Billionaire Houston Rockets owner acquires nearby Chevrolet dealership. Will he buy more stores?

After a quarter-century of dealing in luxury rides, the billionaire owner of a Texas business empire that includes the NBA's Houston Rockets has shifted into domestic automotive brands with a Chevrolet store acquisition.

Tilman Fertitta, via his newly formed Fertitta Automotive Group, on Sept. 9 purchased Norman Frede Chevrolet in Houston. Longtime owner Norman Frede will retire, according to Fertitta Automotive.

"For me, it's not about the industry as much as it is about the deal, and how it enhances our customers' experience," Fertitta said in a statement to Automotive News. "For this one, it was just the right purchase to further diversify the portfolio and broaden our presence within the automotive industry."

Fertitta's automotive retail roots stretch to 1998 when he founded Post Oak Motor Cars in Houston.

Now part of Fertitta Automotive Group, Post Oak has three luxury dealerships in Houston and The Woodlands, Texas. They feature high-end brands, including Bentley, Rolls-Royce, Bugatti, Karma, Hispano-Suiza and Zenvo. In September, Post Oak announced the launch of an open-point location, Lotus of The Woodlands, marking its first Lotus store.

Lonny Soza, a vice president of Fertitta Automotive, said the group wants to keep growing and that entering the domestic lane allows for expansion opportunities.

"There's only a finite amount of ultraluxury dealerships available to buy, especially in your own backyard," Soza told Automotive News.

Fertitta's portfolio also includes Landry's Inc., the restaurant, hotel, entertainment and gaming empire. The bustling company includes seafood restaurants across the country, hotels and even an aquarium. Golden Nugget Casino also falls under the Landry's label, including the brand's related online gaming apps.

The Houston native purchased the Rockets during the 2017 offseason for $2.2 billion, Fertitta Automotive confirmed. In March, the businessman purchased Houston's River Oaks District, an outdoor luxury shopping and entertainment destination. Fertitta owns more than 600 properties in 38 states and 15 countries.
And now, a Chevrolet dealership.

Blake Fertitta, Tilman's son and another vice president of Fertitta Automotive, said the renamed Fertitta Chevrolet is a natural extension for their business.

"Cars have always been my passion, and we plan to continue to expand our presence within the automotive sector," Blake Fertitta said.

The dealership sits between Houston and Galveston, Texas, near Clear Lake, where Fertitta has restaurant and hospitality locations. Blake Fertitta said the Chevrolet dealership's location was important as was the fact it was family-run.

"To be able to keep that legacy going on and be a part of the community like Norman was in the past was really important to us," he said.

No matter which Fertitta Automotive Group dealership a customer visits, Soza said, the experience should feel the same.

"We feel that we can come into this store with very much the same approach that we operate our luxury brands out of," Soza said. "That's creating more of an experience than a transaction."

The company also takes care of its workers.

All 100 of the Chevrolet dealership's employees are expected to stay on. And an estimated 50,000 people who work for Tilman Fertitta's companies are eligible to purchase a vehicle under the employee purchase program offered at a special rate at all of the group's dealerships. Employees who live near the stores also get deals on service and parts.

Soza said the Chevrolet acquisition provided a "right-time, right-place opportunity for both the seller and us," and that future acquisitions will depend on similar circumstances.

"We certainly have our eyes open, and we're paying attention to what's going on in the market," he said.