SBJ/20100823/SBJ In-Depth

Passing the torch

On Sept. 4, Bill Martin will settle into one of the premium seats that he planned at the newly renovated “Big House,” watch his University of Michigan football team play Connecticut, and then clock out for the final time.

It will be a fitting scene from which the Wolverines will send off the man who guided their athletic department the past 10 years. Coming from the private sector as a real estate developer and banker, Martin took a nontraditional route to become Michigan’s AD in 2000, only to rescue one of the proudest and richest athletic programs in the country.

Truth is, he didn’t even want the job, accepting it only after former university President Lee Bollinger and staffers in the athletic department talked him into moving from interim AD and taking the post permanently. He proved to be exactly what the school needed during troubled times.

Martin (left) chats with his successor.

Martin announced his retirement last year and David Brandon, the former Domino’s Pizza CEO, was named as his replacement earlier this year, but Martin has stayed on as a special aide to university President Mary Sue Coleman until his final day on Sept. 4.

His legacy as Michigan’s AD will be his work on facilities, which were called an embarrassment, and the athletic budget, which one insider described as a “financial cesspool” when Martin arrived. His business acumen helped turn a $3 million deficit into a balanced budget in less than two years, and lucrative guaranteed contracts with IMG College and first Nike, then Adidas, have helped U-M’s budget run at a surplus, even as the recession has ravaged that part of the country.

Martin’s real estate background also proved beneficial as he worked from one facility upgrade to another, touching 13 projects at a total cost of $350 million.

And when the Big Ten’s new TV network ran into stormy seas at launch in 2007, Martin, a veteran sailor who helped turn around the U.S. Olympic Committee (see related story, page 25), was integral in keeping the conference’s ADs on board with the venture.

“He was one of the guys that kept everyone’s spirits up,” said Jim Delany, commissioner of the Big Ten. “He’s a true leader. From his business background, he had been around big projects, so he knew the ups and downs along the way. That experience was very beneficial for us at a time when we needed it.”

Martin didn’t get every call right. The jury is out on his most visible hire, football coach Rich Rodriguez, who has been a constant source of controversy since taking the U-M job in 2008. Rodriguez’s buyout from West Virginia became a public mess, and an ongoing NCAA investigation has cast a cloud over the program.

But Martin’s body of work will be rooted in the kinds of things that fans don’t cheer for, like healthy budgets and heady facility planning that brought one of the nation’s elite programs into a new era of athletics.

Tackling tradition

For all of the nuts and bolts work he did to get U-M athletics back on solid ground, Martin will forever be tethered to the $226 million renovation to Michigan Stadium.

Martin’s work on budgets and facility
planning brought Michigan into a new
era of athletics.

It was 2006 when Martin initiated the planning, and the outcry from Michigan’s old guard was deafening. What proved to be Martin’s greatest accomplishment started out cloaked in controversy.

“There was a lot of kicking and screaming,” said Percy Bates, U-M’s faculty athletic representative who has been at the school for 40 years. “I still think there are people around who, even though it’s now completed, are holding on to their old views. That old oval was simply stated, simply done, and it represented Michigan for a lot of people. It wasn’t fancy or glossy, just good.”

A website called savethebighouse.com was born and stories, both locally and nationally, chronicled and often criticized the addition of premium seating. The thought of adding suites and club seats to that old collection of bleacher seats was unimaginable.

“The stadium represented a crossroads for a lot of people; it represented moving into a new era,” Bates said. “But how long can you hang on?”

It was in the face of this firestorm that Martin marched on with his plans.

For $226 million, U-M could bring the stadium into that new era of design with suites that feature granite countertops, flat-panel TVs and leather chairs. The old bowl stadium used to have one elevator. Now it’s got 19.

But Martin also knew the $15 million in new revenue from sales of premium seating would boost the U-M budget for years to come and help secure its future. Sixty-three of the 81 suites are sold and more than 80 percent of the 3,000 club seats have been bought. The remaining inventory represents another $4 million in potential revenue.

