The typical NHL franchise is now valued at an impressive $1.79 billion, marking a 37 percent increase in just the past year.
This figure stems from a report published by Sportico on Wednesday, which represents its fourth annual analysis of team valuations across the league.
The Toronto Maple Leafs top the list with a franchise valuation estimated at $3.66 billion (over $5 billion Canadian). This valuation follows Bell’s sale of its 37.5 percent stake in parent company Maple Leaf Sports & Entertainment to Rogers for $3.46 billion USD last month.
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Following the Maple Leafs, the New York Rangers and Montreal Canadiens rank as the next two highest-valued franchises, with valuations of $3.25 billion and $2.93 billion, respectively.
At the lower end of the scale are the smaller-market teams: the Columbus Blue Jackets, Winnipeg Jets, and Buffalo Sabres. Both the Jets and Sabres have faced attendance challenges in recent years, with Winnipeg even making national news due to its struggles last season.
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These three franchises experienced the smallest gains in valuation over the year:
However, a small-market success story has emerged, as the Utah Hockey Club’s relocation from Arizona to Salt Lake City resulted in a remarkable 78 percent increase in its valuation. This rise is partly attributed to owner Ryan Smith’s $1.2 billion acquisition of the struggling franchise.
Other teams that saw substantial gains include the Edmonton Oilers (51 percent), Boston Bruins (50 percent), New York Islanders, and Dallas Stars (both at 49 percent). The establishment of new arenas over the past decade has benefited several teams, including Edmonton (opened in 2016) and Long Island (2021).
Despite these increases, NHL franchise valuations remain significantly lower compared to other high-profile sports leagues, specifically the NFL and NBA. According to Sportico, the average franchise values in these leagues are $5.93 billion and $4 billion, respectively.
The average MLB franchise stands at about $2.64 billion, while the average MLS franchise is valued at $678 million.
A contributing factor to the rising valuations of NHL franchises is the league’s collective bargaining agreement and hard salary cap, which establishes a 50-50 revenue split between teams and players through an escrow system. This cap on player salaries allows owners to have fixed costs, increasing the probability of turning a profit annually.
The robust revenue-sharing system available to smaller-market teams has also helped maintain stability across the league.
Moreover, the NHL’s most recent expansion, which welcomed the Vegas Golden Knights and Seattle Kraken in 2017 and 2021, has played a role in lifting franchise valuations. The Golden Knights acquired their franchise for $500 million, clinched the Stanley Cup in 2023, and are now worth over three times that amount. Only four years later, the Kraken’s expansion fee was considerably higher at $650 million, and its current valuation exceeds $1.44 billion.
This has spurred speculation (including comments from commissioner Gary Bettman) that NHL franchises could surpass $2 billion in worth during the next expansion period.
Interestingly, the NHL’s most valuable teams are also its oldest. The average valuation of the league’s prestigious Original Six franchises stands at $2.8 billion, with all six teams listed among the top 10 in overall valuation, despite the Montreal Canadiens, Chicago Blackhawks, and Detroit Red Wings all being in the midst of rebuilds.
| Valuation | Increase | |
|---|---|---|
The Los Angeles Kings are recognized as the most valuable non-Original Six franchise, having kicked off the NHL’s success in the U.S. Sunbelt during the late 1980s by acquiring Wayne Gretzky from the Oilers.
Despite their smaller market size and not having won a Stanley Cup since 1993, the average Canadian franchise is valued at $2.08 billion, which is 21 percent higher than the average American franchise.
Meanwhile, U.S. franchises are experiencing higher valuation growth rates, indicating that they may narrow this gap in the coming years.
(Top photo of NHL commissioner Gary Bettman with Golden Knights owner Bill Foley: Ethan Miller / Getty Images)
NHL Franchise Values Surge to Record $1.79 Billion: A Year of Unprecedented Growth
Understanding the Surge in NHL Franchise Values
The National Hockey League (NHL) has recently reported a dramatic surge in franchise values, reaching an astonishing average of $1.79 billion per team. This figure marks a record high and reflects an unprecedented growth trajectory that has captivated both sports enthusiasts and investors alike. The surge can be attributed to several interlinked factors including increased media rights deals, growing fan engagement, and the overall expansion of the NHL brand globally.
