Problems at Magna's Gulfstream Park are much bigger than you think!

My comments, some of which were in cold storage
for months, follow the articles.
---------------------------
www.sun-sentinel.com/business/sfl-gulfstream-murphy-103109,0,6496345.story

South Florida Sun-Sentinel

Gulfstream Park's president quits suddenly

By Nick Sortal

October 31, 2009

Gulfstream Park President Bill Murphy resigned Saturday, according to a company press release.

Murphy could not be reached for comment and no reason was given for his abrupt resignation, which took effect Friday.

Murphy joined the Hallandale Beach horse track and casino in June 2006 as a vice president in charge of racing. Gulfstream's parent company, Magna Entertainment Corp., promoted him to president and general manager in January 2007.

Just prior to his promotion, Gulfstream Park added slot machines and in February, 2010, it plans to open a $1.2 billion mall with restaurants, nightclubs and stores, including a Crate and Barrel and a Pottery Barn.

The casino's slots revenues run third behind the Isle Casino & Racing in Pompano Beach and Mardi Gras Gaming & Racetrack in Hallandale Beach. But Murphy, who in an interview last month called himself "more of a horse guy than a casino guy," pointed out that neither of those racinos have the racing revenues Gulfstream does. Four of the past seven Kentucky Derby winners raced at Gulfstream.

State figures also show Gulfstream is the only of the three with an increase in slot revenues this year; they're up 5 percent.

Magna, however, declared bankruptcy in March and is selling off pieces of the company, including a horse track last month. Experts had suggested Gulfstream would not be for sale but a recent Wall Street Journal article suggested creditors are pushing for Gulfstream to be auctioned off in February.

In 2007, Gulfstream got into trouble with the state after it was discovered that employees had stolen hundreds of thousands from machines using free-play cards. There also were delays in building The Village at Gulfstream, which was supposed to open two years ago.

The state this past August said it would fine Gulfstream $800,000 in the theft, citing poor oversight. But Gulfstream is arguing that the state, which screens the hires, cleared two perpetrators who had criminal histories.

In the news release, Murphy thanked Magna for "the opportunity, and honor, of working with an incredible staff and with the greatest horsemen and jockeys in the world."

Nick Sortal can be reached at nsortal@sunsentinel.com or 954-356-4725.

Reader comments:
http://www.sun-sentinel.com/business/sfl-gulfstream-murphy-103109,0,1013215,comment-display-all.story

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http://www.baltimoresun.com/business/bal-bz.magna15oct15,0,3187143.story

Baltimore Sun
Tracks to go on block
Bankruptcy judge OKs auction of Pimlico, Laurel early next year
By Hannah Cho

October 15, 2009

WILMINGTON, Del. - A federal bankruptcy judge approved Wednesday a plan to auction
Pimlico Race Course and Laurel Park early next year, over objections from the tracks' former owners, who opposed the speed of the sale.

Meanwhile, two potential Maryland buyers - developers David S. Cordish and Carl Verstandig - reiterated their interest in bidding on the tracks and the Preakness Stakes.

Magna Entertainment Corp., the Canadian firm that owns the racetracks and the Preakness Stakes and filed for bankruptcy protection in March, said the auction should be held quickly because Maryland law gives the state 60 days to review a deal and the right to match any bid.

The sale procedures also would require potential buyers to keep the Preakness, the middle leg of racing's Triple Crown, in Maryland, satisfying concerns of the state and others in the horse industry who had feared losing the state's single largest sporting event.

But Benjamin Feder, a lawyer representing Joseph De Francis and other former owners, argued that the sale procedures do not consider the group's rights to slots and other alternative gambling at the racetracks, particularly at Laurel Park. When the former owners sold their controlling interest in the Maryland Jockey Club, the umbrella organization for the two tracks, they entered into a deal with Magna to split the proceeds from any alternative gambling development.

Feder also revealed in court that De Francis and other former owners have engaged in talks with Magna about the Jockey Club assets.

De Francis said the group has submitted several proposals on "how they might recapitalize the Maryland assets and allow them to emerge from bankruptcy."

Asked whether any of the plans include the group buying back the tracks, De Francis said he could not discuss the details.

