MLS: Franchises to profit by 2010

The overall health of Major League Soccer is stronger than ever before and new soccer-specific stadiums should vault many teams, including D.C. United, to profitability by the end of the decade, league officials said yesterday.

Commissioner Don Garber and deputy commissioner Ivan Gazidis said although international interest in the league is at an all-time high, they expect to slow expansion plans. Three teams will be added within five years, with league membership settling at 16.

The officials spoke during a series of meetings with United players and staff at RFK Stadium. Washington was their latest stop on a tour of all MLS cities. Today they head to Toronto, where the league’s newest franchise will begin play next year.

The top question lobbed at the two men centered on the league’s financial stability.

“The question really is, ‘When will our teams be profitable?’” Garber said. “At this point, we have some that are, which is a good thing; we have some that are close; and we have some that aren’t.”

Teams expected to show a profit this year include the Los Angeles Galaxy and FC Dallas. Both play in their own soccer-specific stadiums, and Garber said he expects at least 10 teams to have such facilities by 2010.

“Those that are playing as tenants in stadiums that are built for football, or in [United’s] case built for baseball, will never be able to break even,” he said. “We will never be able to have a business that is profitable to our owners unless we own or control our own stadiums.”

United hopes to begin playing in its own new facility at Poplar Point in Southeast by 2008. The team is awaiting the transfer of land from the federal government to the quasi-public Anacostia Waterfront Corp., which is designing a master plan for a mixed-use complex in the area.

Meanwhile, team and league officials are interviewing potential local investors to buy the team from Anschutz Entertainment Group, including several people who have expressed interest in real estate opportunities around the stadium.

“There are people that are interested in buying this team,” Garber said. “It’s different from years ago … there’s interest in this team, and that’s a very positive thing. I really believe this team is going to get sold.”

The league as a whole, meanwhile, is exploring how to add three new teams without creating scheduling and playoff format headaches. MLS formed a committee in November to examine and plan for the league’s competitive format over the next five years. The committee plans to recommend new playoff and scheduling structures for when the league expands to 14 and then 16 teams.

“Everything is on the table, so it could be as dramatic as you can imagine, or maybe the conclusion is that we’re not too far off now,” Gazidis said. “It will be a reasonably lengthy process.”

While the league hashes out its internal issues, it also is looking outward to find opportunities outside the United States.

Austrian energy drink maker Red Bull bought the MetroStars franchise in March and renamed the team the New York Red Bulls as part of a lucrative naming rights deal. Though the name change was controversial, MLS officials touted the purchase as a sign the league was gaining notice overseas.

“There’s clearly a lot of international interest in the league,” Gazidis said. “All of these big international clubs are looking at the U.S. market, and they’re looking at the Chinese market avariciously. We have to be careful how we approach this. If we enter into relationships with overseas clubs, we have to enter into relationships that benefit us, and don’t just benefit the overseas clubs.”

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