Record-Breaking Sale
The Los Angeles Lakers are changing ownership at an unprecedented valuation of $10 billion, marking the highest ever for a sports franchise. This sale not only benefits the buyer significantly but also symbolizes an inevitable transition in ownership from the Buss family to an investment group led by Mark Walter, owner of the Los Angeles Dodgers.
The Value of Sports Teams
Owning a sports team is a highly lucrative asset, providing owners with substantial benefits and social status. Team valuations in major North American sports have consistently risen over the years. The Lakers’ sale highlights a growing trend where high-value teams are becoming too valuable for individual control, suggesting that ownership structures are evolving.
The Buss Family Legacy
Since Jerry Buss purchased the Lakers in 1979, the team has functioned like a massive family business and has been the primary source of the Buss family’s wealth. Historically, the Lakers have managed their finances through revenues from a substantial local television deal with Spectrum.
Shift Towards Consortium Ownership
As the cable industry declines, professional sports teams are increasingly owned by investment consortiums rather than wealthy individuals. The Buss family had already begun this shift when they sold a quarter stake to Walter’s group in 2021, which has successfully owned the Dodgers since 2012 and also controls the WNBA’s Los Angeles Sparks.
Future Growth and Stability
The new owners of the Lakers are expected to see a favorable return on their investment. While cable declines pose a risk to some sports franchises, the Lakers’ strong ties to Los Angeles ensure their popularity will continue to thrive. Betting on their future growth is likely a safe bet, potentially leading to even higher valuations down the line.
Impact on Fans
This sale is likely to be beneficial for Lakers fans, although their interests are typically not the primary focus in these transactions. Walter’s success with the Dodgers could lead to an even more attractive team for star players, further enhancing the fan experience—something fans inherently desire.
Challenges in Ownership Models
While the Lakers’ future appears bright, the trend towards institutional ownership raises concerns for clubs that do not have the same level of success. Individual owners can be held accountable, but the anonymity of a consortium may lead to a lack of transparency and responsibility, making it easier for investors to exploit the teams for profit without the public accountability that comes from a visible owner.
