MLS' average franchise is now worth $103M, "up more than 175% over the last five years," and with five planned expansion teams and a new league TV deal "on the way, there’s no reason to believe that growth is slowing anytime soon," according to Chris Smith of FORBES.com. Forbes "hasn’t compiled MLS valuations" since '08, and the league "had just 14 teams that season" with the Sounders joining the following year for a $30M expansion fee. The average MLS team then was worth $37M and "losing money." But today, ten of the league's 19 teams "are making a profit," with the Sounders the league's "most valuable franchise at $175 million, a massive 483% increase" over the team's '09 sale price. Meanwhile, of the $26M in revenue the typical MLS team generated in '12, it is estimated over 90% "came from in-stadium revenues like tickets, sponsorships, luxury seating and non-MLS events." Fan support is "key because MLS teams are particularly reliant on revenue at the gate and from sponsors; soccer’s continuous action makes it difficult to sell merchandise and concessions during games." While revenue is "surging, expenses like player costs are heavily controlled." The "new wave of soccer-specific stadiums have increased operations costs, but those are often easily covered with revenues generated from stadium naming rights deals and non-MLS events that teams operate." MLS President & Deputy Commissioner Mark Abbott argues that MLS' current structure is "largely responsible for the league's success" (FORBES.com, 11/20).
|
MLS FRANCHISE VALUES
|
| |
VALUE
|
REVENUE
|
OPERATING INCOME
|
| Sounders |
$175M
|
$48M
|
$18.2M
|
| Galaxy |
$170M
|
$44M
|
$7.8M
|
| Timbers |
$141M
|
$39.1M
|
$9.4M
|
| Dynamo |
$125M
|
$32.6M
|
$8.2M
|
| Toronto FC |
$121M
|
$30.9M
|
$4.5M
|
| Red Bulls |
$114M
|
$28.1M
|
-$6.3M
|
| Sporting K.C. |
$108M
|
$27.7M
|
$5.1M
|
| Fire |
$102M
|
$24.5M
|
-$3.2M
|
| FC Dallas |
$97M
|
$24.2M
|
$0.6M
|
| Impact |
$96M
|
$26.2M
|
$3.4M
|
| Union |
$90M
|
$21.4M
|
$1.1M
|
| Revolution |
$89M
|
$17.1M
|
$2.6M
|
| Whitecaps |
$86M
|
$23.0M
|
$0.0M
|
| Real Salt Lake |
$85M
|
$23.0M
|
-$0.1M
|
| Rapids |
$76M
|
$18.1M
|
-$2.9M
|
| Earthquakes |
$75M
|
$15.0M
|
-$4.5M
|
| Crew |
$73M
|
$18.6M
|
-$1.6M
|
| DC United |
$71M
|
$17.7M
|
-$2.8M
|
| Chivas USA |
$64M
|
$15.0M
|
-$5.5M
|
READING BETWEEN THE LINES: In Philadelphia, Jonathan Tannenwald wrote as MLS has grown, Forbes' evaluation list is "something that a lot of observers have been waiting to see." The Sounders would be expected to be "near the top" of the list, as they "have an enormous fan base, a sponsorship base that includes Microsoft, and a prime downtown stadium location." They also "gain value" from sharing CenturyLink Field and "other resources" with the Seahawks. All of Forbes' figures were measured before the Sounders signed F Clint Dempsey, and that "put a big dent in the Sounders' pocket book." Some Union fans "may find the numbers disheartening." It is "fair to say that" the other pro franchises in Philadelphia "wield more financial clout relative to their respective leagues." Tannenwald wrote he was "surprised" to find the Whitecaps two spots below the Union, as the Whitecaps "have a big fan base, a modern stadium with a perfect downtown location, and strong local and national television deals." The Revolution "plays in a soulless" Gillette Stadium with an "artificial surface in an exurb an hour away from its region's main population center." That they "turn a profit in doing so removes yet another excuse" from team Owner the Kraft family's "refusal to build the team its own stadium in a location that is properly accessible to the thousands of soccer fans in Boston and Cambridge." Meanwhile, sources said that the possible winter schedule MLS is considering adopting is "currently the subject of heated debate within MLS and its clubs." There are "some powerful influences behind closed doors pushing for a change, and they're using the timing of new TV deals to help their cause." But a "majority of clubs in the league are strongly against such a move" (
PHILLY.com, 11/20).
CAPPING IT OFF: In Vancouver, Bruce Constantineau wrote the Whitecaps' owners "were clearly ticked off with the club’s 13th-place finish" in MLS this season, but it is a "good bet they’re a lot happier with the club’s 13th-place standing in the value of league franchises" done by Forbes. The Whitecaps' leasing deal at BC Place has "never been made public but it’s believed the club doesn’t pay a huge rent." One popular rumor is that the Whitecaps "don’t share in parking or concession revenue and pay a rental fee based on a percentage of ticket revenue" -- possibly 15% (VANCOUVERSUN.com, 11/20).