Factors Contributing to Franchise Value Growth
1. Media Rights Deals
One of the primary drivers behind the increase in NHL franchise values is lucrative media rights deals. The NHL has successfully negotiated contracts that have significantly boosted revenue streams. For example:
- ESPN and Turner Sports Partnership: The NHL’s broadcasting partnership with ESPN and Turner Sports has enhanced visibility and reach, bringing the sport to a wider audience.
- Increased Advertising Revenue: With expanded viewership comes increased advertising revenue, making franchises more valuable.
2. Expanding Fan Engagement
The NHL has made concerted efforts to enhance fan engagement through various initiatives:
- Social Media Presence: Teams have boosted their engagement on platforms like Twitter, Instagram, and TikTok, attracting younger demographics.
- Enhanced Game-Day Experience: Improvements in the game-day experience, including better amenities and entertainment, have drawn more fans to arenas.
3. Global Expansion of the NHL Brand
The NHL’s efforts to globalize its brand have also played a significant role in franchise valuation:
- International Games: Hosting games in Europe and Asia has raised awareness and interest in hockey.
- Increased Participation: Youth hockey programs across the globe have led to a growing base of players and fans.
Impact of COVID-19 and Recovery Trends
The COVID-19 pandemic initially disrupted the NHL and brought about significant challenges. However, as leagues resumed with safety protocols, recovery trends emerged that helped increase franchise values. The following factors underscore this recovery:
- Return to Full Capacity: The return of fans to arenas has revitalized gameday revenues.
- Digital Growth: The shift to digital platforms for viewing games has attracted new audiences and sponsors.
NHL Franchise Value Breakdown
The following table provides a snapshot of the current value of select NHL franchises based on the latest data:
| Team | Estimated Franchise Value (in Billion USD) |
|---|---|
| New York Rangers | 2.0 |
| Toronto Maple Leafs | 2.0 |
| Montreal Canadiens | 1.8 |
| Chicago Blackhawks | 1.6 |
| Los Angeles Kings | 1.5 |
Benefits of Investing in NHL Franchises
For potential investors and stakeholders, the surge in NHL franchise values offers numerous benefits:
- Strong ROI Potential: As values continue to rise, franchises present an attractive return on investment.
- Stable Revenue Streams: Media rights, merchandise sales, and ticket sales provide stable income for franchises.
- Brand Affinity: NHL teams often have loyal fan bases, offering a solid foundation for long-term profitability.
Case Studies: Successful NHL Franchise Strategies
Analyzing successful franchises provides insights into strategies that can drive growth:
Case Study 1: Tampa Bay Lightning
The Tampa Bay Lightning have successfully capitalized on their recent success on the ice by enhancing their off-ice operations:
- Winning Culture: Back-to-back Stanley Cup victories created a buzz and increased fan loyalty.
- Community Engagement: Active involvement in local communities has bolstered support and attendance.
Case Study 2: Vegas Golden Knights
Since their inception, the Vegas Golden Knights have established a unique brand identity:
- Spectacle at Games: The franchise is known for its extravagant pre-game shows that attract not just hockey fans but also tourists.
- Innovative Marketing: Targeting both locals and tourists has helped maintain high attendance rates and merchandise sales.
First-Hand Experience: Fan Perspectives
Fans play a crucial role in the overall valuation of NHL franchises. Here are some insights from avid NHL supporters:
- Community and Belonging: Many fans express that supporting their team fosters a sense of community.
- Digital Engagement: Engagement through social media platforms allows fans to connect with players and teams beyond the game.
Practical Tips for Potential Investors
For those considering investment in NHL franchises, here are some practical tips:
- Conduct Thorough Research: Understand market dynamics, franchise performance, and long-term potential.
- Engage with Fans: Gauge fan sentiment and loyalty as they are integral to franchise success.
- Monitor League Developments: Stay informed about NHL’s strategic initiatives that could impact franchise values.
The Future of NHL Franchise Values
Looking ahead, the trajectory for NHL franchise values appears to be on an upward climb. With the continuous expansion of the league’s global footprint, coupled with ongoing media partnerships and enhanced fan experiences, the NHL is poised for future growth. Investors and stakeholders are keenly watching these trends, as the potential for significant returns becomes increasingly evident.
