Barring any last-minute changes, the Washington Commanders will end the day with new owners, and Dan Snyder will end the day with a lot more cash in his bank account.
The new ownership group, led by Devils and 76ers co-owner Josh Harris, is set to pay $6.05 billion to purchase the NFL team, by far the most ever paid for a sports franchise. It’ll be a lucrative exit for Snyder, who led a group that paid a then-record $800 million to purchase the team back in 1999.
At a quick glance, the $6-plus billion return looks like an all-time investment haul, one customary of what we’ve come to see with recent sports sales. But what was Snyder’s actual annual return on the Commanders? And did he dramatically outpace more standard investment opportunities? Sportico looked at the numbers.
Taken at face value, the compound annual growth rate on $800 million to $6.05 billion over 24 years is about 8.8%. That’s a good number, but nowhere near the rough-calculation CAGR for other recent franchise sales. The 2014 sale of the Buffalo Bills, for example, carried a CAGR of 22% for the Wilson family. Recent sales of the Phoenix Suns (12.9%), Ottawa Senators (12.4%), Denver Broncos (11.4%) and Carolina Panthers (10.1%) are also significantly higher.
Had Snyder put $800 million in a simple S&P 500 index fund back in 1999 and reinvested all dividends, he’d have about $4.4 billion today, an annual return of 7.4%. That includes the massive dip that would have immediately followed the investment, when the S&P had its first three-year stretch of consecutive negative returns since the Great Depression. A 30-year treasury bill from the U.S. government back in 1999 had a yield of 5.87%.
Of course, sports team acquisitions are never as simple as government bonds or mutual funds. That’s particularly true of Snyder’s Washington ownership, which has included years of substantial profits and multiple loans, plus limited partners coming and going.
In fact, there’s good reason to believe that Snyder’s true annual return was quite a bit higher. (A representative for the team didn’t immediately respond to an email seeking comment on financial specifics.)
For one thing, Snyder himself put very little down in the initial purchase of the franchise. According to someone familiar with the transaction, Snyder paid just $120 million in cash back in 1999, utilizing a $340 million loan from Société Générale, plus additional money from family members and limited partners.
Debt on the team also changes the CAGR calculation. The team had nearly $200 million of debt when Snyder’s group made its $800 million purchase, according to someone familiar with the details. The team’s debt in the $6.05 billion purchase is roughly $1 billion, another source said—the NFL debt limit for established owners is $600 million, but Snyder received a special debt waiver from the NFL to borrow $450 million as part of a deal to buy out his limited partners. The CAGR on $600 million to $5.05 billion over 24 years is 9.3%.
Then there’s the limited partners. The Snyder family owned 100% of the team at the end of his tenure, but that wasn’t always the case. In addition to the LPs involved in the initial purchase, a trio of prominent backers—FedEx founder Fred Smith, local real estate executive Dwight Schar and Florida insurance exec Robert Rothman—paid $225 million total to buy into the team in 2003, according to someone familiar with the details. The Washington Post said at the time that Snyder would use the proceeds to pay down the debt tied to the team, which had risen to about $450 million. It’s unclear when or how, but that trio eventually expanded their equity to about 40%.
Snyder’s best deal likely wasn’t the $800 million valuation from 1999 but the deal he cut two years ago to buy out Smith, Schar and Rothman. The relationship between Snyder and LPs grew extremely toxic over the years—including a legal battle after the trio tried to sell their equity to other investors—and in 2021, Snyder agreed to buy their collective 40.5% of the team for about $875 million. It was a dramatic discount from the team’s actual valuation—at the time Sportico valued the Commanders at $3.58 billion.
Because of the various loans and transactions, calculating a more detailed CAGR for Snyder’s Commanders ownership is too complex. Also, none of this CAGR math takes into account profits that came from annual operations of the franchise. Washington was the most valuable franchise in the NFL when Snyder took over, and for years it led the NFL in ticket sales and other local revenue categories. (That changed dramatically over the past decade as fans turned away from the team in droves following numerous scandals involving workplace harassment and financial impropriety.)
Snyder also enriched himself in non-traditional ways over the course of his ownership. For example, he took a $10 million annual salary and had the franchise pay him $4.5 million to have the team logo emblazoned on his personal jet—Snyder called it an “advertising fee,” according to documents obtained by ESPN. A long-awaited report from former SEC chair Mary Jo White, which the NFL formally released Thursday, also detailed how Snyder withheld $11 million in team revenue that should have been shared with the rest of the NFL.
There are also additional costs. Snyder has likely spent millions on various lawsuits related to those allegations (and others) during his tenure, and on Thursday the NFL said he agreed to pay the league $60 million to resolve details from the Mary Jo White report. Some of those lawsuits likely continue long after he steps away from the team.