Santa Anita owner blew it

Here's another case where an unwillingness to change with the times doomed the best of intentions. Frank Stronach, chairman of Magna Entertainment, has such a passion for the sport that he invested millions of dollars to acquire Santa Anita, Gulfstream and other tracks around the country. But WashPost columnist Andrew Beyer says that all his efforts masked a simple economic fact: Holding huge tracts of real estate devoted simply to horse racing - and not even year-round horse racing - was not an especially strong business proposition, particularly when other lucrative revenue streams, such as slot machines, were not effectively pursued. In case you missed it, Magna filed for Chapter 11 bankruptcy protection, which probably means that Santa Anita and other facilities will be put up for sale.

Creditors have no interest in reviving a company that brought on its own demise with a series of disastrous financial moves. It bought Gulfstream Park for $90 million, then demolished it and spent $240 million to build a new facility that most fans regard as inferior to the old one. Because Gulfstream needed stabling for more horses, Stronach decided to build the Taj Mahal of stable areas, Palm Meadows, at a cost in the vicinity of $100 million -- an investment that returns no revenue.

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There are few potential buyers who would want these properties as racetracks. Churchill Downs Inc. is the other major owner of U.S. tracks, but it is now appears more interested in online wagering and slot machines than live racing. Perhaps it would want Gulfstream or Santa Anita because it needs good betting products to offer in the winter months. Technology entrepreneur Halsey Minor has displayed some interest in the racing business; last fall he made an offer to buy some of MI Developments' loans to Magna but was rebuffed. But there aren't going to be many bidders who want to operate even the prime racetracks, and it is probable that nobody will want the lesser tracks in Magna's portfolio, such as Thistledown in Ohio.