"We continue to be very disappointed that the Maryland assets are in bankruptcy and very interested in any plan that might bring them out of bankruptcy and restore them to viability," he said.

Magna, which filed for Chapter 11 bankruptcy protection in March, withdrew a proposal to auction the Maryland tracks last spring, in part because of objections by the state. That plan did not take into account the state's "right of first refusal" for the Preakness, which has a "chilling effect" on Magna's sale efforts, according to court papers filed by the company last week.

To ensure that the Preakness would stay in Baltimore, Maryland lawmakers passed a law this year granting the state the right to seize the event under eminent domain.

After the hearing before Judge Mary F. Walrath in federal bankruptcy court in Delaware, Gregory Cross, a Venable LLP bankruptcy attorney retained by the state of Maryland, said, "We have agreement that the Preakness will remain in the state, the state's matching right to the Preakness is taken into account in the sale, and the state will be afforded the opportunity to review all prospective purchasers in advance.

"We didn't have any of that in the spring. Our position has significantly improved. Most importantly, the Preakness is staying in the state," Cross said.

The auction procedure for the tracks has several steps.

Potential bidders have until Nov. 2 to submit proposals to Magna. They must provide a 10 percent deposit, as well as evidence that they have the money to complete the deal.

On Nov. 9, Magna is to give the court a lead, or "stalking horse," bid for the Maryland assets. The state is to receive the names of the other bidders on Dec. 7, but they won't be released to the public.

The auction of the Maryland assets is to be held on Jan. 8.

Besides reviewing bids, the state has preserved its right to request that it be allowed to match the winning bid from the auction.

Cordish, whose Cordish Cos. is being considered for Anne Arundel County's sole license to operate slot machines, said this week that the company is "very excited about the prospect of buying the tracks and the Preakness."

The Anne Arundel County Council has not approved a zoning change needed for the Cordish slots project to proceed. Cordish said his proposal for a casino at Arundel Mills will not change.

"We will be sending over $60 million a year to the tracks from slots revenues at [Arundel] Mills," he said. "It makes sense for us to own the tracks. We will have the resources to revitalize the horse industry in Maryland and return it to its former glory."

Verstandig, whose America's Realty LLC in Pikesville often invests in distressed urban shopping centers, said he and a partner with experience in horse racing would upgrade the two racetracks and attract other entertainment venues. They also would build office and retail space on land around the tracks.

"Since they came into play again, we want to try again," he said.
--------------------
Auction timeline

Nov. 2: Bids due.

Nov. 9: Magna will provide to the court a lead, or "stalking horse," bid for the Maryland assets.

Dec. 7: The state will be given names of other bidders.

Jan. 8: Auction

Reader comments:
http://www.baltimoresun.com/business/bal-bz.magna15oct15,0,7207072,comment-display-all.story
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The following are selected excerpts from an
email that I sent around South Florida and
points north on the evening of October 27th,
2009.

It was sent to people I know and trust, certain
elected officials throughout the region and state,
and certain savvy members of the news media,
all of whom have an interest to some degree
or another in whether or not Gulfstream Park
Race Track and the upcoming Village at
Gulfstream retail center -scheduled to open
at the beginning of February- will be run
in a smart and dynamic way, or whether they
will continue to flounder in all sorts of embarrassing
and self-evident ways, as has been the case since
I returned to South Florida six years ago.

Anne Arundel County, described above in the
Baltimore Sun article, is home to Annapolis,
where the state capitol and state legislature are
located, along with the U.S. Naval Academy
and a few well-regarded liberal arts schools,
so it's very upscale with small enclaves of rural
chic on the water and elsewhere.

Think J.G. Hook preppy chic on the Harbor.
Because of its ideal location, it's equally popular
with folks from both the Baltimore area and
the greater Washington area.
In an average year, I'd probably go up there
from Arlington County maybe 6-8 times with
friends.

To my mind, there's no real counterpart to it in
Florida as a whole, which is a shame, because
the historical charm is a real draw and doesn't
seem bogus and contrived the way so many
things down here do.

Despite all the tourists, you can still feel the
authenticity of history there, and for someone
like me with my particular interests, that's
very appealing.

