LAFC Value Hits $1 Billion, But Who’s Buying?
Los Angeles Football Club has become the first Major League Soccer team to reach a value of $1 billion. This is according to a report by Forbes. LAFC has only been in the US top flight for nine years. Principal owner Bennett Rosenthal and his partners initially paid an expansion fee of $110 million to join the league.
LAFC value more than doubled since 2019
The huge rise in valuation in such a short time is amplified by the fact that Forbes has doubled the value of LAFC in just four years. Forbes previously valued the club at approximately $475 million in 2019. This was the last time the company issued valuations for American football teams.
While it’s an incredible return on investment, Rosenthal previously claimed he didn’t start LAFC to make tons of money. “We didn’t do this because we thought it was the best place to put our capital,” Rosenthal said said about starting the franchise. “We thought it could be fun and we’re making a great macro bet on the sport’s growth.”
LAFC’s valuation is certainly a sign that MLS is growing in more ways than one. The league started in 1996 with only 10 teams. Now, heading into the 2023 season, a total of 29 clubs will be vying for the title. Along with the influx of teams, valuations are rising across the board.
MLS club valuations have risen by an average of 85% over the past four years
According to Forbes, the average team rating has increased by 85% since 2019. The outlet claims that the average MLS side is now worth about $579 million. Another report claimed that many American clubs are actually worth more than some Premier League teams. In fact, England’s seventh most valuable club, Everton, is worth about the same as New York Red Bulls. RBNY ranks 18th in MLS team ratings.
It will also cost a lot more to form an expansion team now as well. The next expansion club, possibly San Diego or Las Vegas, is expected to cost about $500 million. Charlotte FC previously set a record when they joined MLS for $325 million less than four years ago. Compare this with Toronto FC only coughing up $10 million to join the league in 2007 and New York City Football Club pay $100 million for a franchise in 2015.
Club sales have already increased significantly
As reported valuations rise, we can also expect a huge increase in potential sales. Columbus crew previously sold for just $150 million at the end of 2018. Orlando City, on the other hand, switched hands for between $400 million and $450 million in the summer of 2021.
A significant increase in valuations can be partly attributed to the recent Apple media rights deal. Under the agreement, MLS is essentially guaranteed for at least $2.5 billion over 10 years. This figure could even increase depending on the total number of subscriptions.
LA Galaxy ($925M), Atlanta United ($850M), NYFC ($800M) and DC United ($700M) complete with LAFC Forbestop five MLS clubs by value.
PHOTO: IMAGO / ZUMA Wire
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Don Garber,Forbes,LAFC,Los Angeles,Premier League football,MLS,World football news