05/16/2005 11:00PM

Magna gets license for Detroit

Email

DETROIT - It took 2 1/2 years, three racing commissioners, and multiple rounds of lobbying, but to absolutely no one's surprise, Magna Entertainment Corp. got its racetrack in suburban Detroit on Tuesday.

Acting racing commissioner Christine White granted the lone license available for racing in the suburban area to the largest owner and operator of racetracks in North America. Frank Stronach, Magna's chairman and CEO, said he will build a world-class racetrack and entertainment complex on a 212-acre parcel near Detroit Metropolitan Airport.

The track, to be named Michigan Downs, is scheduled to open in suburban Romulus in 2009, but racing could begin as much as a year sooner than that.

"We hope earlier," said Stronach. "I want to race there as soon as I can."

Magna's original plan for the site called for a $350 million complex including a 2,500-person theater and a 170,000-square-foot entertainment complex. The company is expected to scale back those plans somewhat.

A one-mile turf track will be surrounded by a 1 1/8-mile dirt track for Thoroughbred racing. A seven-eighths-mile harness track could be added later. Plans for a new Native American casino on land next to the track are in the works, and still face challenges. The casino would be operated by the Sault Ste. Marie tribe of Chippewa Indians.

White made the announcement at a morning news conference in downtown Detroit.

"After carefully and objectively weighing each application, the most comprehensive plan to build this track is MEC," she said.

White said she chose Magna over three other applicants because the company:

* Purchased the property on which to build

* Demonstrated public support with a nonbinding plebiscite in December 2003

* Has a proven track record in operating racetracks

* Has the financial wherewithal to proceed

* Has local political approval and a building permit

* Will offer no harmful competition as defined by Michigan racing law

Wayne County Executive Robert Ficano said the complex would create about 1,000 jobs directly and another 1,500 jobs indirectly.

Stronach was elated with the decision that he has sought for so many months.

"We've hit the trifecta here," he said. "It's a win for Magna Entertainment, a win for Michigan horse racing, and a win for the people of Romulus and Wayne County."

Stronach brushed off suggestions that committing Magna to such a project in spite of the company's continuing economic problems might be stretching it too far. Over the past three years, Magna has lost $214 million. It last turned a profit in 2001.

"The basics are sound and we will be on solid ground in the near future," Stronach said.

Not on solid ground is the status of Great Lakes Downs, the home of Michigan Thoroughbred racing since the Detroit Race Course closed in 1998. Magna owns the bullring track near Muskegon in the southwest part of the state, but leases the license to another group because state racing law prohibits any organization from having more than one license. Stronach would not comment on the fate of that track, saying only, "We kept Great Lakes Downs alive so that racing would not disappear in this state."

Bob Miller, president of the Michigan HBPA, said that bringing racing to the Detroit area was the only way for the sport to survive in the state.

"We've lost about $15 million in purses in the last four or five years," he said. "Foal registrations are down."

Asked if he thought Magna could make a profit in the Detroit area, Miller shook his head. "I couldn't," he said.

Miller said that Magna would need to draw more young people into racing and that, in the interim, the state's horsemen would try to hold on at Great Lakes Downs.

"I hope we can make it," he said. "We've survived so far, so we will try to hang in there."