CHICAGO (Reuters) - The average team in the National Football League is now worth more than $1 billion, marking the first time any sports league has surpassed that level, according to a report released on Wednesday.
The 2008 average valuation for the 32 NFL teams was $1.04 billion, up 8.7 percent from last year’s $957 million due to the sport’s popularity and cash-generating new stadiums, said Forbes magazine, which releases its rankings annually. Ten years ago when Forbes first valued NFL teams, the average franchise was worth $288 million.
The NFL is the most popular U.S. sports league with strong television ratings and annual league revenue topping $7 billion. While TV ratings have slipped over the last decade, NFL games still boast the strongest ratings among sports leagues.
Several teams benefited from new stadiums — either completed or under construction — that include more cash- generating luxury boxes. Those included the Indianapolis Colts, which jumped 13 spots to No. 8, with a value of $1.076 billion, Forbes said. The Colts are playing this season in a new stadium.
Both New York teams, the Giants and Jets, showed the biggest percentage gains at 21 percent, thanks to the new jointly owned stadium they will move into in 2010. The Giants moved to No. 4 at $1.178 billion, while the Jets were at No. 5 at $1.17 billion, Forbes said.
While the average team is now worth more than $1 billion, the owners cited the heavy costs associated with stadium construction, as well as high player salaries when they opted in May to terminate their labor contract early with the players union in a move to cut costs.
Also, those new stadiums bring with them higher costs for fans, as ticket prices continue to rise despite the weak U.S. economy. Last week, sports marketing firm Team Marketing Report said the average price of an NFL ticket rose 7.9 percent to $72.20, while the cost of an outing for a family of four has increased almost as much.
The top three teams in the Forbes list were the same as last year: the Dallas Cowboys ($1.612 billion), the Washington Redskins ($1.538 billion) and the New England Patriots ($1.324 billion). The Redskins have the highest estimated revenue and operating income at $327 million and $58.1 million, respectively.
Forbes said its team valuations are enterprise values, calculated using multiples of revenues based on historical transactions.
Reporting by Ben Klayman; Editing by Andre Grenon