Meanwhile, over at Gulfstream Park,
another Magna property, the same old
incompetence continues, with little apparent
regard for appearance, customer safety or
appeal, with visible trash in the same place
as it was last week and the week before that...

Last night, as has been the case more often than
you'd think possible for a business that's in the
entertainment business and wants you to come
onto their property, ALL the access, auxiliary
and parking lot lights from the entrances on both
U.S.-1 and Hallandale Beach Blvd., to far onto
the main area, were out.
All of them.

Pitch black!
At 7:55 p.m., when sundown is around
6:45 p.m.!

And they wonder why things are the way
they are?

Below, just a few photos from among the hundreds
I've talen over the past few years showing what's
really been going on at the place that ought to be
a real magnet for fun and amusement for the region,
and a local source of pride, but which instead is
an often dreary, myopic and poorly-managed
mess of an operation that can't seem to get out
of its own way.

In the near-future, you'll see even more confounding
and jaw-dropping photos in this space highlighting
often self-evident problems, but for now, here's a
quick bite to whet your appetite and open your
eyes a bit wider.

All photos below by South Beach Hoosier.



Above, the newly-built median entrance off U.S.-1
that does absolutely nothing to fix the longstanding
drainage (read flooding) problem there that goes
back many years and years...

Standing water often remains there for quite some
time, which doesn't exactly create an inviting
atmosphere for customers who have plenty of
entertainment options.

Seriously, why has that not ever been
properly fixed?



Above, the bottom portion of the Gulfstream Park
sign on the Northwest corner of the property, facing
south-bound traffic on U.S.-1/South Federal Highway.

Located on Hibiscus (i.e S.E. 2nd Street) just off of
U.S.-1 -and near the Forest City office trailer-
the sign used to be internally illuminated, but then
became external early this year, with a view of the
main buildings peeking thru at the bottom.

That sign hasn't been illuminated at night,
internally or externally, since around
Thanksgiving or so!

Nothing shows the lack of respect for potential
customers and the lack of first-class public relations
like half-assed negligence that never ends.

In fact, one of the two spotlights on the ground
in front of the sign that could be used to actually
shine a light on the situation has been missing for
many. many months.

As you can see for yourself, they don't even bother
trying to keep up appearances there.

That's a VERY bad sign for customers looking to
spend their money somewhere that's properly run

For the better part of the first six months of this
year, while the track was open, the track had rental
message boards plopped quite unattractively on the
median of south-bound U.S.-1, desperate to remind
people passing by that the place was actually open.

Naturally, this being South Florida, the sign was in
English, French and Spanish, but I never really quite
understood how it was that Gulfstream was able
to legally keep those signs on public property for
months on end.

It made the whole area look blighted!



Above, as if their very own promotional sign not working
for about a year isn't bad enough, it doesn't really help that
they also allowed vines and vegetation to grow eight-feet
high and higher, and start taking over the damn sign.

It doesn't just look like nobody cares cares,
when you're standing there, it feels like nobody cares.

It's not Wrigley Field chic, it's just unsightly.
Month-after-month-after-month.



Above, looking south from the Hallandale Beach Blvd.
entrance to the facility towards the pitch-black conditions
on the access road and the fairly-new employee dorms.

In case you didn't know, the dorms are right in the way
of extending S.E .2nd Street to 14th Avenue, a plan the
city has been considering since the early 1970's to
unclog the unbearable traffic conditions of HBB.

The road is necessary for some of the planned
development projects on HBB, like Oasis, in order
to prevent the current traffic saturation from getting
even worse for longer periods of time than currently.

Question: Why did the Hallandale Beach P&Z
Advisory Board and the HB City Commission
both vote to give Gulfstream Park the okay to
build the two separate dorm buildings there a few
years ago if they ALREADY KNEW that the
specific area was absolutely crucial to the city's
ever being liveable in the future?

Four people involved in that asinine decision are
still wrecking havic at HB City Hall:
Mayor Joy Cooper and Commissioners Dotty
Ross and William Julian.

