Credit: Stephen J. Serio
Danny Wirtz listens to his father Rocky during a 2019 interview with Crain's about the 25th anniversary of the United Center.
July 31, 2023 05:46 AM
Danny Wirtz will take his father Rocky’s titles as chairman and president of Wirtz Corp. as the fourth generation of the family that owns the Chicago Blackhawks suddenly takes leadership of a sprawling and closely held business worth billions.
The Wirtz Corp. board approved the succession Saturday morning even as Danny and others continued to plan services to honor Rocky Wirtz, who died unexpectedly July 25 at age 70.
A brief July 29 letter to shareholders confirmed the news. “The board has full confidence that Danny is well-prepared to excel as the next-generation leader of Wirtz Corp.,” the letter said.
Rocky’s passing was more shocking and unforeseen than that of his father, William, in 2007. Still, the family feels Danny, 46, is more prepared than Rocky was at the point he took over, even though he was in his mid-50s. Rocky gave Danny more responsibility in a broader array of family businesses than Rocky had experienced when his turn came, according to Guy Chipparoni, who worked closely with Rocky over many years, helping handle communications for a family that plays an important role in Chicago’s business and civic scene but also prizes privacy.
Chipparoni likened Danny’s apprenticeship over the past decade to a co-pilot in a plane that Rocky was flying. At times, Danny would fly the aircraft himself. By contrast, Rocky had experience only with Wirtz Corp.’s liquor business when his father died, forcing him to learn on the job, particularly regarding the hockey team. “Rocky had to figure out where the plane was,” Chipparoni said.
MORE: Danny Wirtz was a member of Crain's 40 Under 40 class of 2016
Danny inherits leadership of a company that includes one of the nation’s largest liquor distributors, a portfolio of vintage apartment buildings all over Chicago and a small bank in the Chicago suburbs, as well as the Blackhawks and co-ownership of the United Center on the West Side. The surprising timing of his ascension coincides with the beginnings of a ground-up rebuild of the Blackhawks and ambitious, long-term real estate development plans uncharacteristic of a family that for decades treated its real estate empire as a cash cow.
Helping matters is that, unlike 16 years ago when Rocky took over a moribund Blackhawks organization with no experience owning a pro franchise, Danny has been CEO of the team since 2020. Rocky’s 16-year run heading the family business featured a revival of the Blackhawks and a merger of the Wirtz liquor franchise with a larger player that ceded complete family control of that to become a bigger player in the industry.
Rocky’s younger cousin, Arthur Wirtz III, will play an important role going forward as well. Arthur, 55, is on the Wirtz Corp. board and is a senior executive with Breakthru Beverage Group, the liquor business.
No matter how well Danny is prepared, being the undisputed boss is different than being a higher-up. The burden of representing the next generation adds to it.
Speaking generally about businesses owned and run by wealthy families and the challenges when a new generation takes over, Leigh Rocklin, lead faculty for Loyola University’s Next Generation Leadership Institute, says it’s not easy to be a successor.
“You are born into a story already being told,” she says. “That’s not my quote, but it’s a quote we use often. . . . It’s hard to be born into a story and to discover who you are.”
At a Crain’s event just four months ago, Rocky Wirtz spoke about the future and the plan to keep Wirtz Corp. a family-owned enterprise.
Chairman:
Danny Wirtz, 46. President of Wirtz Corp.
Family directors:
Bruce Wirtz MacArthur, 75, Rocky’s cousin, former chairman, First National Bank of South Miami.
Arthur M. Wirtz III, 55, Rocky’s cousin, executive vice president, Breakthru Beverage Group.
Hillary M. Wirtz, 44, Rocky’s daughter, Danny’s sister. Director of diversity and inclusion, Breakthru Beverage Group.
Outside directors:
Nadine Heidrich, 69, retired chief financial officer, Wirtz Corp.
John Miller, CEO, 69, CEO of Rellim Capital Management and co-chairman of business service and products provider Envoy Solutions.
Jeffrey Vender, 74, former anesthesiology department chairman, NorthShore University Health System.
“My grandfather had great faith that future generations of Wirtzes were going to be able to progress the business, and fortunately, we're still in business,” he said. “I think the key thing is, you have to have leadership. You can't sit down and say, ‘When I pass away, what's going to happen?’ So we have figured that out.”
When Rocky Wirtz addressed the audience at the Crain’s event in March, the succession plan he alluded to was perceived as a long way off. “I'm not going anywhere. I'm still chairman,” he said. “But,” he added, referring to his decision three years ago to put Danny in charge of the hockey team, “I said (to him), ‘I'm here to help you, and I'm here to work with you any way I can.’ We've got to bring young people in. You just can't hold onto something for the rest of your life.”
It’s one thing to have a succession plan. It’s another to execute it, particularly in the potentially fraught setting of any family accustomed to generational wealth. Personal issues and unhappiness over how assets are distributed can derail leadership blueprints that seemed settled. Just ask the Pritzkers.
There’s no sign of that kind of fractiousness looming here.
But the Wirtz family has a history of disagreement in the immediate aftermath of generational change. In 2010, less than three years after Rocky’s ascendancy, his brother Peter and sisters Gail Wirtz Costello, Karen Wirtz Fitz and Alison Wirtz sued him over a family-owned beer distributorship in Nevada and Minnesota. The case was settled, but not before a run through court on an issue that a spokesman for Rocky said “could have been simply resolved around a table,” The New York Times reported at the time.
