Frank Stronach believes Santa Anita Park has the potential to be the greatest racetrack in the country all it needs is better family entertainment.
Not coincidentally, the billionaire industrialist’s company is in the process of buying the Arcadia racetrack and surrounding acreage from Meditrust Cos. And once the $126 million acquisition closes later this month, Stronach plans to develop a theme park and pedestrian-oriented shopping area adjacent to the track.
“Racing has to provide better entertainment, not only to the hard-core gamblers,” said Stronach, who is chairman of the Ontario, Canada-based Magna International, one of the world’s largest auto systems manufacturers.
The concept of coupling a racetrack with a retail-entertainment component is being contemplated by many track owners around the country, as a means of boosting returns though it remains unproven.
“That doesn’t mean it’s a bad idea,” said Eugene Christiansen, principal with leisure-industry consultancy Christiansen Cummings Associates in New York. “If it’s well executed, it would bring many more people to the property different kinds of people.”
He pointed to the location-based entertainment that Las Vegas casinos have introduced in recent years.
Stronach said he plans to add a museum and theme park with horse-themed rides and interactive games. (In his native Austria, Magna is already pursuing plans to build a $787 million theme park.)
Stronach also plans to make significant modifications to Meditrust’s proposed 500,000-square-foot retail center and multiplex theater targeted for part of the track’s 100-acre parking lot.
“I would assume they’d prefer more of a village-type” development, Stronach said, adding that he plans to talk to Arcadia city officials and community leaders to “come up with something (they) would endorse.”
David Carter, a sports marketing consultant and USC business professor, said it’s important for owners of sports facilities to devise ways of bringing in more foot traffic. “On a stand-alone basis, sports projects don’t make immediate financial sense,” Carter said.
Like other tracks around the country, Santa Anita has seen its on-track attendance steadily slip for years, a victim of changing demographics and competition from other entertainment alternatives. To reverse that decline, Santa Anita launched a new marketing campaign, resulting in an increase in on-track attendance of about 1 percent for the winter-spring period early this year.
Stronach, 66, has long coveted Santa Anita, which opened in 1934. He owns about 800 thoroughbreds, with 150 in training. His colt Awesome Again was this year’s Breeders’ Cup champion. While most of his horses are boarded at farms he owns in Kentucky and Florida, he expects to ship some out to Arcadia soon.
Meditrust bought Santa Anita last year for $458 million, but that price included the neighboring Santa Anita Fashion Park mall and a medical office building in Arcadia, neither of which Stronach is buying. For just the assets Stronach is picking up, Meditrust paid $175 million.
Meditrust, a Needham, Mass.-based health care real estate investment trust, bought the track mainly for tax advantages, which since have been diminished by a new federal law. The company also has heavy debts and recently announced a financial restructuring. In short, it needs the cash.
