Pimlico Race Course

A savior for state’s racing industry?

By Liz Farmer
Daily Record Business Writer

Penn National Gaming’s new stake in the Maryland racing scene could be a saving grace for the sport that’s been on the decline in this state for the last decade — but the deal’s impact will depend on whether the company can bring slots to Laurel Park.

 “They’re a very financially stable company and they have a history in racing,” said Maryland Jockey Club President Tom Chuckas. “I think the future for racing looks better than it has in a long, long time.”

After more than a year of operating in bankruptcy, Magna Entertainment Corp. transferred the jockey club (which operates Laurel and Pimlico Race Course) to Ontario-based MI Developments Inc., its parent company. On Friday, MID announced a deal in which Penn National, known in the industry as one of the pioneers of race track casinos, would acquire an interest in the jockey club.

Md. Racing Commission approves transfer of Laurel and Pimlico

By Liz Farmer
Daily Record Business Writer

MI Developments consultant Ed Hannah (left), CEO Dennis Mills (center) and Chief Financial Officer Rocco Liscio testify Thursday before the Maryland Racing Commission.

The Maryland Racing Commission Thursday approved the transfer of Laurel and Pimlico race tracks to MI Developments Inc., whose CEO committed to bringing the businesses to a break-even status within two years.

The approval was issued three days after a bankruptcy judge gave approval of Ontario-based Magna Entertainment Corp.’s reorganization plan that includes the transfer of five of its tracks and other assets to MID, its parent company, in exchange for the payment of debts and settlements.

CEO Dennis Mills said after the commission meeting, which was held at the Pimlico Race Course clubhouse and overlooked preparations being made for the 135th Preakness Stakes, he hoped to bring the properties to financial solvency quickly.

“Two years is the max, but we want to get [them] to break-even within months,” he said.

Judge OKs transfer of Laurel and Pimlico

By Liz Farmer
Daily Record Business Writer

WILMINGTON, Del. — A judge Monday approved Magna Entertainment Corp.’s reorganization plan, which includes the transfer of Maryland’s race tracks to parent company MI Developments Inc.

That means that by the time the Preakness Stakes is run on May 15, Pimlico Race Course will be under new ownership for the first time in nearly eight years.

MID hopes to take ownership of five tracks, including Laurel Park and Pimlico in Maryland, by Friday night pending gaming licensing approval in Florida, according Magna attorney Brian Rosen.

Rosen said after the Monday hearing in U.S. Bankruptcy Court in Delaware that Magna would agree to the language changes in the track’s confirmation plan outlined in Judge Mary F. Walrath’s ruling.

“We’re all going to get it done,” said Rosen, when asked how fast Magna could work to get the necessary changes by the end of the week.

Parent company reaches agreement to buy Laurel, Pimlico before auction

By Liz Farmer
Daily Record Business Writer

To obtain Pimlico Race Course and the rest of Magna’s Maryland assets, MI Developments will pay out about $114 million, including $89 million to settle a lawsuit filed by Magna’s unsecured creditors committee.Maryland’s race tracks have again been yanked off the auction block — this time because their owner has reached an agreement to sell them to its parent company.

Ontario-based Magna Entertainment Corp. on Tuesday notified the six parties who were to bid on the properties, which include Pimlico Race Course and Laurel Park, that Thursday’s auction was canceled.

Magna parent MI Developments will pay $89 million to settle a lawsuit filed by Magna’s unsecured creditors committee. That money will be used to pay general unsecured claims against Magna.

MID also will pay about $13 million to cover secured claims of PNC Bank, about $6 million for holders of unsecured claims against the Maryland Jockey Club and $5 million to the former owners of Laurel Park and Pimlico.

A hand-wringing wait over the future of Magna’s Md. tracks

By Liz Farmer
Daily Record Business Writer

When the parent of Maryland’s thoroughbred racetracks filed for bankruptcy and announced it would sell its Maryland properties, it sent a wave of uncertainty, fear and frustration though the state’s horse racing community.

Exactly one year later, some say it’s gotten messier.

Since it filed for bankruptcy on March 5, 2009, Ontario-based Magna Entertainment Corp. placed Laurel Park, Pimlico Race Course and Bowie Training Center on the auction block, took them off last spring, then put them up back up for auction again last fall.

The company has delayed its Maryland assets auction three times in the last two months, with the latest reschedule — March 25 — adding to the feeling of instability.

It’s been a hand-wringing wait for those on the sidelines.

Auction for Laurel, Pimlico is pushed back to Feb. 10

By Liz Farmer
Daily Record Business Writer

The auction of Maryland’s thoroughbred race tracks has been delayed for the second time, and is now scheduled for three months before the state’s biggest racing day of the year — the Preakness Stakes.

