At Laurel, New Life, New Facility and Renewed Hope

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New barns at Laurel | Jim McCue

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LAUREL, MD– One of the first things Sal Sinatra noticed when he took over as the general manager of Laurel was the price of a slice of pizza. It was a hefty $5.50. That’s no way to treat a customer.

“You can go buy a whole pie at Papa John’s for $5 and we’re charging $5.50 for a slice?” said Sinatra, who left Parx to work for the Maryland Jockey Club in December, 2014. “You can’t charge someone $5.50 for a slice of pizza. We brought the prices down. Food and beverage should be break even; it’s an amenity. You should come to track and enjoy the day. We don’t want people to feel like they’re getting ripped off.”

Reducing the price for a slice of pizza from $5.50 to $4.25 may seem like a small thing. But it’s not when you consider the bigger picture, what they’re trying to do at Laurel, which is to do everything the right way.

Where others might have seen a dilapidated racetrack that was a lost cause, a new management team saw an opportunity. Treat the customer right, which means not selling overpriced, bad food, turn the building into a spectacular facility and work to fix the insanely overcrowded racing schedule in the Mid-Atlantic states and what would be the end result? The belief among the management team at Laurel is that it will be a renaissance of Maryland racing.

“Horse racing isn’t dead,” Sinatra said. “We just have to do a better job.”

Laurel was not originally a focus of the Stronach Group, which owns the two Maryland Jockey Club tracks, Pimlico and Laurel. When you operate two of the premier racetracks in the country in Santa Anita and Gulfstream, it’s easy for a place like Laurel to get overlooked. The plant was old and tired, the racing product went downhill when so many neighboring states fattened their purses with slot money and a typical weekday crowd numbered in the hundreds. This was the kind of racetrack that was easy to give up on.

But Sinatra, Stronach Group COO Tim Ritvo and others among the Stronach team had other ideas. Sometimes for better, sometimes for worse, Frank Stronach is willing to do the unconventional when it comes to racing and his racetracks. Laurel, a track most owners would have let rot away, would no longer be neglected. Rather, the company’s focus would be to create a new Laurel that could join Gulfstream and Santa Anita as the prize properties in the Stronach racetrack portfolio.

“We want to make Laurel Frank’s third jewel,” Sinatra said. “The entire Stronach corporation is now zeroed in on Maryland.”

That idea started to take root when Sinatra arrived and was joined by Ritvo, who had been spending most of his time at Gulfstream before landing in Maryland. As outsiders, they saw something that the locals had perhaps forgotten, that Maryland is a horse-crazy state with a rich racing tradition. With some changes, albeit major ones, they saw no reason why Laurel couldn’t once again be one of the premier racetracks in the country.

The first step would be to take the Laurel facility and, basically, start all over again, creating something reminiscent of what the Stronach Group has done with Gulfstream in Florida. It would be expensive but Maryland racing had some advantages.

When slots were legalized in the state, Laurel and Pimlico were shut out as places that could have casinos, which seemed at the time to be a severe blow to Maryland racing. Instead, in 2008, when voters approved a ballot initiative that legalized casinos in the state, the new law required that 7 percent of the slot machine revenue from the casinos go to the horse racing industry, both toward purses and toward capital improvements. When casinos opened in 2010, a large chunk of money started flowing in, and Maryland’s bigger purses immediately improved the racing product.

In addition, a substantial amount of money became available for improvements to Pimlico and Laurel. Sinatra explains that for every dollar the Maryland Jockey Club spends on improvements it receives a dollar in return from the state.

“We started with simple things, like buying flat screen tvs, putting down carpeting and painting,” Sinatra said. “These were just little things, but people were so appreciative. It helped bring the fan base back. People went home and told their buddies who hadn’t been here in 20 years that they had to come out to Laurel and see all the great things they were doing.”

They also built several new barns and refurbished others.

The televisions and the fresh coats of paint were just a start. When everything is completed, which should be by some time next year, Laurel will be a facility that rivals any in the sport.

Most of the work so far has been completed on the first floor. Once dreary areas have had a complete makeover. There are sports bars, a brightly lit clean food court, a restaurant. A bowling alley is being built. The employees have bought in as its hard to find one that isn’t smiling and always courteous to the fan.