“People fear the worst,” Martin said. “I’ve been through this so many times with commercial projects that are close to residential areas. There’s a real fear of change, so you need to work with people. I went around like a politician, talking to alumni groups to show them what we’re going to do. In the real estate development world, I had to go before community groups, planning commissions, historic building commissions. I had 25 years-plus of dealing with approvals. This was not foreign to me.

“People had to understand that the stadium was functionally obsolete. We had safety challenges, we had to improve the handicapped seating, our concourses were too narrow.”

The turning point was a study of season-ticket holders executed by Coldwater Corp., a research and analysis firm in Ann Arbor run by Mary Lukens, a longtime business associate of Martin’s. The study showed that U-M’s key customers weren’t opposed to the premium seating after all. All of the objections were coming from fans who rarely bought tickets.

“When we got the information back, I ran right past his assistant and into Bill’s office to show him the results of the survey,” Lukens said. “His jaw dropped. The people who were the real customers, the ones who buy tickets year after year and leave them in their will, thought the premium seating was great.”

The alternative was to spend $80 million for renovations without adding premium seating. That would have widened the seats, concourses and aisles, and brought the stadium into full compliance with Americans with Disabilities Act guidelines. In the end, however, those changes also would have reduced capacity by about 5,000 seats.

Having the biggest football stadium in the country has always been a point of pride to the Wolverines and Martin wasn’t about to be the AD who reduced capacity.

With the new changes, capacity will be 111,000, keeping the stadium the largest in the nation.

“Listen, I knew I had a steep learning curve when I came in,” Martin said. “I didn’t even know what compliance meant when I started. But there were business challenges surrounding athletics and that’s an area I know.”

“Midas Martin”

Martin’s 10 years at Michigan proved to be a game-changer for the athletic department, but it’s just a stamp in his well-worn passport of business experiences. The Michigan MBA grad was known throughout Ann Arbor for founding First Martin Corp., a highly successful commercial real estate development company, in 1968.

With that company well-rooted in Ann Arbor, Martin took on a new venture in 1995. Turned off by the clumsiness of the national banks in town that lacked any savvy or knowledge of the local market, he co-founded the Bank of Ann Arbor with Peter Fletcher, a longtime friend and business associate. The bank now manages assets of $1 billion and has opened multiple branches in the area.

“I call him ‘Midas Martin’ because everything he touches turns to gold,” said Fletcher, a friend and business associate for close to 30 years. “When he went into the athletic department, the budget was a financial cesspool.

Early into his stint at Michigan, Martin helps break
ground for a new academic center.

“Michigan athletics are very proud that they don’t take subsidies from the university and Bill made sure it was self-supporting. When you walk through campus, you won’t see his name on any buildings and he wouldn’t want it, but it should be.”

One of the reasons Martin was selected to be the interim AD after Tom Goss’ departure (Goss was under pressure from budget problems and an NCAA basketball investigation) was because of his business successes and his stature in the community. He was known for his generosity with local charities and his ability to raise money, which has to be a core competency for an AD.

In the 1980s, when his two children were in school, Martin founded a group called “Citizens for Better Education,” which helped several board of education candidates get elected.

Getting the work done
Highlights of sports facility projects under Bill Martin
Completed projects Regent approval Project budget (millions) Pledged gifts (millions)
Football locker room and event center Nov. 2002 / July 2004 $7.5 $7.1
Academic center March 2003 $12.0 $13.2
Softball stadium Sept. 2005 $5.5 $1.2
Baseball stadium Sept. 2005 $9.0 $8.8
Renovation of Hartwig Administration Building / Ticket office April 2006 $3.5
New field house April 2007 $26.1 $11.6
New soccer fields April 2007 $2.8
Michigan Stadium May 2006 $226.0 $28.0
Wrestling practice facility May 2008 $5.5 $3.4
Projects in progress
Basketball practice facility Jan. 2009 $23.2 $2.0
Soccer Phase 2 May 2009 $6.0 $1.5
Crisler Arena infrastructure, Phase 1 Jan. 2010 $20.0
Golf practice facility May 2010 $2.5 $0.5
Total approved projects $349.6 $77.3
Source: University of Michigan

“Bill never wants anyone to know, he wants no credit, no applause, but he has been so supportive of this community,” Fletcher said. “He’s supported a children’s hospital, local education, police and fire. Right after 9/11 he began a fundraiser to send money to those who had lost a family member in the New York fire or police.”

