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View Full Version : Report: Cincinnati Reds worth $424 million



savafan
03-28-2012, 05:02 PM
http://www.bizjournals.com/dayton/blog/morning_call/2012/03/report-cincinnati-reds-worth-424.html


The franchise value of the Cincinnati Reds Cincinnati Reds Latest from The Business Journals Cincinnati Reds franchise value up 13%, Forbes says2012 Green Business Awards Finalist: RumpkeCincinnati Reds pick Sheriff Simon Leis to throw out first pitch Follow this company rose 13 percent in the past year to $424 million, according to the Cincinnati Business Courier.



Still 24th out of 30 teams, but a 13% increase in value is nice to see.

Cedric
03-28-2012, 06:17 PM
I plan on owning them after I hit the mega millions.

_Sir_Charles_
03-28-2012, 07:12 PM
I plan on owning them after I hit the mega millions.

What position are you going to have yourself play? :thumbup:

VR
03-28-2012, 07:38 PM
Great....based on the Magic Johnson scale, they can be sold for around a cool Billion?

Mario-Rijo
03-29-2012, 11:00 AM
I plan on owning them after I hit the mega millions.

Beat me to it! :thumbup:

Johnny Footstool
03-29-2012, 12:04 PM
http://www.bizjournals.com/dayton/blog/morning_call/2012/03/report-cincinnati-reds-worth-424.html



Still 24th out of 30 teams, but a 13% increase in value is nice to see.

MLB teams are generally good investments, even if they cry about being in a "small market" and not having the budget to pay good players.

bucksfan2
03-29-2012, 01:26 PM
MLB teams are generally good investments, even if they cry about being in a "small market" and not having the budget to pay good players.

Owning MLB teams are a fantastic investment. The problem is you really only see the huge gains when you sell the team. The day to day operations is why it hurts to be a "small market" team. The revenue stream is quite a bit lower for the "small market" clubs as opposed to the "major market" teams.

AtomicDumpling
03-29-2012, 02:49 PM
Owning MLB teams are a fantastic investment. The problem is you really only see the huge gains when you sell the team. The day to day operations is why it hurts to be a "small market" team. The revenue stream is quite a bit lower for the "small market" clubs as opposed to the "major market" teams.

According to the numbers published annually by Forbes most of the small market teams are highly profitable most years. Mid-market teams like the Reds also make huge cash profits annually in addition to the large equity gains.

Also, you don't have to sell the team to make use of the huge gains in the value of the franchise. Every single owner in the league leverages that equity to finance their other business investments and it would be extremely short-sighted not to. That is the primary reason most owners buy the teams. Leverage is the most important benefit to owning commercial real estate and is the critical tool used by 90% of team owners to build their fortunes. No owner in his right mind would let all that equity sit there without making use of it. Leverage is the most basic and essential principle in the world of real estate investing and you can't be successful without taking advantage of the wonderful opportunities it provides. An income-producing property with huge equity gains like a major league franchise is the ideal investment property, which is why their values continue to skyrocket even in a deep recession.

Leaving all the equity to just sit there is akin to burying millions of dollars in your back yard where it cannot earn you any interest or income. It is foolish. Banks and investors will loan the franchise owner money at a very low interest rate against the extremely safe equity in the team. The owner can then re-invest that money in more properties that will yield him additional income streams as well as appreciate in value just like the baseball franchise does. There are also tax benefits for using leverage. Leverage is a way to magnify and multiply your income. Failure to take advantage of this opportunity would be a rookie mistake that a major league owner would never make.

bucksfan2
03-29-2012, 04:01 PM
According to the numbers published annually by Forbes most of the small market teams are highly profitable most years. Mid-market teams like the Reds also make huge cash profits annually in addition to the large equity gains.

Also, you don't have to sell the team to make use of the huge gains in the value of the franchise. Every single owner in the league leverages that equity to finance their other business investments and it would be extremely short-sighted not to. That is the primary reason most owners buy the teams. Leverage is the most important benefit to owning commercial real estate and is the critical tool used by 90% of team owners to build their fortunes. No owner in his right mind would let all that equity sit there without making use of it. Leverage is the most basic and essential principle in the world of real estate investing and you can't be successful without taking advantage of the wonderful opportunities it provides. An income-producing property with huge equity gains like a major league franchise is the ideal investment property, which is why their values continue to skyrocket even in a deep recession.

Leaving all the equity to just sit there is akin to burying millions of dollars in your back yard where it cannot earn you any interest or income. It is foolish. Banks and investors will loan the franchise owner money at a very low interest rate against the extremely safe equity in the team. The owner can then re-invest that money in more properties that will yield him additional income streams as well as appreciate in value just like the baseball franchise does. There are also tax benefits for using leverage. Leverage is a way to magnify and multiply your income. Failure to take advantage of this opportunity would be a rookie mistake that a major league owner would never make.

:thumbup: Never thought of it that way.

Frank McCourt says hi though. I see what you are saying about leverage but it also can be dangerous as the McCourts proved. Its almost if the MLB approves you to buy a team you just hit the jackpot. What I find somewhat ironic is gone are the days where owners were wealthy and paid for their club. Now it seems as if every owner or ownership group takes on a substantial amount of debt in order to finance their purchase of a MLB team. When all the details emerge I want to see how much financing the ownership group who just bought the Dodgers took on. Its funny to think that once the ink dries on the contract the Dodgers value of the Dodgers probably will have increased by a handful of million dollars.

AtomicDumpling
03-29-2012, 04:31 PM
:thumbup: Never thought of it that way.

Frank McCourt says hi though. I see what you are saying about leverage but it also can be dangerous as the McCourts proved. Its almost if the MLB approves you to buy a team you just hit the jackpot. What I find somewhat ironic is gone are the days where owners were wealthy and paid for their club. Now it seems as if every owner or ownership group takes on a substantial amount of debt in order to finance their purchase of a MLB team. When all the details emerge I want to see how much financing the ownership group who just bought the Dodgers took on. Its funny to think that once the ink dries on the contract the Dodgers value of the Dodgers probably will have increased by a handful of million dollars.

Yes you are absolutely correct. The McCourt's treated the value of the team as a piggybank to finance their lavish lifestyle instead of investing the money wisely. But even they came out with more than a billion dollars in profit. The owner of the Mets lost a ton of money in the Madoff Ponzi scheme, but likewise he has also made hundreds of millions on his investment in the Mets.

The values of these teams have skyrocketed to what seems like insane amounts of money. How could two billion dollars be a smart purchase price? I don't know but I don't think any owners have lost money on their investments in an MLB team in recent decades despite the exorbitant purchase prices they paid.

Blitz Dorsey
03-30-2012, 08:07 PM
How much did B-Cast purchase the team for? Story doesn't mention that.

RedsManRick
03-30-2012, 11:21 PM
Unfortunately I did not win the Mega Millions tonight and will not be able to buy the Reds. Just thought you should know.

Brutus
03-30-2012, 11:27 PM
Unfortunately I did not win the Mega Millions tonight and will not be able to buy the Reds. Just thought you should know.

I did and I will.

Monopoly money counts, right?