Total Value: The sum of the fair-market value of an NFL franchise combined with the value of team-related businesses and real estate holdings.

Team Value: NFL franchise valuation, derived from metrics by which football-team transactions occur, including aggregating local and national revenues and factoring in a team-specific multiplier. This represents the fair market value of the team itself, excluding related businesses held by its owners.

Team-Related Businesses and Real Estate Holdings: The value of a franchise owner's equity in team-related businesses that are distinct corporate entities, as well as government-assessed real estate related to venue, practice facilities and adjacent developments. Examples include: Dallas Cowboys' owner Jerral (Jerry) Jones's interest in Legends Hospitality, a stadium operations corporation; and the Washington Football Team's two subsidiaries which own 13 parcels of land encompassing the team's stadium and surrounding tracts.

This category excludes value derived from enterprises determined as too attenuated from the football team's operations, which fall into three categories: (1) rent from non-football, outside-of-stadium retail operations; (2) licensing fees paid by non-football third parties to a team's sister company for the use of intellectual property; (3) team owner's investment in start-ups unrelated to franchise operations. Examples include: the Green Bay Packers collection of an estimated $7 million in rent from tenants related to its Titletown venture in 2019; branding of the Dallas Cowboys' sister company Blue Star Land's joint ventures with real estate partners; and the Cowboys' ownership's equity in Slack Sports, a digital start-up.

For franchises that do not own their venues, the value of a team's lease–often with advantageous terms negotiated with municipal or state authorities–is captured in the Team Value category.

Total Team Revenue: Cumulative amount of National Revenue and Local Revenue.

National Revenue: Each franchise's equal proportion of league-shared revenue, derived predominantly from NFL contracts with media and advertising partners, comprising in aggregate 60% of total team revenue for the 2019 season. This consists of:

(i.) National media rights (broadcast deals with Walt Disney Company, 21st Century Fox, Comcast, ViacomCBS, Amazon, SiriusXM and Cumulus Media).

(ii.) League sponsorship revenues (e.g., Verizon, AB InBev, Nike and many others).

(iii.) Net revenues and royalties from NFL Ventures, which includes the leagues various affiliates and subsidiaries, such as NFL Properties LLC, NFL International LLC, and NFL Enterprises LLC. These distributions covers licensing, film, international properties and media rights, as well as domestic TV deals with AT&T (NFL Sunday Ticket) and NFL Network.

Excluded from this calculation is income derived by and distributed from 32 Equity, the private equity investment vehicle established by the NFL in 2013.

Local Revenue: Revenue generated by each franchise independent of league distributions, comprising in aggregate 40% of total team revenue for the 2019 season. This is comprised of:

(i.) Stadium, which includes: ticket sales; premium seating (luxury suite leases and club seating); deferred and supplemental revenue from personal seat licenses, if applicable; parking; team's share of concessions; and non-football (third-party) events.

(ii.) Sponsorship, which includes: naming rights, advertising, corporate partnerships, local merchandising (distinct from league licensing royalties in National Revenue), as well as local TV and radio, for which teams often control advertising inventory.

(iii.) Road Game Revenue, which includes the net share of each team's proportion of revenue generated from games played outside of its venue.

2019 Season: Valuations are based on the last fiscal year for each team, as represented by the NFL's most recently completed, 2019 season (up to and including the Super Bowl played on February 2, 2020).

Full Transparency

Sportico is committed to transparency, including provision of detailed methodology and sourcing information below. For any additional questions, please contact senior sports valuations and legal reporter Peter J. Schwartz at pschwartz@sportico.com. Junior sports business reporter Randall Williams assisted in the compilation of this report.


Fair Market Franchise Valuations

To derive the fair market value of the 32 NFL franchises, Sportico calculated each team's revenue relying on publicly available information and financial records–and interviews with those knowledgeable of team finances, including five sports bankers who actively work on NFL transactions. We traded candor for anonymity. This information was vetted with multiple team owners, team financial and operating officers, media relations personnel and former team executives, as well as industry experts and sports-focused economists.