Apart from the Blackhawks, for which the Wirtzes are best known, the two big businesses are liquor and real estate.
The booze distribution business — one of the largest in the country, operating in 14 states — is expected to suffer little if any disruption. Rocky Wirtz was co-chairman along with Charles Merinoff, whose New York-based Charmer Sunbelt Group merged with Wirtz Beverage Group in 2015 to create Breakthru. Danny Wirtz is vice chairman, and Arthur Wirtz is executive vice president in charge of operations, as well as a board member. The company hired former National Restaurant Association chief Tom Bene, as CEO in 2021. Merinoff didn’t respond to a request for comment.
It’s real estate where question marks loom. Rocky Wirtz was more deeply involved in that business in recent years. The family’s holdings are best known for their half-ownership of the United Center on Chicago’s West Side alongside the family of Chicago Bulls owner Jerry Reinsdorf.
Much of the family’s real estate holdings trace back to Arthur Wirtz, Rocky’s grandfather, who acquired apartment buildings throughout Chicago at discounts after the 1929 stock market crash as he began building the empire. For decades, those buildings were a source of steady cash, and the family did little but collect rents.
“We had everything through real estate,” Rocky said during the Crain's event of his family's business origins, noting that the only reason his grandfather got into professional sports was because he “bought the tenant” of its Chicago Stadium property.
Since 2014, the manager of the Wirtz real estate portfolio has been Don Vitek, who joined the company after a 16-year run with developer Draper & Kramer. Rocky's death comes amid recent moves to shrink the vintage portfolio.
Wirtz Residential last year sold five apartment buildings totaling 164 units in Evanston and unloaded several apartment properties in 2020 and 2021 on Chicago's North Side, including a 75-unit property in Lincoln Square and an 81-unit building in Rogers Park.
The family still owns around 1,200 apartment units elsewhere on the city's North Side and a vintage office tower at 333 N. Michigan Ave., along with its United Center interest. Vitek also oversaw Wirtz's ground-up apartment development at 2950 N. Sheridan Road in Lakeview, a 20-story, 82-unit building that debuted in 2017.
That Sheridan Road development, a rarity for Wirtz, merely foreshadowed Rocky’s far larger development ambitions. He led the family's recent plan to develop some 700 acres of farmland it owns in Lake County into a master-planned community, dubbed Ivanhoe Village, with a town center with locally run shops, a mix of residential development an array of nearby amenities. Not everyone in the clan was on board, Rocky acknowledged.
Asked at the Crain’s event in March how some of his family members reacted to his vision for the family farm, he said some worried they'd lose the privacy of their sprawling family getaway. “I don't think they can get their arms around it yet. They'll get there. But with all due respect, they don't have the votes,” he said with a smile.
How his “votes” transfer, and how those who now hold them respond, raise questions about the future of that ambitious development that only the family will be able to answer.
Danny is committed to continuing the Ivanhoe development, Chipparoni said.
Additionally, the Blackhawks recently proposed a $65 million expansion to roughly double the size of the team's Fifth Third Arena community ice rink just south of the United Center and sought zoning rights from the city of Chicago to eventually build as many as 1,200 residential units and 663 hotel rooms next to the facility.
“We're trying to make it into more of a campus,” Wirtz said during the Crain's event. He estimated that while it cost roughly $180 million to build the United Center itself in the early 1990s, he and Reinsdorf spent another $600 million since then on new practice facilities nearby and arena expansion and upgrades. Danny also will see that through, Chipparoni said.
Asked that day about his legacy, Wirtz spoke of his aspirations that his kids, including Danny and his daughter, Hillary, build on what he and the rest of the Wirtz family have built.
“I always believed in trying to make the next generation of the Wirtz family better business (people) than I am. If I've done that, I've done my job,” he said.
Yet Rocky demonstrated his firm grip on the Wirtz family baton over the past couple years, even as he took steps toward passing it to his children. The struggle was on full display during a public town hall event in February 2022, when Danny was asked by a reporter about changes the team was making after issuing a report in late 2021 with disturbing details about how it mishandled sexual assault allegations against a former team video coach in 2010 — a scandal that resulted in a confidential but undoubtedly costly settlement between the team and plaintiff Kyle Beach.
When Danny began to answer — ready to speak as the chief executive of a franchise trying to move on from a dark period in its history — Rocky cut him off and castigated the reporter for asking about it, part of a viral tirade that ripped the scab off a healing wound for the franchise. Though Rocky later apologized for the outburst, it illustrated a struggle to relinquish his role as the public face of the franchise and raised questions about who would determine the team's path forward.
It was three years before that jarring moment when Rocky and Danny appeared at a separate Crain’s event alongside Jerry Reinsdorf and Michael Reinsdorf — Jerry's son and the Bulls' president — during an in-depth discussion about the United Center, which then was turning 25 years old.
What should the leadership of the facility look like after the next 25 years, Rocky was asked.
“Someone from the Wirtz family and someone from the Reinsdorf family,” Rocky said. “That's what's nice about it. It's a true joint venture and the spirit of it is, we always work together to make each franchise better and the building better.”
Rocky and Danny were on the same page during that 2019 discussion about future improvements at the arena. It would be Danny, Rocky said, who would spearhead efforts like adding a sportsbook at the venue, which has since been built out and is awaiting a license from the Illinois Gaming Board.
Perhaps unintentionally providing something like a Wirtz business philosophy, “As Dad says, figure it out,” Danny said then.
Rocky quickly followed: “On my tombstone, (it's) going to be: Just figure it out.”
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