British See Strong Future in U.S. Race Tracks With OTB
Oct. 01, 1989
PHILADELPHIA (AP) _ You can expect to hear more British accents among the new breed of race track owners in the country.
Bookmakers schooled in Britain's gaming industry that allows bettors to put money on anything from the sex of a royal baby to whether Elvis will return in a spaceship are looking to the United States to strike out on their own or expand their vast holdings.
Many of these entrepreneurs see this country as a growing gambling market despite the threats of high land costs and competition from state lotteries, illegal sports betting and casinos.
The lure of off-track betting in Pennsylvania and other states has attracted the new race track buyers. For them, off-track betting holds the promise of bringing gambling, specifically thoroughbred and harness racing, to a broader range of people by bringing it closer to their homes and offices in a fashionable entertainment setting.
At least five of the 10 major race track deals this year were fueled by the buyer's desire to exploit off-track betting opportunities or simulcasting, which allows tracks to take bets on races at other tracks.
''European companies think America represents a tremendous OTB opportunity,'' said Maury Wolff, a pari-mutuel industry consultant with Racing Resource Group of Alexandria, Va. ''You have a history of European success in OTB enterprises and I think the people who run these enterprises look at the U.S. and see it as an untapped market for off-track betting.''
Bob Green and Bill Hogwood, two former officers in the London-based Hill- Mecca gambling giant, left their jobs to form Greenwood Racing Inc., which bought Philadelphia Park months after off-track betting was approved in Pennsylvania. They paid $63 million for the track, nearly double what its previous owners paid five years ago.
The state's Horse Racing Commission has yet to approve the deal.
Ladbroke Racing Corp., the U.S. subsidiary of British gambling giant Ladbroke Group PLC, bought the Meadows, a harness track near Pittsburgh, and Golden Gate Fields near San Francisco, where California law allows horse players to bet at county fairgrounds.
Ladbroke got its start in this country five years ago with the purchase of Detroit Race Course. The Michigan Legislature has yet to fulfill Ladbrokes' hopes the lawmakers would approve off-track betting.
''We see OTB as an opportunity to provide the racing experience to a wider range of people. ... It's one way to distribute to a wider audience and make it more attractive,'' said David Goodwill, president and chief operating officer of Ladbroke Racing.
Another company, Oregon Racing, headed by another British gaming executive, is in the process of buying Portland Meadows' operating agreement to take advantage of simulcasting.
Key to the pending sale of Canterbury Downs near Minneapolis are plans to begin a simulcast agreement with Santa Anita race track in California after the first of the year.
Although the debate is just beginning in this country on legalized sports betting, Wolff and others feel race tracks with off-track betting facilities would be in the best position to take sports wagers.
Eugene Christiansen of the New York gaming consulting firm Christiansen Cummings Inc. said off-track betting parlors would be the obvious place to allow sports betting.
''Putting sports betting into the hands of mom and pop operations would expose them to some not-too-friendly competitors,'' Christiansen said, referring to the bookies that dominate illegal gambling.
In Pennsylvania the law allows the state's five tracks to open five to six OTB parlors each.
Pennsylvania's horse-racing industry lobbied hard for legislation allowing off-track betting. Track owners warned their betting windows had to be easily accessible to more people.
Gov. Robert P. Casey, who had said he was opposed to any state-sanctioned increase in gambling, vetoed the bill before the General Assembly overrode him in 1988.
For the former owners of Philadelphia Park, who got what most observers feel was a generous price, off-track betting was the saviour they had hoped.
Track owners across the state undertook a last-minute campaign to reverse the veto, convincing legislators that if OTB weren't approved, their huge tracts of land would generate more money as shopping malls, apartment complexes or industrial parks.
Bob Brennan, head of International Thoroughbred Breeders Inc., the former owners of Philadelphia Park, had said the the track would close its gates in February of this year if OTB were not approved.
Pennsylvania's new law allows the OTB sites within a 30-mile radius of each of the state's five tracks. The legislation calls for them to be well-kept bars or restaurants featuring pari-mutuel betting on horse races.
''Think of the OTB parlors in New York and forget them,'' Bob Green, president of Greenwood Racing Corp., the company that bought Philadelphia Park, said of the largely utilitarian betting shops. ''We plan a clearly first-class facility.''