By BRIAN LEWIS
Anybody that has even a passing interest in MLS finances should check out solid piece in Forbes, which has finally put values to the league’s teams. Solid reporting, and intriguing stuff.
The highlights: After Seattle and Philadelphia anteed up and kicked in $30 million each in expansion fees _ three times what Toronto FC paid three years ago _ commissioner Don Garber says the next two expansion clubs will cost $40 million.
Forbes says three teams are already worth more than that, with the Galaxy leading the way at $100 million, Kansas City bringing up the rear at $22 million and the average club (not including San Jose) sitting at $37 million.
Spurred by David Beckham, the Galaxy’s operating income of $4.0 million topped the league, and their revenue of $36 million more than doubled the next closest team (Toronto, second in value at $44 million, revenue at $17 million and profit at $2.1 million).
Chicago was third in value and revenue, but since the Fire share revenues from parking, premium seating and ticket sales in exchange for $98 million of public financing to build Toyota Park, they took a $3.1 millon loss. The Red Bulls were the fifth-most valuable team at $36 million, despite below-average revenue of of $10 million _ $3 million under the MLS average _ and operating at a $4.5 million loss. Forbes rated Houston at $33 million but the Dynamo went for $45 million after Philip Anschutz sold half to Brenner International and Golden Boy Promotions. (Oscar De la Hoya’s group estimated clubs will be worth $80-100 million in three years. In essence, Forbes was bullish on MLS while the rest of the economy is going down the tubes. Guess it’s a growth stock, huh?
Forbes said league’s teams posted an operating loss of $20 million on profits of $165 million.
SUM pulled in $23 million from national TV deals but paid each team just $1 million, meaning they need to make money on local TV, sponsorships and in their stadiums. The Galaxy and Toronto hit home runs there, the latter making $4 million in local TV and sponsorships.
And what kind of impact exactly should we expect from Red Bull Arena? Well, Real Salt Lake expects revenues to jump from $7.6 million to $20.3 million next year in its stadium full-time, and Forbes predicts the Red Bulls to make a similar leap.