When creating an app, you can choose to make it available to the public or members of a specific team. In the Developer Portal, this choice is referred to as the app's distribution.
You can't directly change an app's distribution after creating it. If you create a public app, it is always a public app, and if you create a team app, it is always restricted to members of that particular team.
To bypass this limitation:
Create a new app via the Developer Portal.
Under the Who is this app for heading, select the desired distribution type.
Manually copy the metadata from the original app to the new app.