Bonsignore: Was cost of relocating to L.A. worth it for Rams and Chargers?
Neither Rams owner Stan Kroenke nor Chargers owner Dean Spanos raised an eyebrow when fellow NFL owners informed them they’d have to fork over $550 million up front — or more if they opted to pay over 10 years — for the right to move to their teams to the second-biggest market in the country.
Kroenke and Spanos didn’t blink because they knew the financial power of playing in Los Angeles was far stronger than the hefty relocation fee they’d have to pay.
On Wednesday we found out just how powerful it is to call Los Angeles home.
The Rams left St. Louis for L.A. a little more than a year ago, but over those 12 months the value of the franchise has doubled based on Forbes’ annual rankings of the world’s most valuable sports franchises.
After falling outside the top 50 in the rankings last year with a valuation of $1.4 billion, the Rams soared all the way to No. 12 on the 2017 list at $2.9 billion.
And while the Chargers haven’t played a single down in Los Angeles yet — remember, they opted to delay moving to L.A. by one year in order to give a new stadium deal in San Diego one last try – they’re already benefiting from the move.
At this point last year the Chargers sat 44th on the Forbes list with a valuation of $1.525 billion. This year, they’re up eight spots after a 36 percent bump to $2.08 billion. And a continued surge seems likely in future years as the Chargers settle into their new home.
As far as the relocation fees, the Rams and Chargers have until the end of the 2019 season to decide whether to pay it upfront or over a 10-year period. Based on present values, the option of paying over time would mean a $645 million fee as opposed to $550 million.
Jerry Jones’ Dallas Cowboys, by the way, remained the most valuable franchise in the world at $4.2 billion, or $500 million more than the second-place New York Yankees.
As far as other Los Angeles/Orange County pro franchises go, it was no surprise that the Lakers (No. 9 at $3 billion) remained in the top 10 and the Dodgers climbed a spot to No. 13 at $2.75 billion. The Clippers held flat at $2 billion and actually fell 15 spots in the rankings.
But Forbes reported that the Angels had a 31 percent increase in valuation, and they tied for 50th on the list with the New Orleans Saints at $1.75 billion.