The next time you see one of them, why don't you
ask them to answer the simple question of Why?,
and to explain to you why they refuse to give HB
City Manager Mike Good specific guidelines and
deadlines in negotiating with Gulfstream and Magna,
instead of simply letting him do whatever he wants,
with absolutely no oversight ro speak of, and with
hundreds of thousands of dollars to play with?

What some in this city call 'rogue negotiations.'

You'll be reading and seeing a lot more on
the topic of the extension of S.E. 2nd here
in the coming weeks and months.
Lots and lots of photos!

Reminder: The only reason you actually
see the road in the photo above is the
flash from my camera.




Above, one of the unlit auxiliary lights near
the dorm.




Above, from the same exact location as the previous
photo looking north towards HBB after a car has
passed in the dark of night.




Above, the unlit double-lights near the interior
of the public parking lot.




Oh well, at least the illuminated signs for
Crate & Barrel on U.S.-1 are working
at The Village at Gulfstream, three
months before the retail complex opens.

All the shots above are from Tuesday
October 27th.

It's fair to say that the series of posts I'll be
writing here about Gulfstream Park and
The Village at Gulfstream over the next
few weeks and months will include more
than their share of ripping and constructive
criticism, based on self-evident facts that
I've personally observed over the past
few years.

Part of that is a natural byproduct of what
I and many others in the community have
perceived as Gulfstream's very dismissive
know-it-all attitude towards those who
aren't already part of their co-opted little
family in Hallandale Beach and this part
of South Florida.

I suspect that many, if not most of you,
will come to learn a lot of things you never
knew or noticed before about them and their
myriad operations, including a few interesting
history lessons about how rocky things have
been in the past between the race track and
the city since it was first built.

But I'll also have some very good practical
and well-thought out suggestions for making
things much more interesting and fun over
there, because quite frankly, interesting and
fun is NOT at all what it is now, or has been
in the recent past.

Some of my suggestions may even strike you
as inspired, but many will seem like common
sense and may even be ones that you've
thought about yourself over the years.

I make the suggestions because I want it to be
better than it is now, or seems to aspire to be.
But it won't always be pretty, of that I have
no doubt.

And when I say that I've taken hundreds of
photos, I'm not joking.

I have plenty already to prove my central points.

"Gone were the topless women, and the teens who raced and stumbled across the tops of portable toilets, pelted with beer cans as they went."

Preakness, I barely knew ye.

While this Washington Post article is a little more

pronounced than some of the negative articles I've

been reading the past few months in the Baltimore

Sun on the dismal horse racing scene in Maryland,

it's a bigger part of the overall pattern.

The problem is that the patient is in critical care

and the doctors are running out of options.

Actually, compared to the tangible dynamic energy

and history of the Kentucky Derby at Churchill

Downs in Louisville, a place I love, and the first

race of the Triple Crown -always a huge getaway

weekend before the final end of school for nearly

everyone I knew at IU, due to the short distance

between Louisville and Bloomington and the fact

that SO MANY PEOPLE were from there-

The Preakness at Pimlico during my 15 years

in the Washington, D.C. area was noteworthy for

little more than the fact that the public drunkeness

there was such a neverending and embarrassing

spectacle for all concerned, not least, the State

of Maryland and the parents of the kids who

annually made a menance of themselves.

It was like a 1950's film on juvenile delinquincy

but one not lensed lovingly by Baltimore's own

Barry Levinson, and there in the track infield,

every other kid looked like a future low-life

convict that would prey upon the community,

including the longtime pals from Levinson's

Diner, which I watched again this past week.

http://www.imdb.com/title/tt0083833/

How do you not know where to put the

Charlie Parker album, Beth?

Listening to D.C. and Baltimore media people

go on every year about it, most especially,

hearing The Sports Junkies recount crazy

stories they personally experienced or heard

about, was like hearing a trusted friend go on

and on about an old relationship with someone

whom you never met and for whom there

are no extant photos of.

http://junksweb.com/site/

You try to put it together in your head,

and keep waiting for the part of the story

where you hear what the initial attraction

was, met cute, before it wound up so

horribly, horribly wrong.

But that part never ever comes, it's always

just the seamy underside of the relationship

that gets continually discussed.

That's The Preakness!

