All of Dolphins owner Stephen Ross’ actions have strongly suggested that he wants to keep the team in his family long-term, even as he watches his team flounder at 1-6 and even as he continues a 16-year struggle to put a winning product on the field.
Ross, 85, has rejected overtures from hedge fund billionaire Ken Griffin; designated his daughter Jennifer as his successor and has given a significant role to son-in-law Dan Sillman, an experienced sports executive who is married to Ross’ daughter, Kim.
But even if Ross changed his mind and decided to sell majority interest in the franchise, there would deterrents because of tax law.
In the past two years, Ross rejected a $10 billion offer from an unidentified buyer to purchase the team, Hard Rock Stadium and the Miami Grand Prix. Griffin reportedly has made two attempts to purchase the Dolphins.
NFL franchises have continued to appreciate in value; the sport remains wildly popular and billions in television revenue have helped owners reap massive returns on their investments.
Over 2008 and 2009, Ross paid $1.1 billion to H. Wayne Huizenga to buy 95 percent interest in the Dolphins and the stadium. Last year, he sold a 13% stake in the team, the stadium, Miami Grand Prix, and the Miami Open tennis tournament, in a transaction that reportedly generated $1.05 billion for Ross.
Of that 13 percent, private equity firm Ares bought 10% and Brooklyn Nets owner Joe Tsai purchased 3% percent.
So let’s say Ross hypothetically were to sell his remaining $84.5 percent stake of the team and Hard Rock Stadium for $10 billion. That means a nearly $9 billion gain over what he paid Huizenga, and he would owe more than $1 billion in capital gains taxes based on last year’s total valuation of $8.1 billion.
Selling 13 percent last year likely cost Ross more than $150 million in capital gains taxes, though many adjustments and variables can impact those numbers.
If Ross were to pass away as owner of the team and his family then sold the team, they would avoid the $1 billion-plus in capital gains taxes because the IRS gives special treatment to appreciated assets when someone dies.
But in this scenario, his family would get hit with an estate tax, potentially of more than $2.5 billion, according to an official who has worked on sports transactions. The family would need to pay that tax regardless of whether the franchise was sold to an outside buyer, after Ross’ death, or simply passed on to his daughter, Jennifer. Those taxes typically must be paid within nine months of death.
So continuing to own the team makes financial sense for Ross.
Beyond that, indications are that Ross’ family is receptive to owning and running the team at some point. Jennifer Ross reportedly also owns a piece of the team.
Sillman - identified in his Wikipedia page as a sports executive, entrepreneur and film producer - has emerged as a prominent figure in the Dolphins’ future.
Since 2017, he has been the CEO of Ross-owned Relevent Sports, a global sports and entertainment company that represents commercial rights for European soccer leagues. The company is part of a larger portfolio of assets that includes the Dolphins, Hard Rock Stadium, and other real estate and media businesses.
Sillman, who was born in 1989, studied finance at the Ross School of Business at the University of Michigan and started his own firm, Compass Management Group, which offered financial services to athletes and entertainers. Among his previous clients: Longtime Eagles defensive lineman Brandon Graham.
After selling Compass in 2014, Sillman joined RSE Ventures, a private investment firm owned by Ross. He helped bring the iconic Barcelona-Real Madrid game to Hard Rock Stadium in 2017, marking the first time those teams played against each other on U.S. soil.
As CEO of Relevent, Sillman has transitioned the business from a live events company to a global commercial rights property for soccer.
Forbes included Sillman on its 2018 “30 Under 30” list of influential people in various industries, and Sports Business Journal recognized him on its “Forty Under 40” list in 2019 and again in 2022.
Sillman, a longtime business partner of Golden State Warriors forward Draymond Green, is a member of the FIFA World Cup’s Miami Host Committee Board of Directors.
Long-term, Sillman is positioned to run the team with his sister-in-law, Jennifer. In October 2022, Ross notified the NFL that he was changing his successor, as the team’s managing general partner, from Bruce Beal to his daughter Jennifer.
Two months before that, the NFL disciplined Ross and Beal for “tampering violations of unprecedented scope and severity,” resulting from the team pursuing coach Sean Payton and quarterback Tom Brady.
Ross was suspended for two months and fined $1.5 million, while Beal was fined $500,000 and suspended from league meetings for the remainder of the 2022 season. The league also took away the Dolphins’ 2023 first-round pick and a third-rounder in 2024. Even before Beal’s misstep, Ross reportedly planned to make Jennifer his successor, though Ross has never confirmed that publicly and has spoken to reporters only once this decade (when Mike McDaniel was hired as coach in February 2022).
Ross is the NFL’s seventh-richest sports owner, with a net worth of $17 billion, according to Forbes.
He has been praised for his philanthropy and for privately financing $755 million in improvements to Hard Rock Stadium. Ross, Sillman and team president Tom Garfinkel have been instrumental in helping lure big events to the stadium, including seven World Cup games next summer, Super Bowl LIV in 2020, the Miami Open tennis tournament, Formula 1 Miami Grand Prix, this season’s College Football Playoff championship game and high-profile concerts including Taylor Swift’s Eras Tour.
But the Dolphins have made the postseason only three times and haven’t won a playoff game during Ross’ 16 years as majority owner.
For now, Ross continues to stand by coach Mike McDaniel and general manager Chris Grier. A business associate said he entered this season wanting to give both men an extended period to see if they could get the franchise back on track after last year’s step back, from 11-7 to 8-9.
The team’s poor start has not changed that approach. But his patience is being tested.
A coaching change after Sunday’s game in Atlanta (1 p.m., CBS-4) would seem unlikely, because the Dolphins play again five days later, on Oct. 30, against Baltimore. But the nine-day break between the Ravens game, and a Nov. 9 home game against Buffalo, would give Ross time to re-evaluate if the Dolphins keep losing.