The fate of Pimlico Race Course and Laurel Park is now scheduled to be decided Feb. 10, according to a motion to delay the auction filed by Magna Entertainment Corp., the company that owns the tracks.

Magna’s attorneys did not give a reason for the delay in the filing and did not return requests for comment.

Cordish, De Francis submit bids for Md. tracks

By Liz Farmer
Daily Record Legal Affairs Writer 

Baltimore developer David Cordish and former track owner Joseph De Francis are among a handful of bidders for Maryland’s two thoroughbred tracks up for auction next month.

Cordish confirmed in an e-mail Monday morning he had submitted a bid for Laurel Park and Pimlico Race Course last week. The tracks are owned by the Magna Entertainment Corp., a Canadian company that declared bankruptcy in March.

Jonathan Cordish, vice president of The Cordish Cos., said Cordish’s bid does not include a plan to bring slots to Laurel Park. Cordish won a bid to build a slots casino near Arundel Mills, but the company’s plans are still subject to zoning approval by the Anne Arundel County Council. The council is schedule to take that vote on Dec. 21.

Jan. 8 set for auction of Pimlico and Laurel Park tracks

Brian S. Rosen (left), the attorney for Magna, after a hearing in Delaware this year.A bankruptcy judge has approved Jan. 8 for the auction of Maryland’s thoroughbred race tracks, and a former owner could be among the potential bidders for the properties.

Joseph De Francis, whose family sold controlling interest in Laurel Park and Pimlico Race Course to Magna Entertainment Corp. in 2002, objected through his attorney to the three-month timetable of the proposed bidding process and auction.

The U.S. Bankruptcy Court in Delaware ruled in favor of Magna’s proposal at a hearing Wednesday morning. Bids are due Nov. 2 and the auction will be held Jan. 8.

An attorney for Magna, which filed for bankruptcy in March, said De Francis had been in touch with the Ontario-based company for several months about his interest in the tracks.

“But I don’t think [his proposals] had much substance and we look forward to selling for more real money,” Brian S. Rosen said after the hearing. Rosen added it was likely that De Francis would submit a bid in November.

De Francis said he was “disappointed” by that characterization.

Verstandig wants ‘Disney’ of racing for Md. tracks

Pikesville developer Carl Verstandig said Tuesday he plans to bid on Maryland’s two thoroughbred race tracks, which were placed back on the auction block just days ago, and would spend more than $20 million on renovating the historic venues.

Verstandig said he never lost interest after Laurel Park and Pimlico Race Course were pulled off the list of assets up for auction this spring by their bankrupt owner, Ontario-based Magna Entertainment Corp. Magna requested to place the Maryland properties (and properties in California and Florida) back up for auction in a federal bankruptcy court filing Friday.

“We’re back into it,” said Verstandig, whose company, America’s Realty LLC, redevelops shopping centers in the Baltimore area.

Verstandig said he and his West Coast-based silent partner who owns 14 tracks across the country plan to invest $12 million to $15 million in renovating Pimlico, home of the Preakness Stakes, the second jewel of racing’s Triple Crown.

Renovations would include adding two white-tablecloth restaurants from California and three casual dining or fast-food establishments owned by local entrepreneurs.

Average bet amount at Pimlico up nearly 9 percent

Daily Record Business Writer
May 27, 2009 7:49 PM

Thanks to heavy betting on the Preakness Stakes, the average amount wagered this spring at Pimlico Race Course jumped nearly 9 percent despite declines in attendance and total handle for the track.

Total wagering fell $4.1 million or 2.5 percent over 20 live racing days — 11 fewer than last year — to $159.5 million. Attendance fell 17.8 percent to 271,031 for the spring meet, held April 18 to May 23.

The average daily handle, however, rose from $6.3 million to $6.9 million over 20 days of racing and 21 days of simulcast racing.

The Maryland Jockey Club credited Preakness, the second jewel of the Triple Crown, for the upswing.

“The buildup to the Preakness was nothing short of spectacular and the race lived up to the hype,” Tom Chuckas, president and chief operating officer of the jockey club, said in a statement.

The long road to uncertainty

Daily Record Business Writer
May 14, 2009 6:57 PM

On a typical Saturday at Pimlico Race Course, longtime Maryland horse racing reporter Dale Austin could walk into the racetrack’s press box and find it flooded with at least 25 or 30 reporters.

“Pimlico was a red-hot place, the hottest in the East,” said Austin, who covered racing for The Baltimore Sun for 29 years. “You could go up to a window in Washington to get a ticket the day of a Redskins game, and, except for Opening Day, you couldn’t fill up the ballpark for baseball games. But there’d be 20,000 people at the racetrack in Maryland.”

