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.

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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.