It has been a while since I spent a lot of time commenting on horseracing. At one point in US history, horseracing, boxing and baseball dominated the sports landscape. Over the past 3 or 4 decades, boxing and horseracing have gone into eclipse; baseball remains popular, but folks wonder if short-attention spanned millennials will keep the fan base as large as it is.
Two things contributed significantly to the popularity of horseracing in the US in the 20th century:
- The racetrack was the only place outside of Las Vegas or Reno where one could legally make a wager.
- There were a manageable number of significant races sprinkled around the calendar and all the best horses showed up to try to win them. Today, there are so many stakes races at so many tracks on just about every weekend of the year that the best horses can effectively dodge one another most of the time.
The legalization of sports betting as a result of the Supreme Court decision declaring PASPA unconstitutional may give horseracing a boost in popularity. Racetracks have an infrastructure in place to handle wagering and to handle large amounts of cash; they do not have to build a new “casino” to accomplish that status. That is why in many of the States where sports betting is beginning to spread, racetracks are early venues for bettors to get their action down on games. This may be a short-term fix for racetracks because it appears that one of the directions for sports wagering is to do it all on mobile phones with a variety of apps.
In any event, the immediate uptick in racetrack fortunes has generated some “investment interest” for the short term. After a 4-year period of darkness, Colonial Downs in New Kent County, VA will reopen for live racing in 2019. There will be 15 days of live racing in August and September; the folks who will run this enterprise, Colonial Downs Group, has committed to invest $300M in the facility and the staging of the races. The expectation is that Colonial Downs will create 800 new jobs for that part of the Commonwealth.
I hope these folks succeed – but I have a significant doubt. It is the same doubt that was in my mind the day the State regulators decided to put the one-and-only racetrack in the State in New Kent County. It is not the best venue for a racetrack. New Kent County is between Richmond and Williamsburg; it is not a population center; it is not a part of Virginia where the folks living there have lots of disposable income to spend on racing. Data:
- The population of Richmond – about 30 miles from the track – is 220,000. If you draw the circle wide enough, the Richmond Metro Area has a population of just over 1 million.
- In Northern Virginia there are lots more people (1.1 million in Fairfax County alone) and these are some of the counties with the highest average income per year in the entire US. From my home in Falls Church, VA to Colonial Downs is a drive of about 125 miles on a VERY heavily traveled portion of Interstate 95; it’s about a 2 hour drive each way for me to attend racing there.
- Another major metro area in Virginia is the Tidewater Region made up of Hampton Roads, Newport News, Virginia Beach and Norfolk. The Metro Region there has about 1.7 million residents. Colonial Downs is 65-75 miles away from this population center on a crowded portion of Interstate 64; I would guess that it is a 90-minute drive each way to get to the track.
There were lots of folks in the State Legislature who opposed allowing pari-mutuel betting in Virginia; when they lost that battle, they seemed to turn their attention to locating the track in as disadvantageous a place as possible. They did not quite succeed in that endeavor; after all the Great Dismal Swamp in southeastern VA would clearly have been a worse venue, but they did pick a place where the track would struggle to survive – as it has since it opened for the first time in 1997.
The other piece of investment news related to horseracing is also in this eastern part of the US close to where I live. Several years ago, there was a study done that said it would take $300M to renovate and upgrade Pimlico Race Course in Baltimore, site of the Preakness every May. I said back then that I could not imagine anyone investing that kind of money in a facility that sits in the neighborhood that I have to drive through to get to the track; several Baltimore residents challenged that assertion and said that the area was ripe for gentrification.
Well, the track and the facility were never upgraded much beyond a new coat of paint here and there. I described Pimlico as an upholstered toilet in the past; from all reports that label is still appropriate. And now there is a new study…
It seems as if the price tag for upgrading Pimlico to the point where the Preakness can continue to be contested there has gone up; now the estimated cost is $424M. [Aside: Odds on the project coming in at cost or below cost are 99-1 at a minimum.] The folks who own Pimlico also own Laurel Race Course about 30 miles away. Those folks have been spending money to upgrade Laurel for about 10 years now and they are not particularly interested in also spending big bucks to upgrade another nearby facility that is threadbare to say the least. The owners say that if there is public money available to do the Pimlico “spiffing up” that would be just fine with them. The mayor of Baltimore has already announced that “state money” – probably via the Maryland Racing Authority would have to be part of this project.
And so, the dance continues… The track owners are happy to keep investing in Laurel Race Course which was a much nicer facility than Pimlico was when they made the decision to work on Laurel and keep Pimlico as its stepchild. [Aside: Racetracks sit on large tracts of land and Pimlico is inside the Baltimore city limits. If indeed that neighborhood is “ready for gentrification” that land tract may be a whole lot more valuable without stables and a grandstand on it. Just saying…]
I do not think that either of these happenings/infusions of capital indicate the resurgence of horseracing in the US. Nor do I think that these racetrack facilities are going to be centers of sports wagering in the long term. But for now, there is an uptick of interest in track facilities – – so long as they are more inviting than the Black Hole of Calcutta.
Finally, Scott Ostler of the SF Chronicle posed an interesting question there several weeks ago:
“Hey, Jim Morrison of The Doors. What’s a ‘mire’? If there’s no time to wallow in the mire, can we just wade in it?”
But don’t get me wrong, I love sports………