Lakers ace Dodgers as Southland's most valuable franchise.

The Los Angeles Lakers basketball team has replaced the Dodgers as the most valuable professional sports franchise in Los Angeles County, according to a just released study by Financial World magazine.

According to the New York-based national publication, the value of the baseball Dodgers has fallen 25 percent in the last two years to $135 million while the value of the Lakers increased slightly to $155 million (see accompanying chart on page 56).

Of the 103 professional sports franchises in the four major sports, only the St. Louis Cardinals baseball team declined more in value than the Dodgers, the magazine said. According to the publication, the Cardinals depreciated in value by 25.5 percent to $98 million in the past two years.

Among the other franchises in the county, the hockey Kings showed the biggest change, going up in value from $60 million to $71 million. The other teams, which include the football Rams and Raiders, and the basketball Clippers, remained fairly stable in terms of their financial worth.

An assessor of professional sports teams for American Appraisal Associates Inc. in Milwaukee said the Dodgers' value may not have declined so much.

"That may be a little low (the $135 million)," said Michael Megna, senior vice president of AAAI. "I think what's happening is that people are starting to factor in the expected decline in television revenue. The Dodgers will lose some value because of the television contract but I don't think it's going to be that much."

This is the last baseball season of a television contract with the CBS network in which each of the 28 teams in Major League Baseball gets about $15 million in revenue every year. The next national television contract is expected to tally considerably less than the current agreement, which is worth a total of more than $1 billion.

The annual study by Financial World is considered a fairly accurate picture of the financial health of each team in the four professional sports of baseball, basketball, football and hockey. Generally, financial information about individual teams is difficult to obtain because most teams are privately held. All of Los Angeles County's professional teams are private and therefore are not required to reveal any financial data.

Most experts who follow professional sports teams say the Dodgers franchise probably has lost a bit of its financial luster because of last season's 23 percent drop in attendance to 2.5 million from 3.3 million in the 1991 season. A Dodger executive said following the 1992 season that the team could lose more money than at any time in the 103-year history of the franchise.

Dodger Vice President of Finance Bob Graziano said the team doesn't place much value on the study because the team itself doesn't know what it's worth.

"I don't place much credence in the methodology," said Graziano. "All the numbers are based on estimates that the magazine got from other estimates. It is probably based on one year's performance and I don't think you can value a team like the Dodgers, with its history, on one year's performance."

Even though the Dodgers lost value, according to the magazine, the team is still one of the most valuable professional franchises. Of the 103 professional teams, the Dodgers are the 14th most valuable franchise, with the football Dallas Cowboys on the top of the list with an estimated worth of $165 million.

The Lakers are the fourth most valuable franchise, according to the magazine.

Bob Steiner, a spokesman for Jerry Buss, owner of the team, said he thought the Lakers could be even more valuable.

"There is talk that a new NBA (National Basketball Association) expansion franchise could be worth $130 million," Steiner said. "So what would I think a team like the Lakers would be worth?"

Generally, a professional sports team is valued by its location (teams in major markets are more valuable than ones in smaller areas); the cost of its player contracts; whether it owns or leases its stadium, and the value of its local television and radio broadcasting contracts. Overall average attendance is an important factor in setting value and is usually included among the variables considered in assessing the value of a location.

Value of Los Angeles County professional sports teams
(in millions)
Team                 1993           1991
Clippers              $54            $54
Dodgers              $135           $180
Kings                 $71            $60
Lakers               $155           $150
Raiders              $124           $128
Rams                 $128           $126
Source: Financial World

Megna of AAAI said the Lakers are a valuable franchise because of the NBA's ceiling on player salaries, and because of the Los Angeles market. He said, however, that the Clippers will gain value over the next few years and the Lakers will probably lose value. He said he expects the Lakers to lose value because the team is on the decline following nearly a decade of winning teams.

According to Financial World, the Lakers by far are the most valuable NBA franchise. The next most valuable basketball team is the Detroit Pistons, which is in 17th place.

The Clippers are the 86th most valuable sports franchise, said Financial World.

Regarding the Kings, most sports-industry experts say hockey teams are generally gaining value because of lower player salaries and high game attendance. The Kings, for instance, sell out most of its home games.

During the recently concluded regular season, the Kings sold out 34 of 41 home games at the Great Western Forum in Inglewood.

Of the county's two professional football teams, the Rams have a slightly higher value. According to the magazine, the Rams are worth $128 million and the Raiders have a value of $124 million.