09/07/2017 12:16PM

Keeneland September sale tweaks format, adds incentives

Keeneland Photo
The Keeneland September yearling sale begins its run on Sept. 11.

The Keeneland September yearling sale is the long-established industry standard among North American yearling auctions, but it did not earn that status by being resistant to change.

It is rare for the bellwether auction to go from year to year without a few tweaks to the proceedings, but this year’s edition brings with it several changes that will make for a much different sale than 2016.

Some of the changes will be immediately apparent. Books 1 and 2 have shifted drastically, with Book 1 consisting of a condensed, super-select session, while Book 2 will span three high-volume days. Keeneland also adjusted its commission structure, which will come in play after the fall of the hammer.

Other tweaks will be felt in the long term. The auction company introduced a pair of incentive programs for graded or group stakes-winning graduates that will pay off a year or more down the road.

“The September sale is the barometer of the Thoroughbred industry, and it is the major yearling sale anywhere in the world,” said Geoffrey Russell, Keeneland’s director of sales. “We’re looking forward to it very much.”

The marathon Keeneland September sale will span 12 sessions, from Sept. 11-23, with the traditional dark day falling Friday, Sept. 15. The opening-day Book 1 will begin at 3 p.m. Eastern, the three days that comprise Book 2 will start at 11 a.m., and all other sessions will commence at 10 a.m.

The auction features one fewer session in 2017, and the 4,139 horses in the catalog constitute an 8 percent smaller pool of offerings from the 4,479 last year.

Book 1 has been cut to an ultra-exclusive single session of 167 offerings, after crossing three days and 607 offerings in 2016. The second book will follow over the next three sessions, putting about 345 yearlings through the ring each day.

:: More Keeneland September coverage: Hips to watch | Video preview ::

“We’re trying to get as many horses in front of the buyers before there’s any break, and we’ve pretty much doubled our numbers,” Russell said. “With the new layout, buyers will be able to look at 1,200 horses, and they’re probably able to look at the Book 3 horses, so that’s another 800 horses. If they have to leave [after the first week], they’ll at least have the opportunity to look at 2,000 horses before they do, and I think that’s a positive thing for anybody.”

Keeneland will further incentivize buyers and sellers with a pair of bonus programs.

The first to be introduced was the Book 1 Bonus, in which the seller and current owner of a horse sold in the auction’s first book receives a share in a $750,000 bonus pool if that horse wins a qualified Grade or Group 1 race at ages 2 or 3. Winners of a Grade 1 at Keeneland, or the Grade 2 Blue Grass Stakes, receive a double share.

In August, Keeneland expanded the program with the Seller Bonus, which pays out to the sellers of graded stakes winners at 2 or 3 from any book in the catalog, on a sliding scale by grade level, up to $10,000.

“It certainly won’t hurt, and I think it’s an overall help psychologically at the very least to buyers,” said Kip Elser of Kirkwood Stables. “It’s nice to know the sales company is rooting for you when you leave there and helping you along the way. That’s a positive. I don’t really think it’s going to affect our buying strategy, but overall it’s a very good thing.”

Returns from sales earlier in the calendar have revealed the top of the market to be as vibrant as ever, and it appears to be having some trickle-down effect into the middle markets.

Last year’s Keeneland September sale produced solid comparable figures that held steady later into the auction than many expected, after earlier sales on the calendar struggled to keep their middle markets going.

Cumulative returns ultimately took a small dip following a bleak run in the final sessions, but the auction’s ability to keep pace into the mid-to-late books provided a sense of optimism that was bolstered by a strong 2-year-old auction season earlier this year and record performances in the early major yearling sales.

“I think there’s an appearance of a stronger middle market than we’ve had in recent years, from what we’ve seen at the [Fasig-Tipton] July sale and the New York sales,” said consignor Stuart Morris. “I think the middle market’s going to be better and the really expensive horses are going to be good no matter where you are. I think it might be a little stronger in Book 5 than it has been in previous years, and Book 6 is going to be Book 6.

“I’m anticipating a good response and a good buyer base,” he continued. “The economy’s in good shape now, and as long as things stay strong in that regard, we should be okay.”

Last year’s September sale finished with 2,792 horses sold over 13 sessions for revenues of $272,890,500, down 3 percent from last year’s 12-day sale when 2,745 yearlings brought a combined $281,496,100.

The average sale price declined 5 percent to $97,740, the median dipped 20 percent to $40,000, and the buyback rate finished at 26 percent compared with 24 percent in 2015.

M.V. Magnier of the Coolmore partnership bought the sale-topper, a Scat Daddy colt out of 2016 Broodmare of the Year Leslie’s Lady, for $3 million. It was the highest price commanded by a Keeneland September offering since 2010.

The half-brother to champion Beholder and Grade 1 winner Into Mischief was later named Mendelssohn and exported to Ireland, where he won his maiden in his second start Aug. 13.

Other graduates of note from last year’s September sale include Grade 2 winner Copper Bullet, Grade 3 winner Dream It Is, and stakes winners Dak Attack, Buy Sell Hold, Rose to Fame, Sunny Skies, and March X Press.

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