Value of Miami Heat Franchise Has Soared in Years Following The Signing of LeBron James
Last night, the Miami Heat successfully fended off the very game San Antonio Spurs to win their second straight NBA title.
The series between the Heat and Spurs had everything - multiple interesting storylines, a trip to overtime and an unbelievable come-from-behind victory in Game 6.
In the aftermath of Game 7, one of the biggest smiles belonged to Miami Heat owner Micky Arison. With the Heat securing a second straight victory, the value of the franchise is set to increase even more in the offseason.
Arison, who currently serves as the CEO of Carnival Cruises, took control of the Heat in 1995. The Heat would eventually win a title in 2006, but Arison's biggest coup would be pulling off the signing of LeBron James in the 2010 offseason.
There was a reason why Arison was so overjoyed to be bringing together "The Big Three" (Dwyane Wade, LeBron James, Chris Bosh) in Miami, and it was the same reason why Cleveland Cavaliers owner Dan Gilbert was so furious when LeBron James decided to up and leave. The fact of the matter is that LeBron James prints money for the team that has him under contract.
LeBron James is quoted as saying that he is "underpaid" relative to the value that he brings to a franchise. Quite the statement considering that he was paid $17,545,000 this past year by Micky Arison and the Miami Heat.
The thing is? Lebron is right - he is underpaid.
According to Forbes.com, the Miami Heat were valued at $364 million before LeBron James brought his talents to South Beach.
In their most recent valuation of NBA franchises, Forbes.com put the value of the Miami Heat at $625 million. This is based on last season's numbers, and doesn't account for the fact that the Heat just won a second straight championship. Don't be surprised if the Heat are valued at north of $700 million by next season.
So, assuming that the Heat are currently worth $700 million, this would mean that Micky Arison has seen his asset appreciate by roughly $335 million in just three years. In addition, the Heat are making money, which is also helping to line Arison's pockets. Forbes estimates that the Heat posted revenues of $150 million and operating income of $14.9 million last season, and they likely did even better this year.
Let's look at LeBron's salary for the last three years:
2010-11 - $14,500,000
2011-12 - $16,022,500
2012-13 - $17,545,000
That's a pretty solid investment if you ask me.
The cherry on the sundae for Heat owner Micky Arison?
The Heat's regional TV deal with Fox Sports Florida expires in a couple of years, and there have been rumblings that the two sides may be close to extending their deal. You can be certain that this deal would include a very big raise for the Heat, given their recent jump in exposure and consecutive NBA titles.
Love him or hate him - LeBron James brings in the cash.
Photo: Keith Allison
Filed under: General Knowledge