Sinatra said the final costs of renovating the first floor will be $20 million.

The second floor, a traditional grandstand area with thousands of seats, most of them empty on virtually every racing day, is the next major project. It, too, will be totally redone, with suites, open air seating, a refurbished box section, a high rollers room complete with marble pillars and floors that are a Stronach speciality. The second floor work will cost about $10 million.

People trying to get to the new Laurel should find it easy to do so. In a fortuitous development that more or less fell into Laurel’s lap, the Maryland Transit Administration has decided to rebuild a train stop directly outside the entrance to the track and build a parking garage there. The stop is part of a train line that runs from Baltimore to Washington and the new Laurel will be connected to the train station so that fans can go from one to the other without having to step outside.

A new paddock will be built directly in front of the train station and horses will walk through a tunnel from there to the track. It will be similar to the set up at Gulfstream. And those who get off the train or look out their windows at the track won’t see the same rundown facade. The outside of the building will also be rebuilt and will morph into a building with a stylish colonial look.

“Even people who don’t come to the track on the train, will look out window and be right on top of the paddock,” Sinatra said. “We think they’re going to say, ‘Hey, there are horses there, that place looks really nice.’”

The MJC owns the land on the other side of the train stop and there it will build retail shops, restaurants and condominiums, much in the Gulfstream mode. The shopping and dining areas may not be as close to the grandstand as they are at Gulfstream but they will be close enough. On a nice summer day, you will definitely be able to enjoy the races and a daiquiri at a trendy bar and restaurant a stone’s throw from the track.

“With the condos and the retail, that’s Frank’s theory, to combine shopping, dining, homes and racing,” Sinatra said. “Gulfstream is more outdoor entertainment. This being the Mid-Atlantic, we’re going to be more indoor oriented, but it’s going to be a fabulous place when we’re done.”

Though the Laurel renovations are only in there first few stages, they’re already paying off. Sinatra estimates that a typical Saturday crowd is now about 4,500, where it was about 1,500 just three years ago. At the Laurel meet which ended Sunday, on-track handle was up 34.5 percent and all-sources handle increased by 9 percent.

The Maryland Jockey Club is taking the money it is getting from the slots revenue and putting it to work to grow its business. It’s something few other tracks that have slots revenue have done. Usually, the formula is to take all the money and do nothing to market and improve racing. That leads to poor racing, low handles and anemic attendances. Sinatra says that’s not a wise thing to do politically.

“Is it worth giving away $250,000 a day for no handle?” he said. “All you’re doing is opening yourself up to criticism from politicians who want to take that money away from you. That just speeds it up. Our thought is if you get a subsidy, you’ve got to grow. I can go back and argue, `you give me x million in purses but I’ve increased handle, helped ancillary businesses, breeding is up, created tax dollars, you are getting a return on your investment.’”

The Laurel mantra also includes doing more to ensure the integrity of the racing as management has become more aggressive than it has in the past when it comes to asking suspect trainers to leave. Last year, the MJC banished trainers Hector Garcia and Juan Vasquez and, this year, briefly stopped accepting entries from Marcus Vitali. Ritvo is also on record saying he wants to lower the takeout.

The final part of the equation is to substantially improve the racing, and one step was taken when it was announced that the D.C. International would return to Laurel in 2017. Laurel is also pitching to host a Breeders’ Cup.

But there is a bigger, more ambitious picture. Stronach’s main plans may be difficult to pull off but could reshape the way racing is conducted in the Northeast. Just as Stronach took over racing at Calder and renamed it Gulfstream Park West in order to solidify racing in South Florida, he wants to do the same in the states surrounding Laurel.

“I am dreading that we’re heading into the summertime with four places running (Laurel, Parx, Delaware Park and Monmouth), basically writing the same condition book, looking for the same horses that don’t exist because of the shrinking foal crop,” Sinatra said. “It’s really ludicrous. And nobody wants to bend. Everyone wants to run in the summertime and it doesn’t work. We all put out a poor product, with too many six-horse fields and too many 3-5 shots. Nobody wants to bet those races and then we wonder why no one wants to come to the races anymore.”

