Bucks Owners Continue to Cash In
Team's value now $2.3 billion, a 5-fold increase in value in 8 years, with big help from taxpayers.
Pro sports owners never lose money. Even if there are occasional seasons that lose money, that’s soon made up by the incredible escalation in the value of the team.
Case in point: the Milwaukee Bucks. When principal owners and hedge-fund billionaires Wes Edens and Marc Lasry bought the team for $550 million in April 2014, some thought they had paid too much. Just three months earlier, Forbes magazine had estimated the team’s value at $405 million. And nearly a year before this, the Sacramento Kings, in a larger market, were sold for $535 million.
In fact, the sales price for the Bucks was really $450 million because former owner Herb Kohl promised to pay $100 million for a new arena as part of the deal, which put the net purchase price just a bit higher than the Forbes estimate.
But all that was chump change compared to how much the value of the franchise has grown since then. The latest ranking by Forbes shows the Bucks team is now worth a cool $2.3 billion.
That’s a 21% increase in value in one year. That’s a five-fold increase in value since the team was purchased. And much of that increase is due to the building of a taxpayer-subsidized arena, Fiserv Forum, which opened in 2018. This has helped the Bucks team jump from the least valuable franchise to 15th place, ahead of 10 other NBA teams, including those in far bigger metro areas, like Atlanta, Detroit, Denver, Portland and Cleveland.
But what all the teams have in common is how rich they make their owners. “The NBA is golden,” Forbes reported. “Buying a team today means an owner can quickly begin to pocket cash and never have to put in another dime.”
Then consider the impact of the league’s revenue-sharing formula: “low-revenue teams split nearly $500 million that was pooled from funds that came from a combination of high-revenue teams and luxury-tax payments last season,” the story noted. And some of that big-market income comes partly from the taxpayers in those metro areas, as every other arena beside the one in San Francisco is subsidized.
‘The full cost of the subsidy for Fiserv Forum was estimated at more than $800 million by Urban Milwaukee, paid for mostly by metro-area taxpayers with some state funding. But it turns out the Bucks are also subsidized by taxpayers in other cities, through league revenue sharing from bigger-market teams.
That subsidy helps subsidize the millionaire ballplayers for the Bucks, but most of the resulting profits go to the principal owners: Wes Edens, whose net worth is estimated at $5.1 billion, Marc Lasry, at $1.8 billion and Jamie Dinan, who came aboard as a major investor just a few months after the team was purchased, with a net worth of $1.9 billion.
The owners have also been savvy about bringing aboard minority investors (to build their acceptance in the city’s power structure), including about a dozen or so current or retired corporate executives, all wealthy, led by multimillionaires like Gale Klappa, Jeff Joerres and Ted Kellner. Also added was multi-millionaire athlete Aaron Rodgers.
Then there are those lucky folks who are minority investors in two tax-subsidized teams, both the Bucks and the Milwaukee Brewers: Marc Stern, the chairman of the Los Angeles-based TCW Group, Inc., and Adam Stern, CEO of XO Capital LLC in California.
None of these investors, it seems fair to say, are in need of welfare from the taxpayers.
- Back in the News: Bucks Owners Continue to Cash In - Bruce Murphy - Nov 28th, 2022
- Murphy’s Law: Bucks Subsidy An Issue in US Senate Race - Bruce Murphy - May 9th, 2022
- Murphy’s Law: Bucks Franchise Worth $1.86 Billion - Bruce Murphy - Jan 25th, 2021
- Op Ed: County Parks Lost Funding to Bucks Arena - Patricia Jursik - Jul 7th, 2020
- Eyes on Milwaukee: Fiserv Forum Workers to Get $15/Hour - Jeramey Jannene - Jan 29th, 2020
- Eyes on Milwaukee: Bucks Beat Hiring Targets on Fiserv Forum - Jeramey Jannene - Nov 20th, 2019
- Murphy’s Law: Taxpayers Make Bucks, Brewers Rich - Bruce Murphy - Apr 16th, 2019
- Eyes on Milwaukee: Bucks Unveil Master Plan for Park East - Jeramey Jannene - Mar 15th, 2019
- Eyes on Milwaukee: Bucks Plan Massive Arena Signs - Jeramey Jannene - Feb 12th, 2019
- Eyes on Milwaukee: Bucks’ New Bar Is “The MECCA” - Jeramey Jannene - Feb 7th, 2019
Read more about New Bucks Arena here