On July 27, 1986, it was announced that the committee chose the Magic to be the new name of the Orlando franchise in the NBA. The Magic were one of the four new expansion franchises awarded by the NBA along with the Charlotte Hornets, Miami Heat and Minnesota Timberwolves. Initially, the NBA was planning to expand by three teams, with one franchise going to Florida; however, when both Miami and Orlando ownership groups made successful pitches, the expansion committee decided to expand by four teams, allowing both to have a franchise. The Magic became the first ever major-league professional sports franchise in the Orlando area, led by William DuPont III, joined with two brothers, James and Robert Hewitt, as general partners and former Philadelphia 76ers general manager Pat Williams. The expansion fee was reportedly $32.5 million.
The Magic hired Matt Guokas as the team's first coach, who helped the Magic select twelve players in the NBA Expansion Draft on June 15, 1989. On June 27, 1989, the Magic chose Nick Anderson with the 11th pick in the first round, which became the first draft pick of the franchise. The first game the Magic played on November 4, 1989, at the Orlando Arena against the visiting New Jersey Nets, who won 111- 106 in a hard-fought game. The Magic's first victory came two days later, as the Magic defeated the New York Knicks 118110 in Orlando. The inaugural team compiled a record of 1864 with players including Reggie Theus, Scott Skiles, Terry Catledge, Sam Vincent, Otis Smith, and Jerry Reynolds. The Magic history was changed on May 17, 1992, when the franchise won the first pick in the 1992 NBA Draft Lottery. The Magic selected big-man Shaquille O'Neal from Louisiana State University, the biggest prize in the draft since the Knicks won Patrick Ewing. O'Neal, a 7-foot 1 inch center, made an immediate impact on the Magic, leading the club to a 4141 record. The Magic again became the NBA's most improved franchise, as they improved by 20 games. O'Neal was the first rookie to be voted an All-Star starter since Michael Jordan in 1985. He also became the 1992-1993 NBA Rookie of the Year. Despite Shaquille O'Neal's presence, the Magic missed the 1993 NBA Playoffs because they were tied with the Indiana Pacers for the eighth and final playoff spot in the Eastern Conference with the Pacers holding the tiebreaker. In the 1995-96 season, the Magic again were near the top of the Eastern Conference and the Atlantic Division with a 6022 record, led by O'Neal and Hardaway; however, the Magic were seeded number two, behind the NBA all-time best 72-10 record of the Chicago Bulls. In the meantime, General Manager Pat Williams was promoted to Senior Executive Vice President and replaced by the Vice President of Basketball Operations John Gabriel on April 29, 1996. In the playoffs, after the Magic defeated the Detroit Pistons and the Atlanta Hawks, Orlando met the Bulls in the Eastern Conference finals. The combination of Jordan, Scottie Pippen and rebounder Dennis Rodman was too much for the Magic, and Orlando was swept 4-0 in the Eastern Conference finals. Since all the Playoff appearances Orlando Magic Tickets have slipped in value but with the new resurgence of energy the Magic will soon find their way back to glory.