The Factors Driving Rising Sports Team Valuations

Sports teams are an increasingly attractive asset class for investors. Historic sales, like Mark Walter’s $10 billion purchase of the Los Angeles Lakers, Chelsea F.C.’s $5.3 billion sale, and Angel City F.C.’s $250 million transaction have emphasized the factors driving rising sports team valuations. At the 2026 Milken Institute Global Conference, leading sports investors and executives unpacked the factors driving rising sports team valuations: scarcity, media opportunities and commercialization prospects.

Scarcity

Most basically, a low supply of teams with high potential to drive profit motivates investors like Walter or new Angel City F.C. owners, Willow Bay and Bob Iger, to pay heavily for sports teams. The number of teams in any sports league is governed by the league’s bylaws or constitution. To add a new team, existing owners must engage in a lengthy expansion approval process following rules and procedures outlined in the league’s governing documents. American professional leagues are currently experiencing an expansion wave, but in all, the number of teams in a respective league remains relatively static.

Thus, investors with the means who desire sports team ownership must seriously evaluate purchasing any team or club put up for sale. Scarcity has played an important factor in driving high valuations for NWSL clubs. In recent years, the women’s soccer league has made headlines with blockbuster team ownership transactions. Upon its sale for $250 million, Angel City F.C. became the then most valuable women’s sports franchise globally (the record was later beat by the WNBA’s Golden State Valkyries). The Angel City F.C. sale charged forward after the historic 2024 sale of NWSL counterpart, San Diego Wave FC. In 2022, Ron Burkle paid a $2 million expansion fee to secure ownership rights to the club. Just over two years later he sold Wave FC at a then league high $120 million valuation.

Current NWSL commissioner Jessica Berman reflected on how scarcity has driven club valuations for the league.

“Just four years ago our league was ten teams and expansion teams sold for $5 million,” she said. “We just sold team eighteen for $205 million. That’s a pretty good growth trajectory. The reason that has occurred is, number one, people are smart enough to understand the scarcity and they can look to the men’s leagues to replicate that, if we really invest in this as a proper business and not look at it as charity or philanthropy–which has been the case historically in women’s sports–it could follow the same growth trajectory that men’s sports has.”

Media Opportunities

One of the biggest factors driving rising sports teams valuations makes obvious why media leaders like Bay and Iger would want to purchase a professional sports team. Armed with unmatched understanding of the media industry–Bay is the Dean of the University of Southern California’s Annenberg School of Communication and Iger is the former CEO of The Walt Disney Company–the couple recognized the media opportunities that could be leveraged around the team.

Jeff Wilbur is the Head of Sports and Entertainment at Eldridge Capital Management, where he helps drive the company’s sport industry investment strategy. For Wilbur, the media opportunities generable from sports teams are weighed in investment decisions.

“Fundamentally, we underwrite sports investing like we would underwrite any other asset class,” Wilbur said. “So, we are thinking about a macro investment thesis. We are thinking about the business levers, growth drivers, profitability and environment of the league. For an opportunity like Chelsea, we would think about the value of media rights in sports, the macro trends around global soccer, and unique factors around the club that we think we can further grow and commercialize while putting a competitive product on the pitch.”

Content generation is one such commercialization factor.

“Athletes now through social media can have direct relationships with fans,” Wilbur said. “The athletes have more followers than most teams in most leagues. So, you have to come up with a content strategy that can incorporate the personalities of the athletes in an authentic way and think about the storytelling that you can do between match games.”

Commercialization of content can drive sports team investment.

Wilbur expanded, “As we think about investment opportunities, it’s, ‘What platforms are leveraging social media and the tools? How can you partner with athletes who have a voice now and use that authentically in partnership with leagues, teams and IP holders?'”

Wilbur encourages leagues and athletes alike to more broadly consider how media drives investiture into their respective products.

“There is an interesting opportunity where athletes are connected to culture, music and fashion and some of them are more comfortable as personalities creating content,” he said. “It doesn’t have to be the greatest basketball or football player to make really interesting content. You might actually find the really engaging content in the right medium where you can connect the natural, engaging storyteller to other forms of entertainment.”

Commercialization Prospects

Beyond media opportunities, investors must weigh the ability to commercialize the entire sport product through a prospective team. The sport product can be considered a bundle of rights that can be leveraged to generate revenue. Recognized elements of the sport product are the competition itself, providing fans a way to separate from ordinary life, the rules governing the respective sport, athletes’ unique strength and prowess, and the team’s facilities.

Increasingly, investors are recognizing the importance of facilities in generating value. Such savvy investors recognize that driving profit from a sports team isn’t merely about fielding successful results on the field of play, but holding and leveraging associated real estate assets.

“It is hard to grow a business when your business is supported by a landlord and you are a tenant,” the NWSL’s Berman said. “That means you wouldn’t control your investment, your revenue streams, the experience around the fans, where they park and what kind of amenities they have available. It also means you won’t have control over when and how merchandise is sold, the concessions fans are eating, the locker rooms your players are using and what the signage looks like. All of those things matter to professionalize the products and it’s the reason in our last investment round for expansion that we prioritized admitting two teams that were building purpose-built stadium infrastructure.”

Berman believes that the NWSL’s commitment to investing in facilities will help drive future valuation growth for the league.

“It turns out that athletes need professional facilities to perform as professional athletes,” Berman remarked. “This should not be novel, but it is in women’s sports. The investment thesis that has underpinned men’s sports started with that. The infrastructure around the NFL, NBA and MLB happened fifty years ago and was associated with a tremendous amount of public investment–public support and public subsidies. Of course, times have changed, money is tighter and there’s even more scrutiny on those types of public-private partnerships, but there’s no reason why those same investments shouldn’t be available when these are community assets that exist in support of creating positive experiences for communities.”