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Catching up with Ocala Stud's J. Michael O'Farrell
J. Michael O’Farrell Jr. moved to Ocala, Fla., from Maryland in 1956 at age 8. That year, Needles became the first Florida-bred to win the Kentucky Derby, and it was when O’Farrell’s father, Joseph, became part of the budding breeding program in Florida.
Michael O’Farrell has been around horses ever since, breeding them, raising them, training them, and selling them at the 2-year-old auctions in Ocala that his father helped establish.
Joe O’Farrell, one of the pioneers of the Florida breeding industry, bought a farm and training center with business partners more than a half-century ago, named it Ocala Stud, and in subsequent years introduced a new approach to developing and selling young Thoroughbreds.
Michael O’Farrell took over the management duties of Ocala Stud in 1971 after his father bought out the partners. He has led the operation, which he owns with his sisters and brothers-in-law, through the highs and lows of the bloodstock market and several periods of transition, including after his father died in 1982 and a devastating fire in 2001 that killed 22 horses.
Now 65, and with his sons, Joe III and David, both working in key positions at Ocala Stud, O’Farrell is cautiously optimistic about the future of the bloodstock business, especially as it pertains to the 2-year-olds-in-training market. He’s fully aware of the difficulties of running a successful horse farm and what it takes to survive.
“All businesses are difficult, I’m sure, but I’ve been fortunate enough to meet businesspeople who will tell you that the horse business is a little different and a little tougher,” O’Farrell said. “So much of our business is gambling, and you have to be fortunate, you have to have a little bit of luck, you have to have knowledge, and at the end of the day, you have to love this business to be in it.
“I don’t think that there’s any question that if you’re working in the horse business to make money, or [the goal] is all based on money, I think you’re in the wrong business. You have to love the game, and, of course, I was raised in it. I loved the game at an early age, and I love the game at a late age.”
Last year, a report in the Harvard Business Review indicated that approximately 70 percent of all family-owned businesses are sold before the second generation can take over, and only 10 percent make it to the third generation. O’Farrell learned the horse industry from his father and took those lessons to heart when he assumed leadership of Ocala Stud. All of O’Farrell’s knowledge and experience have been useful in planning yet another generational shift at the historic property, which became a possibility after David, now the farm manager, and Joe, the farm’s financial manager, returned to work at Ocala Stud in the mid-2000s.
“My sons were not involved at an early age, as I was, but when they did come back [after college], I started them right at the bottom, both of them, and they had to learn from Day 1 that you had to work hard,” Michael O’Farrell said. “I wanted them to be in the position that there wasn’t anything on the farm that they wouldn’t or couldn’t do. Now they’ve got the respect of the other employees that have been with us over a number of years, and they’re now getting the respect of some of the other breeders and those in the industry here locally. They plan on being in the business, I’m sure, well after I’m gone, but how that will play out, it’s really hard to say.”
Ocala Stud was at the forefront of creating the 2-year-old auction market in the 1950s and 1960s, when Joe O’Farrell and others in the burgeoning Ocala horse community devised a new way to market young Thoroughbreds by emphasizing training and physical ability rather than pedigree. Michael O’Farrell remembers how long it took for the concept of training 2-year-olds for auction to catch on. He also believes that the juvenile market in recent years has weathered tough economic times better than the yearling market due precisely to its focus on showcasing potential racing talent.
“Over the last two or three years, it’s been extremely difficult for breeders if they’re in the commercial side of the business, for them to make ends meet,” he said. “Pedigree is not quite as important in today’s world because nobody’s buying breeding stock for a lot of money. The residual breeding-stock value [of a potential stallion or broodmare] is not as important in today’s world as it used to be. So, where’s the value?
“The value is buying a horse that can really run, and value is what they are going to make on the racetrack in today’s world. You can [find] that at a 2-year-old sale – you don’t have to have the royal bloodline to do well. You can find a horse with an ordinary pedigree and make money if it turns out to be the quality of horse that you think you’re buying.
“Every one of our 2-year-old sales [in Ocala] last year and this year have been up significantly, and what’s the reason for that? No. 1: A lot of runners have come out of our sales ... More and more of the top stables are buying horses at 2-year-old sales. Our [Ocala spring sale of 2-year-olds in training] was as good of a sale as I’ve been to in the past eight or 10 years because we had a huge demand, lots of buyers, and a lot of nice horses for sale.”