That business background proved handy as Martin began to tackle some of U-M’s facility problems. Design firm HNTB worked with Martin in the early 2000s to create a master plan for an overhaul of those facilities.

In addition to the changes at Michigan Stadium, Martin initiated a $23 million plan to renovate the aging and dark basketball facility, Crisler Arena. That project has been handed off to Brandon.

Martin didn’t stop with football and basketball. He raised millions more for new baseball, softball and soccer stadiums, as well as practice facilities that are second to none. Golf and wrestling saw improvements as well.

“The facilities were embarrassing. Things were in shambles,” Lukens said

“I know the cost to build things,” Martin said. “I know how to deal with architects. There’s a wonderful old William Cole painting from the 19th century that shows an architect overseeing this vast project. Every time I start a project, I show the architect that painting and say, ‘See this guy with the plans? That’s me, not you. I’ll call the shots.’ I think I just knew how to right-size the projects and keep them financially feasible and consistent with the rest of campus.”

Vision of the future

Bill Martin is no lifer. He never dreamed of being an athletic director and as soon as he thought his work was done — when the changes to Michigan Stadium were completed — he got out.

But he also couldn’t say no when those around him begged him to take the job full time in 2000, even though he had no intention of staying after serving six months as interim AD.

In 1999, after the forced departure of Goss, and with the NCAA breathing down the neck of the basketball program, the Wolverines needed a steadying force. Bollinger, now the president at Columbia University, went to Martin and asked if he would be the school’s interim AD.

OK, Martin said, for six months. Not a day longer. And he wouldn’t accept a paycheck. This is how Martin thought he would give back to the school that sent him on his way to a successful business career.

What he found was an upside-down budget and staff morale that was almost as depressing as the aging, poorly kept buildings that didn’t reflect the prominent reputation of athletics there.

“I was shocked at what I found, frankly,” Martin said. “We had to bring revenues and expenses in line. Letters came into the department from people who said they wouldn’t give because things were in such a mess. People were unhappy.”

Martin began implementing cost-containment measures, he renegotiated the radio contract and eliminated a failed Internet venture that cost the department close to $1 million. He made difficult decisions, such as eliminating senior staff from a top-heavy administration.

“He showed us a vision for what it was going to take,” said Greg Harden, a longtime associate AD at Michigan. “We thought, ‘Here’s a guy who can hold it together.’ He did more than build buildings here; he provided a sense of what it took to sustain an organization and how to plan around that.”

Martin wasn’t completely bereft of athletic knowledge. He had run the U.S. Sailing Association in the late 1980s and early ’90s, and through that national governing body, had taken a seat on the board of the U.S. Olympic Committee.

Unbeknownst to Martin, a petition circulated in the Michigan athletic department and those signatures from staffers and coaches were presented to Bollinger as an appeal to keep Martin in the job permanently. They wanted Martin for the direction he had already set, and they knew his background as a competitive sailor would help lift the profile of Olympic sports on campus. When Martin was told about the petition, he couldn’t tell them no.

“I knew what it was going to take to fix the place, I knew the challenges that were ahead,” Martin said. “It would take a while for a new person to come in and figure it out. I just hated to see us [Michigan] continue like we had.”

Martin was always a Michigan man. He didn’t serve on national committees and he didn’t seek the kind of national profile normally associated with the AD at a program of Michigan’s stature. He just wanted to do what he was hired to do — get the business of Michigan athletics back on track — and return to the private sector. He’ll spend the next several months backing Republican Rick Snyder in a run for governor and, who knows, there might even be a post for Martin if Snyder wins.

“What’s the legacy? I don’t know,” Martin said. “I just ask if I left it in better shape than I found it. I think I did.”

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