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Supreme Ventures Limited, SVL, intends to transform Caymanas Park into a diverse complex that’s centred around horse racing but offers other amenities off which it can make money.
Its plan includes the development of a three-star hotel on the 196-acre property that once was a sugar estate before it became Jamaica’s sole racing track.
SVL disclosed plans last week to pump US$100 million into the transformation of the property over the span of a decade. Seminal to that programme is a positioning of the facility as an attraction, in line with global trends.
The commercial centre and the hotel, which is expected to be about 12-storeys high, are included in the US$100m – or approximately $16 billion is local currency – but the precise costings are still to be finalised, SVREL Chairman Solomon Sharpe said in an interview with the Financial Gleaner.
To execute the capex programme on its terms, the company is hoping to take over ownership of Caymanas Park from the Jamaican government, which holds the asset through Caymanas Track Limited, CTL.
SVL Group made its intention known to Caymanas Track four months ago and the ball is currently in the Ministry of Finance’s court, to which CTL turned for guidance on how to respond.
The gaming and lottery company operates the track under a leasehold arrangement through subsidiary Supreme Ventures Racing and Entertainment Limited, SVREL, ranging up to 60 years.
Executive Chairman of SVL Group Gary Peart said the leasehold does not include an option to purchase Caymanas Park. But it does have an opt-out clause, he said.
Peart added pointedly that the company could have exercised the opt-out clause during the COVID pandemic, when the world went into lockdown, but did not because it was committed to the industry.
“Yes, we want to make money, but there is also the essential benefit to punter, horsemen, the community and the government’s coffers,” he said.
Horse racing only takes up a portion of the 196 acres; there are around 60 acres that can be put to other use, said Sharpe.
Under the 10-year programme, some changes will be made to the so-called backstretch to expand the number of horse stalls.
“Once you relocate the stalls in an efficient manner – and there are some other modernisation facilities of the racetrack and the racetrack operations – it will make the racetrack operations, the management of it, a lot more efficient,” the SVREL chairman said.
That element of the project, which deals with improvements to the track and racing facilities, is estimated to cost US$20 million to US$30 million, Sharpe indicated.
Right now, Caymanas Park is bleeding; it made a loss of around $400 million last year, SVL Group has said. Contingent on gaining ownership of the property, SVL’s intent is to transform Caymanas Park into a more modern facility with new income streams.
That’s where the commercial centre, which will offer office space for rent, and the hotel come in.
“So, you can build commercial offices over there and potentially have the head office for Supreme Ventures and other entities,” said Sharpe.
“You are going to get an office with a beautiful view, a beautiful breeze, because every visitor to the track that gets a seat in the director’s box absolutely loves the view,” he said.
Sharpe added that it’s little known that a special away team of persons from parent company SVL Group along with persons from SVREL, have been touring race venues across the world, including places like Australia, Hong Kong and the United States.
It’s basically a learning tour to garner knowledge on how the industry and the people involved in it keep their business afloat.
Making the case for a commercial buildout of Caymanas Park, Sharpe said several North American tracks incorporate a hotel, for instance, Oaklawn Park in Arkansas, to make their operations viable.
Also, in Nebraska, a racing track is being redeveloped and a hotel and casino form part of the redevelopment.
“They are going to build in a new facility based on them getting a casino licence. They’re going to build a racetrack and a casino, and their budget is about US$85 million,” Sharpe said.
Supreme Ventures envisions a property that doesn’t just cater to the racing crowd. It sees potential in the short-stay market, noting that right now, residences in Portmore were being transformed into short-term rental properties.
“It shows you that there’s a shortage of accommodation over there,” he opined. “When carnival and anything is happening there aren’t enough rooms.”
A three-star hotel could fill some of that gap, especially when the demand for accommodation is at its peak, he noted.
“To service a big community like that, you need a 200-room, three-star hotel, especially with Kingston being the epicentre of business” and entertainment, Sharpe said.
SVREL’s lease payments for Caymanas Park run to about US$320,000 per year. The lease spans 30 years, initially, eight of which have already rolled off, with an option for another 30 years.
Sharpe said the company wasn’t inclined to build a hotel on property it did not own.
“I can show you the site right now where the hotel would be, but I can’t build it because I’ll be a squatter. I cannot build on people’s place,” the SVREL chairman asserted.
As a rent-paying operator in the racing industry, it puts the company in an awkward place, given the pressing needs of surrounding communities and an industry with many spin-offs, Sharpe said.
“We have been told now that we must keep the industry up and alive. But the whole industry needs reform. This is the only sport, and this is the only thing of socio-economic value that is taxed at the source. We are actually taxed at gross revenue,” he observed.
Sharpe, a third-generation horseman – breeder, owner and trainer – adds that SVREL has been hamstrung in its efforts to grow the horse racing industry as operator of a track with a less-than-stellar financial history.
He recalls being laughed at whenever he suggested that the horse racing industry can top $15 billion in revenue annually. But he insists that top-line growth can come from better regulatory arrangements, improved infrastructure, and the optimal use of the near-200 acres on which Caymanas Park sits.
SVL Group has said it earned $10 billion in revenue from Caymanas Park last year.
The racing track is one mile and one furlong, with a width of 75 feet. Like practically all American racecourses, it is a dirt track, with a racing cushion of dune sand and loam.
Sharpe said that while the track itself and surrounding infrastructure will continue to be the centre of Caymanas Park’s operations, the development of a commercial centre, the addition of lights to allow 24-hour operation and the hotel will position the park, which sits in the middle of a dormitory community, to become part of Jamaica’s tourist industry.
As for the upgrades of the racing side of the operation, Sharpe said the section inhabited by the horses would be reconfigured and expanded to accommodate more horses.
The facility holds 1,150 stalls presently. They are located in the area that the horsemen refer to as the backstretch, behind the grandstand.
“We’re going to cut a more efficient backstretch. All of that is going to be reconfigured in a very efficient manner, and we want to have anywhere from 1,400 to 1,500 stalls at the end of the day,” Sharpe said.
More stalls and more horses mean more opportunities for race meets, he added, noting that the racehorse population is a disappointing 950 animals, allowing SVREL to run only about 80 race-days per year.
Were the horse population to climb to 1,400, SVREL could run 96 race-days for the year, he said.
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