Coming soon: discusssing the many, many

problems over at Gulfstream Park Racing

& Casino, complete with lots of photos.

Trust me, there's literally a mountain of stuff

to talk about on that subject, not just the

actual racing or the Village at Gulfstream

angle or...

And that's not just my opinion.

I just happen to be in an unusually-close position

to observe it and share my opinions, which many

people across the country have written to me

about over the two-plus years this blog has

been operating.

One thing is certain, people are tired of being

disappointed by it and the customer service

experience, over and over.

-----------------------------

http://www.washingtonpost.com/wp-dyn/content/article/2009/05/16/AR2009051602390_pf.html

At Troubled Preakness, a Sobering Attendance Drop

By Lisa Rein
Washington Post Staff Writer
Sunday, May 17, 2009

BALTIMORE -- The future of Maryland's storied horse racing industry might be a matter of debate, but one thing was clear yesterday at the yearly race that has been the state's biggest sports event for more than a century: The Freakness is gone.

The usually crammed infield at the Preakness Stakes, which earned that nickname because of drunken fighting and other forms of debauchery, was far from full as post time neared. Gone were the topless women, and the teens who raced and stumbled across the tops of portable toilets, pelted with beer cans as they went.

To restore civility to what had become little more than an all-day party, officials at the Pimlico Race Course in Baltimore banned spectators this year from bringing their own beverages, including beer, onto the infield. The move contributed to a 30 percent drop in attendance, and it drew plenty of complaints.

"I'm here, but I'm not happy," said Chad Jones, 35, a mortgage broker from Baltimore. He was among a smattering of fans on an infield that ordinarily draws 60,000.

Those who stayed home forfeited the chance to see Rachel Alexandra become the first filly to win the Preakness in 85 years, holding off Kentucky Derby victor Mine That Bird by one length and Musket Man by 1/2 lengths.

Rachel Alexandra had drawn all the pre-race attention after her victory in the Kentucky Oaks the day before the Derby, and she did not disappoint yesterday as she led the all-male field for almost the whole race, covering the 1 3/16 miles in 1:55.08.

That so few people turned out to see the race was the latest blow to Pimlico and the Preakness, the second race in the coveted Triple Crown.

Attendance dropped 7.5 percent last year, to 112,222, and it fell yesterday to 77,850, track officials said. A referendum legalizing slot machines in Maryland has produced no money for the state's ailing horse racing industry. And Magna Entertainment, the Canadian conglomerate that owns the Preakness, is in financial straits.

The company filed for bankruptcy in March, saying it would put Pimlico up for auction. It relented only after Gov. Martin O'Malley (D) and state lawmakers threatened to seize the track by eminent domain.

O'Malley, on a tour of the stables before post time, repeated his pledge to "do everything we can" to keep the Preakness at Pimlico.

"I look forward to seeing it run for another 134 years," he said in a nod to the Preakness's first race at Pimlico, in 1873.

Tom Chuckas, president of the Maryland Jockey Club, which operates Pimlico, said he expected the ban to cut into ticket sales this year and next. Even so, he said, the infield -- a world away from the dresses and heels, linen suits and fedoras worn by some in the grandstand -- needed to change.

"We're trying to elevate the experience for everybody," he said. "Sometimes a short-term loss turns into a long-term gain."

Beer and black-eyed Susans, the event's signature drink, still could be had. But thousands of racing fans -- and fans of one of Maryland's wildest parties -- could not be consoled by a 16-ounce plastic cup of Budweiser for $3.50.

"We're missing about 30,000 people right now," said Sean Robinson, a track employee who was checking coolers to ensure that no beverages were smuggled in.

In an effort to keep the infield crowd, ZZ Top performed, and a bikini contest was held. An 8-11 a.m. breakfast bash featured $1 drafts of Bud Light.

None of that was enough to bring back Ryan Goff, 24, a Baltimore resident who works in media marketing and started one of many Facebook groups that protested the change. "What's the point of going?" someone wrote on one of the pages. "As if there's some reason to be there other than drinking and partying."

Reached by phone, Goff said, "For them to make this change was ludicrous for a struggling racetrack."