Revenue totals were then subject to a team-specific multiplier, which, based on interviews with multiple sports bankers, remains the only reliable manner by which transactions occur, due to dramatic fluctuations of earnings before interest, taxes, depreciation and amortization (EBITDA), year-over-year, based on salary cap spending and special expenses. One team owner told Sportico: "EBITDA at the end of the day is less a driver of football value than people think." A member of another team's ownership group said EBITDA can be important in informing a prospective owner's calculus of how to maximize cash flow if successful in bidding, consistent with other sports leagues, it is seldom the arithmetic basis for how a football team itself is valued.

The team-specific multipliers were based on multiple factors, including: historical sales, market (size, saturation and interest by prospective owners), strength of brand, on-field performance (historical and recent), terms of facility lease, debt burden, and expected future team and league economics. These ranges varied from 5.25 times revenue (i.e., Detroit Lions) to 7 times revenue (i.e., New England Patriots). In 2018, the Carolina Panthers sold for nearly 6 times revenue.

National Revenue was determined based on the annual financial report of the lone publically owned NFL franchise, the Green Bay Packers, released on July 21, 2020.

Local Revenue was calculated based on analyses of data from industry sources and reports, and interviews with experts and those with knowledge of team and league finances (detailed below); together, this comprised hundreds of inputs of confirmed and estimated information from dozens of sources, which were amalgamated and presented to each team for review and comment.


NFL Franchise Review and Comments

Among the 32 NFL franchises, multiple teams participated with Sportico by validating information, while others did not respond. A senior executive at the Miami Dolphins stated, on behalf of the team, that he is "comfortable with the information presented." Of the teams that did not respond, a former team president, vice president and officer with knowledge of operations validated information. Eight additional franchises declined comment: the Denver Broncos, Indianapolis Colts, Jacksonville Jaguars, Los Angeles Chargers, Los Angeles Rams, Pittsburgh Steelers, Tampa Bay Buccaneers and Tennessee Titans.

The Green Bay Packers provided information and answered questions as part of their annual release of financial information. However, the team declined to comment on its Total Value or a specific adjustment made by Sportico to account for Titletown as a related business and not within team revenues and expenses, which was done in order to bring them in line with all other teams. The National Football League also declined to comment on valuation totals.


Financial and Industry Sources

Team and league financial information was derived from the following sources: NFL and NFL Ventures bond ratings by Fitch Ratings; NFL Form 990s filed with the Internal Revenue Service from 2012 to 2015; historical NFL League Office Financial Reports over multiple years; historical financial reports of NFL Ventures, L.P. and subsidiaries; historical annual reports for the Green Bay Packers Football Club, Inc. since 2007; historical financial reports of the Kansas City Chiefs and Carolina Panthers, respectively, over multiple years; and analyses of historical team sales from 1999 to 2018, based on Sportico research.

Industry data sources include: the Association of Luxury Suite Directors (for club and luxury suite capacity and pricing); Team Marketing Report (fan spending and sponsorship information); individual team and sponsor websites; Chris Bigelow of the Bigelow Companies (per capita spending on stadium concessions); and the Marquette University Law School (historical sports facility lease information).

Economists and professors who participated in Sportico's valuation reporting include: Dr. John Vrooman, professor emeritus at Vanderbilt University (league revenue sharing dymanics); Dr. Dennis Howard, dean emeritus of Lundquist College of Business and Warsaw Sports Marketing Center, University of Oregon (valuation review); Dr. Daniel A. Rascher, professor at University of San Francisco and Stanford University (valuation methodology and Bay Area market); David Abrams, professor at the Preston Robert Tisch Institute for Global Sport at New York University (valuations of sports facilities and tax depreciations thereof); Ilhan Geckil, managing director of the consulting firm EconOne (methodology, valuation and revenue-multiple review); and Judith Grant Long of the University of Michigan (through her book, Public/Private Partnerships for Major League Sports Facilities).

In addition to the sports bankers, team owners and team executives discussed above, Sportico interviewed hedge fund investors regarding methodology and results, including Max Chen, managing member of Crescent Capital Ventures, and Max Raskin of QVIDTVM, who have specialized knowledge of valuations. Additional interviews related to specific valuations components included Ed Desser of Desser Media, Inc. (to assess local broadcast revenue); Marc Ganis of Sports Corp. (distribution of league-related revenue); and Kim Mandara of Legends Hospitality (to inform Sportico's assessment of the growth of the Dallas Cowboys' part-owned stadium operations company since the 2017 sale of a minority interest).


