Pro Athletes Turn Into Real Estate Investors As They Get Past ‘Shut Up And Dribble’
Dallas Cowboys offensive lineman William Sweet joined the National Football League as an unoccupied rookie from the University of North Carolina and was awarded a squad spot with the Arizona Cardinals in 2019. Before ever playing in a regular season game, he found himself out the year with a ligament injury.
The injury gave him time to realize that a lucrative professional sports career can end at any time, even as a man in his early 20s. So he started investing in real estate.
Courtesy William Sweet
Dallas Cowboys battled William Sweet on a recent visit to NASA.
“That opened my eyes,” said Sweet, 23, who made his NFL debut with the Dallas Cowboys last year. “I wanted it to last forever. How can I make this last forever? Business was my way out. “
Sweet now owns six single-family rentals in his hometown of Jacksonville, Fla., Through his company Sweet Ventures, and plans to own more than two dozen in the coming years.
Sweet is a member of a new class of professional athletes jumping into real estate looking to follow in the footsteps of famous athletes to make a name for themselves in the industry. Roger Staubach, Emmitt Smith, Magic Johnson, Shaquille O’Neal, David Robinson, and Alex Rodriguez are greats at their sport, each with millions invested in commercial real estate.
While superstars make headlines, middle-class professional athletes are still taking home millions in salaries each year and are increasingly moving beyond passive commercial real estate investments to get more active in the industry before their season ends.
“Everyone is not as lucky as Tom Brady,” said Sweet of the now seven-time Super Bowl champion. “I think a lot of people think that it will take forever. When that time comes they are living in the past and just trying to catch up, essentially because the game will be over and a lot of people are still trying to figure things out. “
Sweet made just over $ 500,000 in salaries in two seasons, according to NFL contract tracking site Over The Cap, and signed a $ 1.5 million deal with the Cowboys over the next two years.
“The ultimate goal for me was that I could have a long life with or without football,” he said.
Sweet said more of his NFL peers are asking his advice on investing in real estate because they realize the money they make playing will last. The average length of a professional NFL career is just over three years.
Alexis Johnson founded the Legends Investment Network in 2019 to target athletes like Sweet. The company trains and connects professional athletes and celebrities who are interested in investing and getting involved in commercial real estate and alternative investments. Since its inception, Legends has grown to 82 members, most of whom are current and former NFL players.
A big reason for the growing interest in real estate was the coronavirus pandemic, she said. When bans broke, sports teams, professional musicians and artists lost money and advertising revenue dried up.
“This loss of revenue affects everyone, including the players,” she said.
Anthony Tolliver in 2011 when he played with the Minnesota Timberwolves.
Anthony Tolliver, a 12-year veteran of the National Basketball Association, develops and invests through Say U Can LLC, which recently completed two student housing projects in his home state of Missouri. Tolliver, who has played for 10 teams and is currently a free agent, said more than 30 of his former NBA teammates have invested in real estate, including Kevin Durant, Robert Covington and Garrett Temple.
During the three years that Tolliver was teammates at the Sacramento Kings with two-time All-Star Zach Randolph, the two spoke frequently about real estate investments on the court. Today Randolph is one of Tolliver’s co-investors in Say U Can’s 55+ year old Black Rock multi-family community in Nixa, Missouri.
“You see 90% of the most successful people in the world, 97% of them will say, ‘Yeah, I have a huge amount of real estate,” said Tolliver, who earned an NBA salary of $ 34.5 million in his career According to Sports Earnings Tracker Spotrac, “Real estate is a great tool, especially for us who have made good money in a short amount of time and want to put some of it away and put us in a position to be successful over the long term.”
The interest of the athletes continues to grow, especially since the average salary has risen these days. While there is still a large profit gap between superstars and other players, more and more people are seeing real estate as a good investment to safeguard their weak earnings.
“Unless you have a $ 20 million contract … you are not set for life,” said Philip Michael, a commercial real estate investor who raises donations from athletes for sale in real estate.