For all the criticism, the new policy also drew some new spectators. Mark Lennon, 30, who works at the University of Baltimore Law School, said he had stayed away from the infield for years because of its rowdy reputation.

"I was hesitant to come," Lennon, of Baltimore, said. "I'd like the day to be about the actual event, which is horses."

Reader comments:

http://www.washingtonpost.com/wp-dyn/content/article/2009/05/16/AR2009051602390_Comments.html

re Gulfstream Park -Bankruptcy looming for Magna Entertainment?

As of a few hours ago, according to the Daily Racing Form, it looks like bankruptcy looming for Magna Entertainment -Bankruptcy looms on horizon for Magna.

Not mentioned, possible effect on Gulfstream Park's racing operations, like a (fire) sale, perhaps, after this racing season is over?

H-m-m-m... the plot thickens.

The Miami Herald had the following AP dispatch on their website Thursday, but have no original reporting on this: Spin-off of Gulfstream Park operator is canceled

http://www.miamiherald.com/business/breaking-news/story/911231.html

 

I haven't seen anything about this on local TV, as everyone is making nice with celebrity chefs on South Beach this weekend, showing the real limit of their reportorial skills.

Magna filed an 8-K with the SEC today which you can see here:

Magna Entertainment Corp · 8-K · For 2/18/09

http://www.secinfo.com/$/SEC/Registrant.asp?CIK=1093273

For many months, I've been meaning to write in-depth about all the many problems and very curious things I've observed in, at and around Gulfstream Park over the past few months, as they hurried to make themselves look presentable for its first race back in early January, even as construction continued at the Village at Gulfstream retail project being handled by Forest City Enterprises Inc., not Gulfstream.

Over the past year, I've snapped a few hundred shots of the construction work going on there along U.S-1/South Federal Highway, as well as those very curious things that I alluded to, which not only consistently showed a lack of marketing common sense or prowess, but which also showed a remarkable lack of concern for their customers' safety.

Naturally, with Hallandale Beach City Hall just across the street, the city's own gross indifference to safety and awareness issues, right in front of them, goes back years.

I'll document that at some point over the next few days with photographs that will make my points crystal-clear.

Postcards of Gulfstream Park -"back in the day."
http://www.cardcow.com/search2.php?substring=gulfstream%20park

As someone who's always been very interested in historical preservation, and who used to read the magazine Preservation cover-to-cover, I always thought that, media-wise, even for South Florida's very low journalism standards, there'd have been more made about one of the few iconic structures in South Florida going buh-bye.  http://www.preservationnation.org/magazine/

And by that, of course, I mean so little attention paid or even fuss made when the old Gulfstream Park

grandstand came down, especially compared to the fuss and coverage of the implosion of the Bal Harbour Sheraton, or, more recently, the Miami Arena, a building I never stepped in since I was living in Chicago and Washington, D.C. during its very short heyday.

Is it just me, or does it seem that most TV news directors down here have become so jaded over the years, sent so many news reporters to cover faux news over on South Beach, City Hall or downtown Miami, that when something historical actually comes down the pike, they channel the mantra of a dis-interested teenage girl -

"Whatever."

If WPBT-Channel 2 was really worth a damn anymore, they'd have produced an hour retrospective program on the racetrack, and what it used to be like in the old days, pre-Shula Dolphins, when South Florida's sports world revolved largely around the horses and the Hurricanes.

I've heard stories and tales from myriad sportscasters and reporters as well as the fabulous Spinelli Brothers, who used to cut my hair at their sports and show-biz memorabilia-filled shop on West Dixie Highway in North Miami in the 1970's.  It was like being in a museum of pop culture!

Every visit was a real treat because those guys were so completely plugged into everything that was South Florida sports and show-biz, from the '50's thru the '70's because of who they knew, their old location near Biscayne Blvd. & 79th Street (?), and the great loyalty of their famous customers, that you honestly never knew who'd you'd run into at their shop.

Often it was well-known names who'd swing by when they were in town just to shoot the breeze with them to find out what'd been going on, what was happening, who was in town, etc.

They had a huge extended family of customers and friends, famous and otherwise.

