03/04/2012 4:54PM

Jay Bergman: Signs of optimism at Perretti Farms


Building a breeding farm is not a small task. Dismantling one is quite a different story.

Last year when New Jersey's harness existence was in peril, Perretti Farms was in the midst of its own struggle. The Cream Ridge, N.J., nursery, the largest in the state, was dealing with the personal health issues of its founder William J. Perretti, along with the grumbling and rumblings of a governor who threatened to shut down the Meadowlands.

Looking into a crystal ball at that time left little doubt any attempt to continue this large breeding operation would not make sense. The farm announced a two-ply dispersal plan which sent 140 (nearly half) of its broodmares to Harrisburg, Pa., for sale last November.

"Was it a good sale?," questioned Perretti Farms director of marketing Bob Marks. "We sold some well but I think we gave away others rather cheaply."

In the end, Marks believes selling that large an amount of broodmares was a costly proposition, perhaps netting Perretti roughly 50 percent of the true value of horseflesh.

The Standardbred breeding business has been in a state of contraction for the last decade. Even the advent of slot-funded purses in many a locality has only given what Marks calls a "band-aid" effect to operations.

Another problem occurred on the way to the Perretti Farms exit from the business. Attempts to sell or auction off part of the farm met price resistance, leading the sellers to rethink their position and for the most part hold on to the land.

"It's just not a great market to sell property," said Marks.

So in the span of some 12 months market forces have not pushed the Perretti Farms out of business. In fact it has made both William Perretti and his son Anthony rethink their position and attempt to go forward. The farm surprised many in the business recently by actually purchasing some broodmares.

Marks wasn't willing to completely call that a "positive" sign about the farm’s future but he did indicate that recent political activity within the Garden State has suggested a brighter future may be in place.

With the situation for breeders a bit unsettling in Pennsylvania and Ontario with states and provinces looking to claw back purse money, Perretti's station in New Jersey became a little bit more appealing. For Marks, that means that when he goes to sell sons and daughters of leading stallion Rocknroll Hanover at auction later this year he may not see the resistance of the previous year.

"I thought what sold as yearlings last year was the greatest collection of pacing colts we've sold in 25 years. But we did not get paid for those horses," said Marks, believing the New Jersey-bred status was a big negative to potential buyers.

In response to last year's flat sales many market breeders for the first time began to reassess stallion fees. Many fees, including those at Perretti Farms, were lowered to go more in line with market expectations. While that may sooth some players, Marks believes it doesn't answer the basic problems all breeders face.

"From the time the mare is bred until the time the foal sells, it costs roughly $20,000 and that's not including the stud fee," said Marks.

The rise of slot-induced purses has dramatically increased the amounts Standardbreds race for annually, but to Marks and many others the purses are tilted in a way that supports a $10,000 claimer in a much better way than a 2- or 3-year-old maiden.

"The Thoroughbred people understand the game a whole lot better," he remarked after reading the level maidens will race for at the Belmont meet. "They recognize that you must give the yearling buyer a way to recoup on his investment."

The Standardbred industry has for the most part taken the gifts of slot money and weighted it much more heavily on raceway horses and aged performers. In the recently announced purse and stakes structure at Belmont and Saratoga a healthy 25 percent of all purse money is scheduled to be offered in stakes races. Last year at Yonkers, where more than $50 million was allotted to purses, only about $3 million was used in added money towards stakes races.

Regardless of the industry's current climate, Marks is hopeful that a shift in attitude in Trenton towards slot machines at the Meadowlands begins to take shape. A year after Governor Christie committed to giving Atlantic City the tools and five years to turn around the resort community, there's talk that time is running out. With New York's Governor Andrew Cuomo supporting full casino legislation in his state it has become clear that New Jersey may have to act sooner rather than later.

Timing means everything in the breeding business and Perretti Farms has been among the best at finding the top stallions and standing them at its farm. Both Rocknroll Hanover on the pacing side and Muscles Yankee on the trotting side are considered elite. Marks truly believes the next great stallion may in fact be Rock N Roll Heaven, the 2010 Horse of the Year who now stands in New York at Blue Chip Farms.

"We were going to get that horse and then we lost him when everything in New Jersey broke down," he lamented.

Despite not getting the now-second year stallion, Perretti has bred mares to Rock N Roll Heaven.

While the farm breeds to stallions across state lines, it's clear it hasn’t given up on New Jersey.

Not yet.