Minor League Baseball's Most Valuable Teams
On July 9, 2011, the Dayton Dragons drubbed the South Bend Silver Hawks, their Class A Midwest League rivals, by a score of 9 1. Though the game's attendance number might not seem remarkable at fewer than 9,000 fans it was a fraction of what even the MLB's worst teams draw nightly it marked the Dragons' 815th consecutive sellout, a streak that stretched back to the team's inaugural season in 2000 and, as of that July day, one that set a pro sports record. It's a streak still going strong in 2013 at well over 900 games.
That remarkable drawing power is just one example of the potential financial success that minor league baseball teams can generate even in smaller markets like Dayton. And it's a big reason why we estimate that the Dragons are minor league baseball's sixth most valuable team at $31 million, a truly impressive feat for a Single A team.
In fact, the Dragons are one of only two teams on our list that aren't Class AAA, the highest level in Minor League Baseball's (MiLB) hierarchy. The other team is the Frisco RoughRiders (Texas League/AA), which rank No. 11 with a value of $28 million. It's likely no coincidence that both teams are owned by Mandalay Baseball Properties, a partnership between Mandalay Entertainment founder and chairman Peter Guber also has ownership stakes in the Los Angeles Dodgers and Golden State Warriors and private equity fund Seaport Capital that has become one of minor league baseball's best ownership success stories.
Mandalay Baseball owns five minor league teams, with three ranking among MiLB's 20 most valuable (the Class AAA Pacific League's Oklahoma City RedHawks, worth $21 million, join the Dragons and RoughRiders). Mandalay's other two teams are the Erie SeaWolves (Eastern League/AA) and Scranton/Wilkes Barre RailRiders (International League/AAA), the latter of which is half owned by the affiliate New York Yankees. The five teams have been for sale since April, and they will reportedly generate some $40 million in revenue this season.
Multiple team ownership like Mandalay's is not unheard of in minor league baseball; in fact, it's surprisingly common. Though individual leagues have rules against multiple team ownership, that doesn't stop prospective owners from taking stakes in teams from different leagues across MiLB's ranks. Billionaire Robert Rich, for instance, owns three teams, including the Buffalo Bisons (International League/AAA), which rank No. 13 on our list with an estimated value of $26 million. Hall of Famer Nolan Ryan also owned stakes in multiple teams until recently agreeing to sell the Corpus Christi Hooks (Texas League/AA) to Houston Astros owner Jim Crane; Ryan's other team, the Round Rock Express Express, is MiLB's second most valuable franchise at $35 million.
Fellow first ballot Hall of Famer Cal Ripken, Jr. has two teams of his own, the Aberdeen IronBirds (New York Penn League/Short Season A) and Charlotte Stone Crabs (Florida State League/A), and in May he sold the Augusta GreenJackets (Sally League/Low A) for a reported $7.5 million. Neither of Ripken's two teams appear on our list, but they are part of what's become the Iron Man's $30 million post retirement baseball brand.
FORBES Executive Editor Mike Ozanian discusses our minor league baseball valuations on the YESYES wholesale cheap Colts jerseys china
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Though wealthy individuals comprise the majority of team owners, an interesting twist on minor league ownership is the few MLB teams that have bought their own minor league affiliates. The MLB clubs are already paying most of the costs all minor league player and coaching costs are picked up by the affiliated MLB team, along with half the cost of bats and balls so why not alsoalso wholesale Colts cheap jerseys
reap the profits? Plus, minor league ownership by MLB teams creates a better bond for fans (many such minor league teams adopt their MLB affiliate's team name), provides stability for player development contracts and ensures greater control over their farm system's operations.
As mentioned above, Houston Astros owner Jim Crane has purchased the Corpus Christi Hooks, his team's AA affiliate. Crane is also rumored to be interested in the Astros' AAA partner, the RedHawks, though Mandalay's plan to sell its five teams as a package deal may stand in his way. The Yankees not only own half of their AAA team, but they also have stakes in Single A teams in Tampa, Florida and Staten Island, NY. The Atlanta Braves own all but one ofof wholesale cheap Colts jerseys
their farm teams, the Lynchburg Hillcats (Carolina League/High A), while the St. Louis Cardinals own two teams and have been in talks to buy a third, the Memphis Redbirds (Pacific Coast League/AAA), which tie for eighth on our list with an estimated value of $29 million.
To find the most valuable teams we first limited our scope to franchises with MLB affiliations, so the MiLB sanctioned Mexican League was omitted, as were independent and foreign leagues. That left a pool of 160 teams which was cut down to the top 35 teams in attendance last season; this makes sense because in stadium revenue streams (ticket sales, luxury suites, parking, concessions, stadium naming rights and sponsorships) constitute almost the entirety of a team's income, making home game attendance central to team value.
We then used available audits, reports and stadium leases to build our estimates of team revenues and expenses in 2012, the most recently completed season. In cases where financial details were unavailable, wewe wholesale cheap Colts jerseys china
made comparisons to teams in similar markets for which we had definitive data. Our final values are derived from multiples of revenue and attendance, using recent transactions as a guide.
The most instructive transaction was the recent sale of the Las Vegas 51s (Pacific Coast League/AAA), the New York Mets' farm team that recently set a new baseline for Class AAA teams. The 51s ranked No. 48 in attendance last year, and only three AAA teams drew fewer fans. The Wall Street Journal profiled the team's many troubles in June, noting thatthat cheap Colts jerseys free shipping
no MLB franchise wants to be affiliated with the team. And yet in May the Vegas team sold for $20 million, which has become the generally accepted minimum price for a AAA team.
While the sale of the 51s may spell trouble for Las Vegas the new owners, a joint venture between the Howard Hughes Corporation and other investors, appear intent on moving the team outside of the city it's great news for other minor league franchises that have enjoyed the surge in value. The 20 most valuable teams are worth an average $28 million, up from $22 million last year.