Sinatra would like to see the four tracks come together and work out a schedule where no more than two at a time are racing, but he understands that the type of cooperation needed for that to happen simply doesn’t exist in the dysfunctional sport of horses racing. So the Stronach Group will go about their plan by, instead, trying to take over the racing operations at the aforementioned tracks, just as it did at Calder. Sinatra was non-committal when asked about Stronach management taking over the operation at Parx. However, according to two sources with inside knowledge of the talks between Parx and the Maryland Jockey Club officials, the agreement to allow Stronach’s team to run racing at Parx is all but a done deal.

If the Stronach Group has control of both Parx and Pimlico/Laurel it could put Delaware and Monmouth into a position where those tracks might be forced to deal with Stronach or risk getting squashed by a powerful foe with better racing. The MJC team tried to take over Delaware last year but could not reach an agreement with management there.

“The ultimate goal is to take over the Mid-Atlantic and structure it properly,” Sinatra said. “It definitely needs to be two tracks at a time, no more. Maybe one racing secretary, maybe two. This person or persons could write condition books that work to the benefit of everyone. We’d have free vanning between tracks. You’re going to need one group saying here’s what’s best for racing. It’s going to happen.”

For horse racing, it all seems like some sort of fantasy. A great facility that can draw new fans as the flagship track of a four-track circuit with huge fields and great racing. Lower takeouts. No one will look the other way when trainers are too good to be true. Inexpensive, tasty pizza. A revitalization of the sport in a key area of the country. Is it too good to be true or can it actually happen? The Stronach Group is going to do whatever it can to bring its plans to reality.

Is The Preakness Headed to Laurel?

By Bill Finley

With upwards of $30 million in improvements planned for the facility, Laurel is in the process of being turned into one of the nicest, most luxurious racetracks in the country. Its sister track, Pimlico, meanwhile, is so run down that it makes little sense to pour the type of money into it that would be needed for it to become a worthy home of a Triple Crown race.

So does it make any sense to continue to run the Preakness at Pimlico and not move it to Laurel? With the lone exception of tradition (the race has been run every year at Pimlico and in Baltimore since 1909), there are few compelling reasons to not move the race to a new Laurel. Will it happen? It’s a question management with the Maryland Jockey Club is giving careful consideration to.

While not ready to confirm that the Preakness will eventually be moved to Laurel, Maryland Jockey Club General Manager Sal Sinatra laid out a case for doing just that.

“The question is whether or not it is worth rebuilding or retrofitting Pimlico?” he said. “Obviously, the Preakness provides a big economic impact to the City of Baltimore and we are aware of that. But we can’t build super suites at Pimlico. We can’t do there what Churchill Downs did. And we can do that at Laurel. We are putting a lot of money into Laurel to make it a premier racetrack and we cannot do that at two places.

“The Pimlico building is crumbling and all we’ve been doing the last many years is kicking the can down the road. On Preakness Day, we’ve had problems with the toilets and with the electricity. It really needs substantial work, which would be a substantial investment.”

It appears that Pimlico’s future is in the hands of the Maryland Stadium Authority. The MSA was established in 1986 and its mission was to build, manage and maintain the Orioles baseball stadium and to bring an NFL team back to Baltimore. In March, state officials asked the Maryland Stadium Authority to undertake a study to determine what it would cost to modernize the 146-year-old track.

It’s likely that the MSA will conclude that the costs of modernizing Pimlico will be exorbitant. If so, who will pay for it? Having sunk so much into Laurel and determined to make it the centerpiece of Maryland racing, the Stronach Group has little incentive to put any money into Pimlico. That would mean that the Stadium Authority, through taxpayer dollars, might have to foot the bill. Several major cities have built stadiums for NFL and MLB teams because officials felt the economic benefits of having major league teams offset the costs of the stadiums. The Stadium Authority would have to conclude that paying to rebuild Pimlico would be worth it because of the economic impact the Preakness has on the City of Baltimore.

“The question is whether or not they want to invest millions and millions into Pimlico or do something else with the land,” Sinatra said. “It’s like a chess game. They could say it’s a lost cause or they could invest the money to save it. We’ll live by their decision. We’re glad everyone is putting their heads together to try to fix this problem.”

 

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