SBD/October 17, 2012/Leagues and Governing Bodies

Timbers Owner Paulson Says MLS Franchise Fees Will Continue To Rise

Paulson says owners who bought in earlier did "heavy lifting" for franchise valuations
MLS Timbers Owner Merritt Paulson said that the league’s franchise fees will “continue to rise as interest in the sport grows in North America," according to Tariq Panja of BLOOMBERG NEWS. Paulson said, “The last team, in Montreal, went for $40 million. You’re going to see a really big increase on the next team coming in. That’s just a product of the league coming in and growing. The people who got in on much lower valuations paved the way and did a lot of the heavy lifting in terms of getting the league to where the franchise valuations could be where they are.” Panja noted Chivas USA, Real Salt Lake and Toronto FC “each paid $10 million to join in 2004 and 2005.” The fee “jumped to $30 million for the Seattle Sounders in 2007.” Paulson said that “buying into the MLS is a business decision as much as a sporting one.” He said, “The league’s done a very good job in managing costs. There are multiple teams in the league that are cash flow positive including us” (BLOOMBERG NEWS, 10/16).

CAMPAIGN SEASON
: In N.Y., Chris Bragg wrote, “In its effort to build a $300 million soccer stadium in Queens, Major League Soccer is playing to win.” Records show that "between March and June, MLS spent more than $612,000 on a slew of prominent New York City lobbying firms to handle various elements of the effort." The targets of the lobbying efforts "include local community boards, the City Council, the Economic Development Corp. and Mayor Michael Bloomberg.” Included in that amount was “$464,000 to HR&A Advisors, a real estate and economic development consulting firm.” A source said that much of what was paid to HR&A “was not for only lobbying but also for more technical aspects of the project” (CRAINSNEWYORK.com, 10/15).
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