The best way to look at the value of an NFL team is the way you look at the value of your home. If you bought a home in 1990 for $100K, it might be worth $300K now. You don’t see that $200K from the increase in the value of the house until you actually sell it. Same thing with an NFL team. In 1990, the Lions were worth maybe $100M, now, according to Forbes, they are worth $2.1B. The $2B increase in the value of the business won’t be seen in terms of cash until it’s sold.
According to Forbes, the Lions received $411M in revenue for their last fiscal year, of that amount they paid $250M in player expenses (salary cap and benefits) and another $118M in operating costs (admin/coaches/scouting/practice facility/etc). They had $43M in operating income and out of that amount, they have to pay interest, taxes and loan payments. Which is probably in excess of $43M in net cash that they took in from operations. Over the years, I’m positive that the Ford Family has had to put more money into the Detroit Lions than they have taken out. They have seen the value of the franchise increase significantly, which makes owning an NFL team very profitable, but that’s not cash that is available for use . . . until it’s actually sold.
I get every bit of that. I have to make repairs on my house to make sure the value doesn’t diminish. So the costs for the Lions are basically home improvement loans. It’s why the NFL is all about checking the finances of all potential franchise buyers to make sure they are in fact able to sustain the product. If I put new windows in my house I only get about 50% of the cost back in the first year if I’m going to sell . But, in 5 years that cost has gone up substantially and I have saved on energy costs in the meantime. I understand how this works. Unlike a home though, when you sell an NFL team, you don’t have to replace it with another NFL team. Thanks for the numbers.
Guys on NFLR were talking 176-178 million next year, went on to say it will create a bunch on stars switching teams. That was debated for the next 3 hours