But that was in 1962.

And since that time, perhaps the only thing that the horse racing industry nationwide and in Maryland has done is consistently miss the boat, falling further into obscurity and an uncertain future.

Pimlico, Laurel, Preakness out of auction, but not off the block

Daily Record Business Writer
May 4, 2009 1:56 PM

WILMINGTON, Del. – Although Maryland’s thoroughbred racetracks and the Preakness Stakes have been scratched from the auction block, the tracks’ bankrupt owner and its creditors would still entertain bids for the properties, their attorneys told a Delaware bankruptcy judge Monday.

Maga Entertainment attorney Brian S. Rosen (left) and Kenneth H. Eckstein, who represents the company’s unsecured creditors, after Monday’s bankruptcy hearing.“By no means are we abandoning the possibility that we can sell those assets in the future,” said Magna Entertainment Corp. attorney Brian S. Rosen of New York-based Weil, Gotshal & Manges LLP. “We are going to permit parties to do due diligence, and in the extent that a bid comes in that is attractive, the debtors will consider it.”

Kenneth H. Eckstein, who represents the unsecured creditors committee, said that although Magna was withdrawing some highly prized assets from its auction plan — namely, Pimlico Race Course, Laurel Park and the Preakness — the group approved of streamlining the process for now.

Magna removes Laurel, Pimlico and Preakness from auction list

Daily Record Business Writer
May 1, 2009 6:43 PM

In a last-minute move, Magna Entertainment Corp. has taken Maryland’s thoroughbred racetracks and the Preakness Stakes off the auction block, but city and state officials remain cautious about the future of those properties here.

Magna, which had included Laurel and Pimlico racetracks and the Preakness in its list of assets it wanted to auction, has removed those properties from its assets up for sale in its revised auction procedures proposal submitted late Friday afternoon.

The properties belong to the Maryland Jockey Club, which was the Magna asset removed from the auction proposal. The Bowie Training Center in Prince George’s County is also no longer up for auction.

“We are still looking at our alternatives with respect to those assets, and it is unclear what value can be generated,” said Magna’s attorney, Brian S. Rosen of Weil, Gotshal & Manges LLP in New York. “Pimlico, with the Preakness, for 364 days a year it lives on that one day a year, and we’re trying to see if there something else that can be done to those assets.”

That includes looking at slots options and further discussions with the state, Rosen said.

Preakness ticket sales down 12%

Daily Record Business Writer
April 23, 2009 5:31 PM

With just over three weeks to go, ticket sales for the Preakness Stakes — Maryland racing’s biggest moneymaker — are down 12 percent, according to the Maryland Jockey Club.

While some blame the economy, others say the new policy banning outside alcohol and other beverages from the infield may be playing a part, despite the fact that the ticket price has not increased for the May 16 race.

“I think it’ll be fine, but they might suffer from that a little bit,” said Lee Corrigan, of Elkridge-based Corrigan Sports Enterprises, who is organizing the InfieldFEST event. “It’s a tough year and financial market to be doing what they’re doing, but I think they had to for many reasons.”

Magna can’t bundle properties

Daily Record Business Writer
April 20, 2009 8:31 PM

The state’s position in its fight to keep the Preakness Stakes got a little stronger Monday after a judge ruled that Magna Entertainment Corp.’s Maryland properties could not be bundled with its out-of-state properties in the bankruptcy auction process.

If bankruptcy judge Mary F. Walrath hadn’t ruled in Maryland’s favor, there’s no way the state could have matched bids for the Preakness, Pimlico Race Course and Laurel Park, said Raquel Guillory, spokeswoman for the Office of the Attorney General.

“It seems clear that the company is now seriously taking into account the importance of the state’s regulatory and public interest of the racing industry here in the state and it’s certainly a welcome move,” she said.

Preakness is a trademark of the Triple Crown

Daily Record Business Writer
April 16, 2009 8:15 PM

Despite the recent efforts to keep the Preakness Stakes at Pimlico Race Course, the race’s status as the second leg of the Triple Crown is only loosely protected by a marketing group and trademark that do not legally bind it to any state.

The Kentucky Derby, Preakness Stakes and the Belmont Stakes have been referred to as the Triple Crown races since the 1930s. But their official designation as such and the Triple Crown trophy didn’t begin until 1950.And at least one member of that group is concerned about a new owner’s potential impact on the Triple Crown brand.

