston, surrounded by hundreds of adoring fans who are waiting for the formal unveiling of their brand-new hometown football team, the Houston Texans. At this moment, in September 2000, McNair, who is the majority owner, chairman, and CEO of this new NFL franchise, is very likely the most beloved man in Houston. He is wearing a blue “ NFL 2002” polo shirt, signifying the year the Texans will play their first game, and sipping from a bottle of water. He is approached by fans who tell him how wonderful he is. “Thank you, Bob,” they say, with a sort of breathless gratitude. Others shout, with deep sincerity, “Bob, you’re the best!” At this moment, it is good to be Bob McNair.

Now he steps forward to the microphone. “I don’t have to ask you,” he says, flashing a knowing smile, “but are you ready for some football?”

They are. Oh, how they are ready for some pro football in Houston. They have been dying for it ever since Bud Adams, in a fit of pique because the city of Houston wouldn’t build him a new stadium, up and moved the Houston Oilers to Tennessee in 1997 and renamed them the Titans, as though to wash away any memory of the old Oilers and all the glory days of Bum Philips and Earl Campbell and Dan Pastorini and Warren Moon. The 63-year-old McNair has made a career out of taking big risks. And now he has taken another one by putting up an eye-popping $700 million for the new franchise. It is a bet many observers feel is his riskiest yet.

That’s just fine with him. The Texas transplant has made a career out of taking chances. Born on New Year’s Day in 1937 in Tampa, Florida, he was brought up in what he describes as a lower-middle-class family in Forest City, North Carolina. His passion was playing sports. In high school he was a three-sport athlete, and when he graduated, the Chicago Cubs offered him a professional contract. He turned it down to go to the University of South Carolina on an academic scholarship. In college he played basketball but quit after his freshman year. “I decided that once I could play at that level, I sort of had obtained my goal,” he said. “I knew I wasn’t going to play professional basketball.”

McNair couldn’t seem to make up his mind about academics either. He started out studying civil engineering but later switched to liberal arts, earning a bachelor of science degree in psychology while working a series of jobs, including waiting tables, sacking groceries, and selling insurance. After graduation, he went to work for a friend at an automobile-and-equipment-leasing company. Five months later the company went broke, and the newly married McNair suddenly found himself unemployed. So he headed to Houston to start his own auto-leasing business. All he had was $700 in his pocket and the promise of a $3,000 loan from a former employer.

Over the next twenty years, McNair built the company into a substantial business, which included truck and equipment leasing as well. But he did it on a shoestring, with few cash reserves, and when deregulation hit the trucking industry in the early eighties, creating stiff competition and lower rates, he was forced to declare bankruptcy. It was a dark period for McNair, but it taught him an important lesson. “I worked for twenty-some years with no capital, so I never had any liquidity,” he says. “Managing my loans alone wouldn’t do it, and working hard twenty-four hours a day seven days a week alone wouldn’t do it. You have to be properly capitalized.”

You also have to have a good idea. In 1984 McNair started a company called Cogen Technologies on the simple but remarkable premise that he could build plants that would generate power more cheaply than utilities could. It turned out to be an extremely good idea. Over the next fourteen years he built five electricity facilities around the country, mostly in the northeast. Cogen became the largest privately held power company in the country. McNair got rich. When an expansion-minded Enron came knocking at his door in 1998, McNair got obscenely rich, selling three power plants in New Jersey to the energy giant for $1. 4 billion. He kept the other two, which were (and are) also hugely valuable.

Awash in cash and having failed at a halfhearted attempt at retirement, McNair soon found himself swept up in the pursuit of a new NFL franchise for Houston. It wasn’t totally out of the blue: In the early nineties he had looked at buying the Miami Dolphins after owner Joe Robbie died, and he had considered buying the St. Louis Cardinals after the team lost its principal backer. But in the end he did not bid on either team. So when John J. Moores, the wealthy founder of Houston-based BMC Software and the owner of the San Diego Padres, stepped out of the race to win Houston the next NFL team, McNair suited up. “I guess it was more of a civic responsibility I felt to pursue it,” he says. “I thought I was in a better position to get a team than anyone else in Houston.”

It was a long shot: Los Angeles was the favorite, with real estate magnate Ed Roski and Hollywood superagent Michael Ovitz behind two separate bids for a new team. Though the process dragged on for two and a half years, McNair hung in there, lobbying hard for the team. He established relationships with officials at the NFL (Adams had introduced him to NFL commissioner Paul Tagliabue at an Oilers game in 1992), members of the NFL expansion committee, and the

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