08/30/2013 12:17PM

Calder-Gulfstream battle still playing out

Bill Denver/Equi-Photo
Gulfstream is looking to displace Calder at the center of the summer and fall racing calendar in South Florida.

By the numbers, there is no question which Florida track is winning the head-to-head battle this summer between Gulfstream Park and Calder Race Course: It’s Gulfstream, by a wide margin.

It remains uncertain whether either track is winning the war.

Gulfstream and Calder have been running head to head since July, Calder in defense of its traditional dates and Gulfstream in a blatant effort to displace Calder at the center of the summer and fall racing calendar in South Florida. While the combined weekly handle and purse figures at the two tracks are greater than Calder’s individual figures for a four-day racing week last year, many officials wonder if the tracks can afford to continue to run against each other while splitting wagering revenue amongst themselves and, at least in Gulfstream’s case, subsidizing purses.

By all accounts, Calder is taking the worst of it. The track’s average handle is down nearly a third compared with last year, according to figures, and the track recently announced a 12-percent reduction to its overnight purses. What’s more, for the first time in 2013, Calder is no longer the sole reseller of simulcast signals in the state for most of the year, costing the track and its parent company, Churchill Downs Inc., millions of dollars in revenue that had been previously offset by very little expense.

“We feel like they’re going to hang in there,” said Kent Stirling, the executive director of the Florida Horsemen’s Benevolent and Protective Association, when asked if Calder was committed to remaining open. “At least until December.”

Calder is running only three days a week this summer, from Fridays to Sundays. Last year, it conducted racing four days a week. Gulfstream is running only on Saturdays and Sundays, but track officials said that the track plans to add more dates to its weekly schedule as the summer and fall wears on.

During the first two months the tracks have been running head to head, Calder is averaging $1.27 million a day in handle. Gulfstream is averaging more than double that, $2.57 million. The discrepancy widens on Saturdays and Sundays: Calder’s handle drops to an average of $1.08 million on the days when it directly competes with Gulfstream for attention in the local area and in the national market for simulcast signals.

Nevertheless, Calder officials said that they remain committed to running three days a week throughout 2013 and the first six months of 2014, even if Gulfstream sticks to its plan to run five days per week beginning in December. Gulfstream typically conducts racing five days a week from at least January until April as part of its traditional dates.

“Calder will be running its live days as scheduled through June 30, 2014,” the last date of the fiscal year under Florida racing statutes, said John Marshall, the track’s general manager.

What’s Calder holding on to? For one, casino licenses are tied to racing licenses in Florida, so if Calder closes up shop, it will at the very least complicate Churchill’s ability to continue to operate the casino at the track, as well as jeopardize any plans to expand the casino if enabling legislation is passed. The casino has generated $41 million in revenue through the first six months of this year, according to Churchill’s financial statements, leading the way among Churchill’s four casino properties.

It’s not clear from the financial statements if Churchill is losing money on Calder’s racing operations, though revenue is down 22 percent for the first six months of 2014, from $24.7 million last year to $19.3 million this year. Since Calder had few racing dates during the first six months of the year, the decline mostly reflects the loss in revenue from the resale of simulcast signals.

Calder is also likely holding steady because it will almost certainly gain an advantage at the bargaining table at the beginning of December, when Gulfstream may need help from Calder to fill five days’ worth of races and provide stalls for trainers Gulfstream will likely displace to make room for snow-birding trainers from northern circuits, the Pletchers, Motts, Makers, and Romans of the racing world.

Stirling said Gulfstream has “made it very clear that if you’re here now, you may not be here in the winter.”

Even though Gulfstream’s average handle of $2.57 million during July and August is nowhere near the $8.54 million figure for its nationally prominent December-April meet, Timothy Ritvo, the ex-trainer who is general manager of Gulfstream, said the track was “very close” when asked if the summer months were generating positive cash flow. Ritvo also acknowledged that the track has not met its internal projections for handle, and that the track is currently subsidizing purses at $60,000 a day.

Unlike Calder, which is owned by a publicly traded company, Gulfstream is owned by the Stronach Group, a private company formed by owner-breeder Frank Stronach to hold the debt-free gambling assets of the former MI Developments Inc. The assets were deeded to MI Developments after another publicly traded company, Magna Entertainment Corp., was dissolved in bankruptcy.

Stronach, who is in his early 80s, recently sold stock in another company he founded for approximately $1 billion. He is currently running for a seat in his native Austria’s Parliament. The election is Sept. 29.

Ritvo said that Gulfstream has succeeded in one sense. Citing the figures that show that horsemen in South Florida are receiving 25 percent more in purse distributions this year compared to Calder-only races last year, and that combined handle from the two tracks is up 17 percent over last year’s Calder-only numbers, Ritvo said that Gulfstream has “grown the market.”

“Together, we’re expanding the industry,” Ritvo said. “That was one of our goals.”

The average field size at the two tracks has been 7.20 horses per race, down from 7.43 horses at Calder last year during July and August, according to data. Racetracks strive to maintain an average field size of at least eight horses per race, a figure that is getting more difficult to meet because of rapid declines in the foal crop over the past five years.

Ritvo also said that Gulfstream will likely ask the state racing commission to approve a request to add Monday racing to the track’s schedule in the next several weeks. The track also may request to add more dates as it approaches the five-day expansion in December, Ritvo said.

In the meantime, Calder and Gulfstream continue to talk, even if they are not close to reaching an agreement.

“We honestly believe [head-to-head racing is] beneficial to everybody down here,” Ritvo said. “We’re not trying to bust anyone up or conquer all the racing days. But we think racing companies should be allowed to race. And if someone else isn’t interested in racing, then you should let the racing guys race.”

“There is some good in all of this,” said Stirling, noting that horsemen are running for more money per week with a few more racing opportunities, even if some like-conditioned races are overlapping. “We’d like to see that everything is settled and we knew exactly where we’re going, but it could be worse.”


The Battle of Miami



Days              Avg.Handle            Avg.Purses

24                     $1.27M                 $216,000


Days              Avg. Handle             Avg. Purses

18                     $2.57M                  $256,000



Days              Avg. Handle

16                      $1.08M


16                      $2.52M