“I would argue that if you were to move the Preakness from Pimlico you would have a new construct, and you might still call it the Triple Crown, but I wouldn’t call it the Triple Crown,” said Charles Hayward, president and CEO of the New York Racing Association Inc., which owns the Belmont Stakes. “We’re watching this very closely.”

Technically, a developer could buy Preakness and Pimlico but still move the race to an out-of-state track without violating the articles of incorporation of Louisville-based Triple Crown Productions LLC or the Triple Crown trademark.

City officials look for legal ways to keep Preakness at Pimlico

Daily Record Business Writer
April 10, 2009 3:54 PM

In an attempt to secure Pimlico Race Course’s future as host track of the Preakness Stakes, Baltimore officials are looking at other legal avenues to give the future owner more incentive to keep the race there.

According to City Solicitor George Nilson, the city is considering changing the track’s zoning designation to allow for retail and mixed-use properties to increase the value of the 116-acre site — but there’s a catch.

The winning bidder for the track must plan on keeping Preakness, the second leg of racing’s Triple Crown and the industry’s biggest moneymaker in the state, at Pimlico.

“It’s a big piece of land and it’s underutilized space — generally used once a year as parking for Preakness,” Nilson said last week. “There are commercial uses that could be put on the property ... that would create more density and more variety of uses while being sensitive to neighborhood ... and we’d make that available if the owner were to continue to run Preakness there.”

Nilson said city officials planned to meet this week to discuss more specific possibilities and that their next move had not been finalized yet.

Legislation seeks to keep Preakness in Maryland

Daily Record Business Writers
April 8, 2009 9:36 AM

ANNAPOLIS — Gov. Martin O’Malley on Wednesday began a late-session push for stronger state control over the fates of Pimlico and Laurel racetracks and the Preakness Stakes.

All three properties are owned by Magna Entertainment Corp., which has filed for federal bankruptcy protection in Delaware. The company is asking for an auction of its assets, including the Maryland tracks, on July 30, and uncertainty over the future of the Preakness — the second jewel in horse racing’s Triple Crown — has raised increasing concern with city and state officials.

A bill proposed by O’Malley and introduced Wednesday would give the state power to seize the tracks through eminent domain, and would also give the Maryland Economic Development Corp. the authority to issue debt to buy the tracks. The state already has the right of first refusal over the sale of Preakness, but some are concerned about how that would play out in bankruptcy court.

Tracks draw interest from 2 prominent Baltimoreans

Daily Record Business Writer
April 2, 2009 6:21 PM

With another Baltimorean showing interest in rescuing Laurel Park and Pimlico Race Course, keeping the Preakness Stakes from leaving the state may easier than solving the long-term problems of the Maryland racing industry.

“The state is going to have to come to grips with how to save racing in the state — we can’t just do it with keeping 40 racing days at Laurel and one race [Preakness] at Pimlico,” Alan Foreman, general counsel for the Maryland Thoroughbred Horsemen’s Association, said Thursday.

A spokesman for Baltimore developer David S. Cordish said Thursday that Cordish plans to bid for Pimlico, Laurel, the Preakness and the Bowie Training Center, which Magna Entertainment Corp. has put up for sale. Magna, more than $553 million in debt when it declared bankruptcy on March 5, is accepting bids for its assets until July 8.

Orioles owner Peter G. Angelos also met with state officials last month to offer his help in ensuring the second jewel of racing’s Triple Crown stays here.

Senate President Miller: Buy Preakness, build track if Magna sells

Daily Record Business Writer
March 17, 2009 8:05 PM

Maryland Senate President Thomas V. Mike Miller Jr. said Tuesday that the state should consider building a racetrack and buying the Preakness Stakes if Pimlico’s bankrupt owner is forced to sell it.

Alan Forman, general council for the Maryland Thoroughbred Horseman's Association, speaks to the Maryland Racing Commission during Tuesday’s meeting at Laurel. Commission Chairman John B. Franzone, left, and Commissioner Louis Ulman listen.But at a meeting of the Maryland Racing Commission later in the day, Maryland Jockey Club owner Tom Chukas said it is “business as usual” right now.

“The bottom line is Maryland live racing will continue, simulcasting will continue and Preakness will continue,” he said.

Chuckas noted that since parent company Magna Entertainment Corp. declared bankruptcy on March 5, the Jockey Club has received a $13.4 million loan to continue operations while the corporation reorganizes.

Miller, D-Calvert and Prince George’s, told reporters Tuesday morning that building a track and buying the Preakness, by far Pimlico Race Course’s biggest money-maker, would be “last ditch” options the state might have to consider to keep Preakness here.

Racing is important to Maryland, Miller added, pointing to stories about George Washington coming from Virginia to wager on horses in Annapolis.