By Dan Burns NEW YORK (Reuters) - In 1981, Donald Sterling laid out about $12.5 million for a National Basketball Association franchise - a perennial basement dweller then called the San Diego Clippers. It turns out he bought one of the most undervalued assets in memory. Thirty-three years later, as Sterling might be forced to sell the team as punishment by the NBA for racist comments made by him, the club is worth at least $575 million, according to Forbes, which compiles a list of professional sports team values each year. That's 46 times what Sterling paid for the team, now known as the Los Angeles Clippers. In fact, it's likely that is a conservative estimate given that many in the professional sports business view the Forbes estimate as about $100 million too low, according to Robert Boland, professor of sports management at New York University. And should the team go on the block in an auction, it could fetch $1 billion or more, he said. Either way, with a return of at least 4,500 percent over three decades, Sterling's purchase of the Clippers ranks as one of the best-performing investments for many a year - topping even U.S. Secretary of State William Seward's acquisition of Alaska from Russia for a little over 2 cents an acre in 1867. The "Seward's Folly" deal has returned 6.8 percent a year at a compound annual rate based on Alaska's most recent taxable property values. The Clippers have appreciated by more than 12 percent a year. A review of a range of different investments Sterling could have made - stocks, bonds, gold, property, even wine - shows that whether by prescience or plain dumb luck, the Clippers were just about the best choice he could have made. For instance, he has beaten: - Stocks: Since the start of 1981, the Standard & Poor's 500 Index <.SPX> has risen about 1,280 percent, or 8.3 percent a year. Including reinvested dividends, the S&P has delivered a total return <.SPXTR> of 1,462 percent, or 8.7 percent a year. The Nasdaq Composite Index <.IXIC> is up 1,900 percent, or 9.5 percent a year. - Bonds: The Barclays U.S. Aggregate Index <.BCUSA> has risen 1,372 percent, or 8.5 percent a year. - Gold: Spot gold is up 120 percent, or just 2.4 percent a year. It also appears Sterling, who is a lawyer and real estate developer as well as sports team owner, outpaced alternatives such as real estate and wine, though pricey vintages have come close. London-based Liv-ex has tracked fine wine prices since 1988. In that time, its Liv-ex Investables Index is up 1,504 percent, or just under 11 percent a year. Before the launch of the index, prime vintages appreciated by between 5 percent and 10 percent a year based on historical merchants' lists, Liv-ex spokeswoman Miranda Cichy said. Even Manhattan real estate couldn't keep up. Jonathan Miller, of the real estate appraisal firm Miller Samuel, has tracked Big Apple property prices for 25 years. Over that run, a Manhattan apartment has risen from a median of $240,000 in the first quarter of 1989 to $972,000 now, or just 5.75 percent a year. Values in Tribeca, one of the city's top performing neighborhoods, have appreciated about 800 percent in that time, still only 8.2 percent a year. That the Clippers continued to show poorly in the league standings through most of Sterling's ownership is irrelevant, as is whatever modest annual profit or loss it generated, said David Carter, executive director of the Sports Business Institute at the University of Southern California. "Looking at annual profits and losses doesn't really make any sense because (the franchise value) has such long-term upside," Carter said. Teams keep coming up with novel sources of revenue - local cable TV deals, luxury box sales - and that keeps driving valuations higher. "They're entirely an asset appreciation play," NYU's Boland said. Still, there is at least one asset that's outperformed Sterling's Clippers. If he had used the $12.5 million to buy Apple shares at $4.27 each (as adjusted for subsequent splits) at the beginning of 1981 he would now be sitting on around a $1.7 billion investment in the iPhone maker. (Reporting By Dan Burns; Editing by Martin Howell)