Michael and his nephew, FC Barcelona professional footballer Martin Braithwaite, founded NYCE Cos., Which launched a $ 1 million seed fund for non-accredited investors, including some athletes. The company also has a controlling interest in a $ 500 million portfolio of 1,500 residential units and LYND, Texas. (Disclosure: Michael is a former employee of Bisnow.)
“I think from my conversations with different people [athletes] I just want to make smarter decisions with the money, ”said Michael. “People think beyond their game days.”
Tolliver said some of his colleagues were inspired by professional athletes who turned themselves into business moguls, like LeBron James and the late Kobe Bryant, who invested in Bodyarmor SuperDrink, set up a media studio and venture capital fund focusing on technology and games and apps.
“I would actually say [the growing interest in investing] is more of a by-product of making it cool, ”said Tolliver.
Baron Davis played three seasons with the Los Angeles Clippers.
Baron Davis was the third pick in UCLA’s 1999 NBA Draft and was an All-Star by age 22. His early basketball fame motivated him to build a nest egg – buying up a portfolio of commercial residential real estate – long before his 13-year NBA career ended in 2012 and raised $ 147.2 million from his NBA contracts alone.
“I spend most of my time with technology, films and creativity. When I started my career, it was really about having a nice real estate portfolio that generated dividends, ”Davis said in an interview with Bisnow this week. “Now I can take bigger bites because I know I have a nice solid foundation.”
Davis was a serial entrepreneur and entertainer under the Baron Davis Enterprises umbrella, invested in Vitaminwater, founded the Black Santa Co., and produced numerous films and documentaries.
Davis said his next steps could bring him back to his investing roots, with larger commercial real estate projects in Los Angeles and possibly Atlanta.
“We looked around and said, ‘How do we take care of our church? How do we get athletes to invest in them? ‘”, He said. “And real estate is the key.”
Former Atlanta Hawks striker Josh Childress said he was inspired to move into commercial real estate at Stanford University when he saw all of the money billionaire John Arrillaga had given the university, including funding scholarships for the basketball players.
“My understanding of success was based on the fact that this guy was able to make an impact and enable a kid like me to come to Stanford, and he did that through real estate,” Childress said during a webinar dated by Legends network was organized. “I said, ‘I want to do this.'”
Childress, who spent eight years in the NBA over a 15-year professional basketball career, is now CEO of Los Angeles-based Landspire Group, which invests in multi-family, residential and industrial projects in underserved parts of Orange County, California.
“We’d love it [professional athletes] investing with us, ”said Childress. “There are certain abilities that are translated and correlated in both worlds.”
JT Thomas, an eight-year-old NFL linebacker who last played with the New York Giants, said athletes, especially black professional athletes, have a responsibility to lead by example in the commercial real estate industry.
“[It’s] One of the biggest problems with commercial real estate is access to capital, ”said Thomas, who earned an NFL salary of over $ 9.3 million over the course of his career and now owns a handful of rental homes with family members. Thomas said he is currently working on plans to create a real estate fund aimed at accredited investors.
“Going to the annual Commercial Finance Institute meeting in Miami and only seeing a handful of black people … that’s very instructive. But it only fascinates me more and only forces me to be in the industry myself, ”said Thomas. “It is a great responsibility to be the gateway or to expose more minority commercial real estate.”
Michael said he and Braithwaite had similar goals with the NYCE funds.
“People of color, especially black people, there is no culture of saving. It’s a culture of consumption, ”he said. “And that’s exactly what drives the wealth gap. That’s the main thing I wanted to address. There are people who have never invested before. The breakthrough paradigm shift happens as soon as you start investing. “
Athletes are also getting more involved in the industry because of the earlier perception that they were unable to operate commercial real estate, Tolliver said. Nothing drives a world-class athlete like the doubts of others.
“We have now set a precedent as athletes. It was always said: “Shut up and dribble.” The athletes have just finished that, ”said Tolliver. “We can not only have opinions, but also be successful. We have the ability to be successful real estate agents or technology investors. “
“I know this is part of why I’m so interested in the business,” he added. “Just like the odds are against you in the NBA, so are the odds against you of doing well in business. I have exceeded odds all my life. “