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Detroit Tigers franchise valued at $1.12 billion

Forbes has released their annual Major League Baseball team valuation report, and the Detroit Tigers come in worth $1.12 billion.

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The values of Major League Baseball franchises continue to soar, and the Detroit Tigers are no exception. One year ago, the Tigers franchise was valued at $680 million. Now, Forbes estimates the franchise value at $1.12 billion, an increase of $440 million, or 65 percent in just one year. Baseball has never been more profitable.

The New York Yankees are the most valuable franchise, estimated at $3.2 billion, tied with the Dallas Cowboys for tops among U.S. sports franchises. The Los Angeles Dodgers, Boston Red Sox, and San Francisco Giants follow, each worth over $2 billion. Not coincidentally, those four clubs also have the highest payrolls in the major leagues, along with the Tigers, who are ranked 13th in terms of franchise value.

According to Forbes, franchise values increased by 48 percent over the past year, with half of all MLB franchises now worth over $1 billion. That is the largest increase since Forbes started keeping track in 1985. Television revenues are the driving force behind the increase in values, with $2.88 billion in revenues accounting for 37 percent of MLB's $7.86 billion annual business.That is up from 29 percent five years ago. As more local television deals expire and come up for renewal, networks and local outlets are paying out large sums for broadcasting rights.

Major League Baseball began an eight year, $12.4 billion national television deal with ESPN, FOX, and TBS in 2014. The Dodgers took in $120 million in local TV revenue, and also led the major leagues in ticket sales, drawing 3.78 million fans. The franchise was sold for $2 billion in 2012.

The Tigers ranked second behind only the St. Louis Cardinals in local television ratings, with a 7.62 rating watching on Fox Sports Detroit. St. Louis ranked sixth in franchise value, at $1.4 billion despite being in one of the game's smallest markets by population. They led the major leagues with $73.6 million in operating income in 2014.

Detroit Tigers team revenues totaled $254 million in 2014, with one-third of that amount coming from ticket sales. The average fan spent $44 on tickets and concessions per ballgame. Player costs are also up, from $163 million in 2013 to $184 million last season, the fifth highest payroll among major league teams. The club showed a net operating loss of $20.4 million.

Owner Mike Ilitch purchased the Tigers in 1992 for $82 million. The club's value has increased by over $1 billion during his ownership. He and his wife, Marian, are worth $4.9 billion, according to Forbes. Ilitch Holdings, Inc. also owns the Detroit Red Wings and Little Caesars Pizza enterprises.