The likely sale of the Toronto Blue Jays, announced yesterday, may answer one of the more compelling questions in sports: Will the Orioles go down in history as the most expensive baseball team?
The $173 million price paid for the Orioles in 1993 was a record for a sports franchise. The NFL Eagles and Buccaneers have since been sold for more, but no baseball team with a comparable revenue potential has been put on the block until now.
Belgian brewer Interbrew announced yesterday a $2.9 billion, friendly takeover of beer and entertainment giant John Labatt Ltd. and said it plans to sell Labatt's non-beer operations, including: the Blue Jays, the Canadian Football League Argonauts, sports television network TSN and a stake in Toronto's SkyDome.
Like the Orioles, the Blue Jays play in a state-of-the-art stadium loaded with revenue-producing luxury seats. In 1994, the Orioles finished a close second in American League attendance to the Blue Jays.
But analysts have wondered since the Orioles sale whether the ensuing labor troubles and loss of popularity of baseball would hurt the Orioles' value. In modern baseball history, only CBS' 1973 sale of the New York Yankees has seen a team sold for less than its owners paid.
The Blue Jays may offer some guidance, and a test case for baseball values in general, said Richard Siladi, vice president of American Appraisal Associates of Milwaukee, which helps value franchises.
Siladi predicted the team, which, along with the Orioles, is among the five most valuable in baseball, would sell for $150 million to $200 million.
"A lot of it has to do with the nuts and bolts of the lease there," he said. "It's really crystal ball time."
Camden Yards, for example, has 72 sky boxes renting for $55,000 to $95,000 a year with 90 percent of the revenue going to the Orioles. The SkyDome has 161 sky boxes, renting for $100,000 to $225,000 with the ticket money going to the team and the annual rental going to the SkyDome, 40 percent of which is owned by the team, according to "Inside the Ownership of Professional Sports."
"I don't see it going for what the Orioles did. They don't have Camden Yards," said Paul Much, a valuations expert with Houlihan Lokey Howard & Zukin in Chicago and co-author of "Inside the Ownership of Professional Sports." He thinks $150 million sounds right.