The horse business nationwide is still recovering from the 2008 economic recession. Florida’s foal crop in 2012 was slightly less than half of its 2007 crop, which was 4,377. The battle over race dates between Gulfstream and Calder has continued through late June, and as this issue went to press, both tracks were still scheduled to conduct live racing head-to-head beginning in July.
O’Farrell believes the racing problems in Florida are threatening the state’s Thoroughbred industry as a whole, and that the disputes between tracks in Miami (Calder) and Hallandale Beach (Gulfstream Park) are representative of larger concerns over the way modern racetracks are run.
“Unfortunately, our racing in Florida is not doing as well as we would have hoped,” O’Farrell said. “Part of it is the economy, but part of it is because of track ownership. Like it or not, Churchill Downs [Inc., which owns Calder] has not done a particularly good job with Calder ... their [emphasis] is with casino gaming, and racing is taking a backseat. Their profit margins are greater on the other side of the business. The truth is, the horsemen’s organizations have allowed racetracks to dictate how things go. We all accepted and were happy more or less when racetracks were able to expand to other forms of gaming, and we got a percentage of that. The problem now is that horse racing is taking a backseat.
“When I was a kid, I’d go to Hialeah with my father, which was, along with Saratoga, Del Mar, Keeneland, and even Arlington, one of the top race meets in the country. The way those racetracks were operated, a lot of them, it was [based on] pride of ownership. Eugene Mori, the owner of Hialeah, he had pride of ownership. Racetracks at that time were operated like restaurants. A first-class restaurant has a first-class owner that knows everybody when they come through the door, and makes them feel welcome, and remembers them when they were there [before], and knows their name, and pats them on the back, and every now and then gives them a free drink.
“That’s the way racetracks were operated back in the 1950s and 1960s. Well, you go to racetracks today, and that’s not how they are operated. Unfortunately, it’s just a sign of the times. Until the problems are settled in south Florida, we’re going to have problems up here in Ocala. It’s a difficult environment.”
In the 1960s, Ocala Stud stood one of the state’s foundation sires in Rough’n Tumble, the sire of the legendary Dr. Fager. The farm’s stallion roster through the years has included such luminaries as Explodent, Saint Ballado, Notebook, and the recently deceased Montbrook, to name but a few. Now, O’Farrell is overseeing a younger group of stallions packed with potential, led by High Cotton.
The business model at Ocala Stud has remained largely the same since his father started it in 1956, and despite the ups and downs, Michael O’Farrell remains committed to what is essentially a labor of love.
“We’re giving our horses support ourselves, and fortunately, the other breeders are helping a lot, and so we’re excited,” he said. “Probably five of the horses we have bred to over 600 mares this year, and in an environment like we have today, that’s doing extremely well.
“That’s the thing: With 2-year-old consignors, they have a produce record just like a stallion or a broodmare, so the ones that are fortunate enough to have nice horses and sell nice horses, they can continue to do well. I mean, you always have to come with a runner. It’s no different than anything else.”
J. Michael O’Farrell Jr.
Born: July 29, 1947
Family: Wife Judith, sons Joseph III and David
Property: Ocala Stud, established 1956. Three farms totaling approximately 500 acres in Ocala/Marion Co. area. Includes a five-furlong training track.
Career highlights and accomplishments: Moved to Florida from his native Maryland in 1956 when his father, Joseph O’Farrell, and partners bought the former Dickey Stables in Ocala; assumed management of Ocala Stud in 1971 when family bought out partners; former board member of the Florida Thoroughbred Breeders’ and Owners’ Association; serves as a director of Ocala Breeders’ Sales Co.; member Marion Co. Agricultural Hall of Fame
Prominent sires who stood at Ocala Stud include: Rough’n Tumble, Explodent, Saint Ballado, Notebook, Concorde’s Tune, Trippi, Montbrook
Leading runners bred and/or sold by Ocala Stud include: My Dear Girl, Roman Brother, Alley Fighter, Country Queen, On to Royalty, Outofthebox, Shake You Down, Chapel Royal, Bellamy Road, Musical Romance, Gourmet Dinner, Turbulent Descent, Unlimited Budget
Kentucky Derby winners broken and trained at Ocala Stud: Carry Back (1961), Unbridled (1990), Street Sense (2007)