SBD/January 25, 2013/Franchises

Knicks Leapfrog Lakers As NBA's Most Valuable Team In Latest Forbes Survey

The average NBA team is worth $509M, "a 30% increase over last year," according to Kurt Badenhausen of FORBES.com. The increase is "due to higher revenue from television, new and renovated arenas, and the NBA’s new collective-bargaining agreement, which reduced player costs from 57% of revenues to roughly 50%." The labor deal also "increased the amount of money high-revenue teams provide low-revenue teams." The Knicks are the league’s "most valuable team," worth $1.1B, "reclaiming the crown" from the Lakers, who topped last year’s list. The Knicks‘ value rose 41%, mainly due to a $980M renovation of Madison Square Garden "that is expected to be completed this summer." The makeover "resulted in an NBA-leading" $243M in revenue last season. The Knicks‘ operating income of $83M was the "highest in the league for a third straight year." The team's "better play" is another factor, as the Knicks in '12 "won a playoff game for the first time" in 11 years. The outlook for the NBA "is strong, with stars" like Heat F LeBron James and Thunder F Kevin Durant in their "prime and formerly weak franchises revitalized in the big markets of New York (Nets) and Los Angeles (Clippers)" (FORBES.com, 1/23).

RANK
TEAM
VALUE
RANK
TEAM
VALUE
1
Knicks
$1.1B
16
Cavaliers
$434M
2
Lakers
$1.0B
17
Jazz
$432M
3
Bulls
$800M
18
Clippers
$430M
4
Celtics
$730M
19
Nuggets
$427M
5
Mavericks
$685M
20
76ers
$418M
6
Heat
$625M
21
Raptors
$405M
7
Rockets
$568M
22
Pistons
$400M
8
Warriors
$555M
23
Wizards
$397M
9
Nets
$530M
24
Pacers
$383M
10
Spurs
$527M
25
Grizzlies
$377M
11
Kings
$525M
26
T'Wolves
$364M
12
Thunder
$475M
27
Hornets
$340M
13
Suns
$474M
28
Hawks
$316M
14
Magic
$470M
29
Bobcats
$315M
15
Trail Blazers
$457M
30
Bucks
$312M

VALUES DON'T MATTER: In Dallas, Eddie Sefko noted the Mavericks at $685M are valued at $400M more than what Owner Mark Cuban paid for them in '00. The Mavericks had a net operating income of $13M, "which is only the second time in Cuban’s ownership that the team turned a profit." The other season was '01-02, when the magazine said the Mavericks made $3M. But Cuban said, "It only matters if you sell, which I have no plans to do." Forbes before last season had "pegged the losses during Cuban’s ownership" at $180M (DALLASNEWS.com, 1/23). Meanwhile, T'Wolves Owner Glen Taylor paid $88M for the team 18 years ago, but he said of the team's new valuation, "It doesn't make any difference to me what they say. It's what I negotiate that will count" (ST. PAUL PIONEER PRESS, 1/25).

POT OF GOLD: FORBES.com's Tom Van Riper wrote the Celtics after 10 "years and hundreds of millions in added value" under Managing Partner Wyc Grousbeck are "primed to be flipped." But Grousbeck and Managing Partner Steve Pagliuca "insist that their team isn't for sale." Grousbeck is "clearly a fan, one who discusses draft picks and all-star selections as easily as his latest cable deal with Comcast." He "delights in marketing the team, a powerhouse brand that he snapped up during a dormant period, to his fellow New Englanders." The Celtics are "making a bundle," generating an estimated $19M in operating profit on revenues of some $143M last year versus the league averages of $12M and $123M. And they are "doing it without owning the building they play in." Grousbeck recently said he turned down a "ridiculous number" for the Celtics. Grousbeck "won’t say on the record and won’t disclose who made the offer." But if it had "worked out, he insists, it would have dwarfed the $360 million he and a group of investors," including Pagliuca, paid for the team in '02 (FORBES.com, 1/23).
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