According to Jeff Passan of Yahoo Sports, Mets payroll – which he calculates to be $134 million – currently ranks 13th in Major League Baseball. That puts them ahead of the Toronto Blue Jays and the Kansas City Royals.
It´s nice that ownership finally appears willing and able to sport a competitive payroll. Assuming the payroll is actually closer to the $139 million as calculated by Joe D. of Metsmerized Online for Opening Day, it will probably rank closer to 9th or 10th highest in MLB. Still, not what you´d expect from a NYC MLB franchise that just went to the World Series, but certainly not ridiculous anymore. Progress.
That said, this is still a very low risk payroll for ownership – even if the 2016 Mets have a disappointing season (an unlikely event) and fail to even contend for the playoffs deep into the season, let alone get there and advance.
Thanks to the national TV deal that kicked in back in 2014, each MLB franchise gets an additional $30 million per year in revenue that doesn’t cost them an extra cent. So, looking at the cost side, a $140 million payroll in 2016 basically equals a $110 million payroll for 2013 (when Mets opened the year at $93.6 million).
Of course, attendance in 2016 figures to be somewhere in the 2.8 to 3.0 million range – up by well over 600,000 and compared to the 2012 through 2014 range. Even using conservative estimates that´s an extra $30 million in revenue right there. In reality, odds are that luxury seating sales are way up too, so the actual bump figures to be significantly higher.
Still, essentially, the Mets as an isolated entity figure to have roughly $60 million more in revenue (at the very least) compared to the 2013 or 2012 Mets which reportedly generated operating losses of $10 and $20 million with payrolls in the $95 million range. Do the math, and this pretty much is the “break-even” range for ownership.
And in case the Mets do make the playoffs again in 2016, they can generate a nice eight-figure profit again, which they reportedly did in 2015 and which they also managed to do in 2014 when payroll was at a 10-year-low of $85 million. Yet the extra TV money had already kicked in, which led to a reported operating profit of about $25 million – which fits right in with the reported losses in 2013 and 2012 if you do the math. And those profits can go right into ownership´s pockets.
And, most of all, SNY remains the group´s big cash cow. Reports had them generating an EBITDA of over $150 million last year. And that mainly due to getting the Mets local right at a bargain rate of $80 to $100 million below the actual market value. These profits entirely can be used for debt management or can be distributed among owners, assuming some money is left after debt and interest payments.
So, yes, on surface, Mets payroll finally looks fine again. Yet, digging deeper, this remains a rather conservative and low risk figure. SNY is basically a legal money-printing machine that can ultimately help ownership to restore its Mets related wealth – by keeping and not selling the team and the majority shares of SNY which are closely linked together. The Mets are relevant again and can afford to compete in their market which should appease even their harshest payroll critics over the years.
