The NBA appears to be moving closer to expansion, with commissioner Adam Silver acknowledging the likelihood. After finalizing a new collective bargaining agreement with the NBPA last April, the league is now navigating its media-rights deals before delving into expansion discussions.
Potential buyers are already showing interest, organizing and preparing for the possibility of acquiring expansion franchises. Despite no official process in place, sports investment bankers speculate on a timeline, anticipating a transaction as early as late 2024 or 2025.
City Choices and Infrastructure Boosts
The decision to expand hinges on the current team owners, who must weigh personal and financial factors. The upcoming media-rights deal, expected to surpass the current $2.7 billion per season, will significantly influence owners’ considerations.
Cities like Seattle and Las Vegas emerge as prime candidates for new teams. Silver has also mentioned Mexico City, Montreal, and Vancouver as interested locations. While Mexico City presents an opportunity to tap into a changing media landscape, concerns about player security and currency exchange persist. In Las Vegas, where the NBA already has a presence with events like the Summer League, plans for an NBA-ready arena are underway, fueled by a $3 billion federal funding boost for a high-speed rail.
LeBron James has expressed interest in owning an NBA team in Las Vegas, adding to the intrigue surrounding potential ownership groups. Seattle, with its strong market and the success of the NHL’s Seattle Kraken, also makes a compelling case.
The cost of new franchises is expected to be substantial, with bidding starting at $4 billion and potentially reaching $5 billion or more. The NBA faces pressure to keep valuations rising, leading to speculation about changes in ownership rules to accommodate the evolving landscape of team ownership.
If the league decides to expand, it would mark the first addition of a franchise in over two decades. While a specific timeline remains uncertain, Silver emphasizes the importance of growing the league, signaling a careful and deliberate approach to expansion.