(Though their shop was located in North Miami, because I was a frequent customer as a kid, and loved their stories, the Spinelli Brothers even agreed to be my sponsor for Optimist football whenI played on the NMB 95 lb. team, even though I was playing for North Miami Beach Optimist.

Eventually, they received one of those large official sponsor frames and photo of me which they hung up in their shop.)

Channel 2 could've done a simple compare-and-contrast using extant photos at local museums interspersed with interviews with personalities, former employees and public institutional memories in South Florida who know a thing or two and can tell a great story, like Hank Goldberg or Edwin Pope.

Of course, I also have to blame myself for not taking a ton of photos at the time it came down, since if I had, I'd post them here for posterity.
C'est la guerre.

---------------------------------------------------

http://www.baltimoresun.com/business/bal-bz.magna20feb20,0,3519391.story

Baltimore Sun

Magna may not be able to pay off debt to controlling shareholder

Due date moved up for owed $275 million; future uncertain for beleaguered racetrack owner

By Bill Ordine

February 20, 2009

The credit leash on financially beleaguered Magna Entertainment, owner of Pimlico Race Course and Laurel Park, just got a lot shorter.

The company's controlling shareholder, MI Development, is abandoning a reorganization plan that had been criticized by the firm's minority shareholders. As a result, the due date on about $275 million in debt owed by Magna Entertainment to MI has been accelerated to March 20.

Both Canadian-based companies are controlled by auto-parts magnate Frank Stronach.

In a statement, Magna Entertainment said that it will not be able to repay the loans unless it can raise money "through an alternative transaction with MI Development, asset sales, by taking on additional debt or by some other means." The due date on Magna Entertainment's $40 million line of credit with a Canadian bank has also been moved up, to March 5.

Because Magna Entertainment owns the two Maryland race tracks and the Preakness Stakes, the state's horse industry is in a constant state of unease about the future of the tracks and the second jewel of the Triple Crown.

It remained unclear what Magna Entertainment's options might be, particularly since it has been trying to refinance its debt with other sources and sell real estate without success.

MI Development has already granted Magna extensions a handful of times over the past year. Magna Entertainment hired a firm specializing in restructuring debt and Chapter 11 bankruptcy last fall.

"If by some circumstances they did file for Chapter 11, it could get pretty crazy," said Maryland Racing Commission Chairman John Franzone, "because then you're at the mercy of a bankruptcy trustee."

Officials for Magna Entertainment could not be reached for comment.

Tim Rice, a managing partner in a stock brokerage firm whose clients once owned Magna Entertainment stock, said that Magna has passed up opportunities to liquidate real estate holdings at reasonable prices in the past.

"I'm sure that [Stronach] would do whatever he can to [prevent] the public shareholders from getting wiped out," Rice said, "but I don't know if he can do that."

But Franzone expressed confidence that Stronach will find a way out.

"Frank is a pretty savvy guy. He's faced crises in his auto business over the years and he's always pulled rabbits out of his hat, so I wouldn't count him out," Franzone said.

Magna Entertainment has used MI Development as a lender of last resort in recent years, to the chagrin of some MI minority shareholders.

The proposed reorganization would have eventually severed the relationship, but was undercut when a vocal MI Development shareholder, New York-based Greenlight Capital Inc., complained that the plan would convert the company's secured loans into shares of Magna Entertainment stock.

Magna Entertainment shares closed at 38 cents yesterday.

Part of the money that MI Development lent to Magna was supposed to be used to develop a new slot machine casino at Laurel Park. But the company's effort to secure a slots license was derailed when it failed to put up millions of dollars in required fees when it submitted its bid this month.

State officials threw out the Magna bid last week. Lawyers for the track's owners have taken the matter to court. State Senate President Thomas V. Mike Miller said the state should work to ensure that the Preakness Stakes stays in Maryland and that horse racing remains viable here. He compared any effort to save the tracks to building a baseball stadium or granting tax incentives to Hollywood filmmakers who bring their sets here.

"If we have an interest in having movies filmed in Maryland," Miller said, "then we certainly have an interest in somehow finding a buyer for our racetracks."

Baltimore Sun reporters Hanah Cho and Laura Smitherman contributed to this article.