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Sports Teams a Tough Sell in Today's Market

I had a conversation with a high-profile owner and asked him what his greatest concern in these tough economic times was.

He told me exactly what I thought I'd hear. With the lack of liquidity in the market, he said, how hard is it going to be to sell a team for the so-called appraised value?

The answer is very hard. It's whyI mentioned last month that the Forbes franchise values are off. Nineteen NFL teams can't be worth more than $1 billion because 19 teams couldn't possibly sell for that much. And the values are actually getting tested sooner than I would have thought.

ESPN's Chris Mortensen reported that the Rams are for sale, but that ownership is holding out to get the $929 million the magazine said it was worth. I've been following the franchise values for a long time and this is the first time that I've ever heard an ownership group saying that they were hoping to get that number. If that's the number they're putting out there, you can bet it's overvalued.

With the credit crunch, it's pretty easy to predict that the next buyer of a sports team is going to be a person who has a lot of cash on hand--not only to buy the team with little help from lenders, but, as this owner pointed out--to front the money for the operating budget as many teams have operating losses.

This all brings me to the Chicago Cubs. Sources told CNBC that, as the markets collapse more, the prospective bidders are trying to figure out how much cash each of them has and how creative they can get. With the Cubs out of the playoffs, you wonder if Sam Zell is going to take the best offer, or if he'll try to pull the team back off the market and hope things clear up.

Questions? Comments? SportsBiz@cnbc.com