Government Sources

To assess team-owned real estate with consistency, Sportico included government property appraisals. Sources included: Brown County Land Records (Wisconsin); Collin County Appraisal District (Texas); Denton County Central Appraisal District (Texas); Los Angeles County Assessor (California); Maryland Department of Assessments and Taxation; Prince George's County (Maryland); Miami-Dade County Property Appraiser (Florida); and the Town of Foxborough Assessor's Office (Massachusetts).

To review the terms of teams' facility leases with municipal and state authorities, Sportico examined public documents from–or reporting pertaining to–the following entities: the Arizona Sports and Tourism Authority; Chicago Park District; City of Arlington, Texas; City of Charlotte, North Carolina; City of Cleveland, Ohio; City of Detroit, Michigan and Wayne County Stadium Authority; City of Green Bay, Wisconsin and Brown County Pro Football Stadium District; City of Jacksonville, Florida; City of Nashville, Tennessee and Davidson County; City of Oakland, California and Alameda County; City of Philadelphia, Pennsylvania; Erie County Stadium Corp (Buffalo); Georgia World Congress Authority; Hamilton County, Ohio; Harris County Sports & Convention Corp. (Houston); Indiana Stadium and Convention Building Authority; Jackson County Sports Complex Authority (Kansas City); Louisiana Stadium and Exposition District; Maryland Stadium Authority; Metropolitan Football Stadium District (Denver); Minnesota Sports Facilities Authority; New Jersey Sports and Exposition Authority; Santa Clara Stadium Authority; Sports & Exhibition Authority (Pittsburgh); Tampa Sports Authority; and Washington State Public Stadium Authority.

In addition, the State of New York's Senate Assembly record of its 2019 budget was reviewed for information related to the apportionment of $2,331,000 to "services and expenses related to the retention of professional football in Western New York" (Buffalo Bills); and Missouri Department of Revenue documents were reviewed related to the Kansas City Chiefs' historical financial performance.


Team-Specific Notes

• The Las Vegas Raiders, Los Angeles Chargers and Los Angeles Rams' valuations are based on multiples of projected revenues from their new venues–not revenue from the 2019 season–in order to provide a more accurate assessment of each team's earning potential. The revenue totals listed for each of these teams is as calculated for the 2019 season with the Raiders playing at the RingCentral Coliseum in Oakland, Calif.; the Chargers playing the Dignity Health Sports Park in Carson, Calif.; and the Rams playing at the Los Angeles Coliseum.

• The Dallas Cowboys opted-out of the NFL's licensing program in order to market and distribute their own merchandise. Accordingly, the team's merchandise revenue, accounted for in Local Revenues, is net of payments made to the league to exercise this right.

In addition, since Sportico calculates fair market franchise valuations, neither the Cowboys as the league's most valuable team nor any other franchise were subject to a discount even though NFL ownership requirements related to equity and debt limits the number of potential buyers.

• The Buffalo Bills' Local Revenue includes an annually budgeted subsidy from the State of New York (discussed above); however, this distribution and another benefit related to stadium bonds do not factor into the team's Total Value due to their non-permanent nature.

• The Jacksonville Jaguars' Team-Related Business and Real Estate Holdings do not include the current real estate joint venture involving the team's subsidiary, Gecko Investments LLC, since it is awaiting regulatory approval. Note that if this entity's planned projects begin in earnest, then Gecko Investment's operations will positively affect future valuations of the Jaguars.


COVID-19

Since our valuations are as of the last completed season, all data reflects the period ending in February 2020, prior to the substantive spread of the novel Coronavirus.

It is worth noting that as of August 24, 2020, NFL owners are treating the effects of the virus as ephemeral to the market for potential sales. As one NFL owner told Sportico, citing the bidding process of baseball's New York Mets, "No one is thinking of Coronavirus during this process. It is an aberration."

However, based on this timeline, an assessment of the economic effects of the virus will factor directly into Sportico's future franchise valuations.