Big cable deals, an improved revenue-sharing pact for smaller-market teams and a strike-shortened season helped increase NBA team values by 30% to $509 million.
California’s four teams – the Los Angeles Lakers and Clippers, Golden State Warriors and Sacramento Kings – enjoyed a combined league-beating 35.5% gain over the past year, according to a Forbes magazine report in January. The four teams have a combined value of $2.51 billion, led by the $1 billion tag for the Lakers, the second-richest team, behind only the New York Knicks at $1.1 billion.
The 16-time NBA champion Lakers – led by Kobe Bryant and Dwight Howard — boast the biggest payroll in the league, thanks in part to a 20-year cable deal with Time Warner Cable valued at $3.6 billion. The Lakers had revenue of $197 million, with operating income of $47.8 million – both are the second-best in the NBA.
The Golden State Warriors finished at No. 8, with a value of $555 million, a 23% increase from a year ago. The Bay Area team had revenue of $127 million and operating income of $29.1 million.
The Sacramento Kings, currently the center of multiple offers for about $520 million, are valued at $525 million, a head-turning 75% boost from the 2011-12 season. The Kings had revenue of $96 million last year with a paltry $2.6 million of operating income – or about the equivalent of eight games played by all-star Bryant.
The Kings could move to Seattle if businessmen Chris Hansen and Steve Ballmer, president of Microsoft Corp., are the successful bidders, which should be known in the next several weeks. Or a competing group could purchase the Kings from the Maloofs and build a new arena in downtown Sacramento, the latest plan for the troubled team.
The Los Angeles Clippers – headed by Chris Paul and Blake Griffin – finished at No. 18 with a value of $430 million. The Clippers, longtime on-court disappointments, had revenue of $108 million last season, with operating income of $9.1 million.
Only the Clippers were the only California team valued at less than the league average of $509 million, a 30% increase over last year.
A new collective-bargaining agreement, which cut the cost for players from 57% to 50%, an increase in revenue from cable television deals, and new and renovated arenas are the primary reasons for the impressive one-year gain. The labor agreement also boosted the dollars that high-revenue teams must provide to low-revenue teams, such as the Los Angeles Lakers sending money to teams like the Sacramento Kings.