The Value of Sports

If you’re a Yankees fan, the high cost of tickets in the Bronx Bombers’ new stadium may have you scratching your head and missing more than a few home games... even though the owners decided to slash some of the highest prices.

But there’s some rhyme and reason behind the team’s $90 nosebleed-section seats -- the cheapest available -- said valuation expert Dr. Peter L. Lohrey, and at a meeting of the Entertainment and Sports Committee this morning, he explained the factors considered in the valuation of a sports franchise.

“It’s important to note that the driver for one franchise isn’t the same as another,” he said. For example, ticket revenue in Minnesota is going to be a very different number than in Miami or New York City.

In addition to ticket sales, there are other types of revenue that add to a franchise’s value, among them concession stand sales, broadcasting revenue and pubic versus private stadium ownership. To learn more about how one figures the value of institutional sports teams like the Yankees or the Dallas Cowboys -- which, in turn, sets ticket prices -- or have wondered why the New York Giants built their stadium in New Jersey, check out an upcoming story in the CPAs in industry section of the July 15 Trusted Professional.