Investing in multiple teams rather than one is a smart strategy for bundling assets that have historically appreciated in value but are not tied to the economy or the stock market.
T.His aspirations for a sports empire go from strength to strength. A group led by Josh Harris is looking to buy the NFL’s Washington Commanders for $6 billion. Via Harris Blitzer Sports & Entertainment, Harris is already managing partner of the NBA’s Philadelphia 76ers and NHL’s New Jersey Devils. Outside of HBSE, Harris is the general partner of English football team Crystal Palace. In January, Forbes magazine named HBSE the world’s 18th most valuable sports empire, worth $4.65 billion. All told, if the Commanders deal goes through, Harris would effectively run a sports empire worth about $10 billion.
The beauty of Empire is that the whole is far more valuable than the sum of its parts. In the video below, Ted Leonis, who runs Monumental Sports & Entertainment, which owns the Wizards (NBA) and Capitals (NHL) of Washington, shows how empires derive scale from their sports assets and invest in valuable intellectual property. I explained how I could get the same valuation as a tech company with a fortune.
No wonder investors want to join the movement. Sportico reported last week that Maple Leaf Sports & Entertainment chairman Larry Tanenbaum was about to sell his stake in MLSE, which owns the Toronto Raptors (NBA) and Maple Leafs NHL, to Ontario’s corporate pension plan for civil servants. rice field. It is valued at more than $8 billion, and the Qatar Investment Authority has purchased a portion of Leonsys’ MSE at a valuation of $4.05 billion.
And just yesterday, Bloomberg reported on Redbird Capital, which owns Italian soccer team AC Milan and part of the English Premier League.
The lesson is very clear. If you have the money, investing in a sports empire rather than a single team is a smart way to put together assets that have historically risen in value but aren’t tied to the fortunes of an economy or stock. A market similar to a typical business. In 2009, as the Great Recession was nearing its end, the Ricketts paid a record $700 million to the Cubs and Wrigley Field, plus a 25% stake in Comcast SportsNet Chicago owned by Tribune. Remember we paid another $145 million. Those moves gave Chicago’s media giant 13 times more in real terms than it did 20 years ago, a year ago when the S&P 500 fell 37%.
The rise of sports empires will only escalate as sports leagues continue to loosen rules on organizational and sovereign ownership.