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The NBA Owners' Hidden Pot of Gold

By July 11, 2011

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Much of the NBA Lockout discussion to date has been stuck on the question of yearly profits and losses. But as SBNation's Tom Ziller points out, even a modest yearly operating loss doesn't make owning an NBA team a bad investment... not when NBA franchises are selling for record numbers.

Jerry Buss has seen the Lakers' value grow $587 million in 21 years. Michael Heisley has seen the Grizzlies' value grow $97 million in 10 years. Dan Gilbert has seen the Cavaliers' value grow $101 million in five years. Mark Cuban of the Mavericks: $166 million in 10 years. Cablevision with the Knicks: $286 million in 13 years. And on and on and on ...

Ziller also points out that the Golden State Warriors just sold for $450 million, the for the same number, and the Sixers are expected to fetch $350 million some time soon, and the NBA paid $300 million to George Shinn to take control of the New Orleans Hornets. Shinn paid $32 million to launch the team in 1987. I'm guessing that's a better return on investment than he would have gotten in the stock market.

Also worth noting: when a team is sold, the seller gets a massive windfall, but the players get nothing. Which is one reason I'm inclined to take the NBPA's side in the "should a team's purchase price count against its yearly profit/loss" question.


Jerry Buss has seen the Lakers' value grow $587 million in 21 years. Michael Heisley has seen the Grizzlies' value grow $97 million in 10 years. Dan Gilbert has seen the Cavaliers' value grow $101 million in five years. Mark Cuban of the Mavericks: $166 million in 10 years. Cablevision with the Knicks: $286 million in 13 years. And on and on and on ...

Comments

July 11, 2011 at 4:31 pm
(1) Andrew Weaver says:

NBA fans agree that the league is headed in the wrong direction with a corrupt commissioner at the helm. A commissioner who gives full authority to corrupt referees who openly admit to betting on games, making wrong calls, and saying they donít care. Commissioner Sterns actions have violated the leagues rules and guidelines toward players and fans. So I ask NBA fans to stand behind in calling for Commissioner Sterns resignation on the grounds that his actions are disgraceful and unethical. Not to mention the fact that this lockout has little to do with the players and more to do with owners sentimental reactions to lost income. Thatís why owners expect nothing less than the inflated values from their assets due in part of the NBAís decision to mirror big businesses harmful profit schemes. Itís this type of mind mentality that destroys teams.

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