NBA

Cavaliers double in value with LeBron, past $1 billion mark

Cavaliers owner Dan Gilbert has another reason to thank LeBron James for coming back to Cleveland.

With Friday’s announcement that the four-time MVP will return to his hometown team, the Cavaliers are now valued as a billion-dollar franchise and have nearly doubled in worth, according to several business experts.

In January, Forbes had valued the team at $515 million, the 19th-highest in the NBA. The Knicks, Lakers, Clippers and Bulls are currently the only other teams valued at $1 billion or more.

“Certainly the brand itself, as well as the revenue that the team is able to generate, is much stronger with him — to the point of a billion-dollar franchise,” valuation expert Peter Schwartz, managing director of venture capital at Boston-based Christie & Associates LLC told Bloomberg News.

With the world’s best player, the Cavaliers instantly benefit from merchandising, ticket sales, increased TV exposure and sponsors, with James previously having taken the team from the “low, low, low end” of league revenue to the top 10, according to Chad Estis, a former chief marketing officer of the Cavaliers.

“For a mid-size market, the revenues were outperforming the market,” Estis said. “You get to a point where everything will be sold out, then you increase prices, certainly local sponsors, suite renewal is better if you win and the potential long-term effect for the brand if you win a championship.”

Last season, the Cavaliers ranked 16th in attendance in the NBA, averaging 17,329 fans, but in 2009-10, James’ last season with Cleveland, the team ranked second in the league (20,562). In James’ rookie year, he vaulted the team from 29th to ninth in attendance

Last season, the Cavaliers made only one appearance on ESPN and one on TNT, while the Heat were featured on ABC, ESPN and TNT a combined 25 times.

Everything is about to change.