Ashley Capital buys closed Hazel Park Raceway for redevelopment
The Hazel Park Raceway has a new owner that plans a large-scale development on the shuttered horse racing track’s remaining 95 acres.
New York City-based industrial/warehouse developer Ashley Capital, which has its local office in Canton Township, completed the purchase Friday, said Susan Harvey, senior vice president of the office. The plan is to develop two new buildings on the property, with one being about 600,000 square feet and the other being an undetermined size, although a roughly 900,000 square-foot building could fit there as well.
She declined to reveal the purchase price from the previous owner, the principals at Southfield-based real estate developer Hartman and Tyner Inc.
The track at the southwest corner of 10 Mile and Dequindre roads closed three weeks ago after 69 years and a long streak of losing money, including at least $1 million annually before the switch from harness to thoroughbreds in 2014.
“It’s a great site for the kind of buildings we build,” Harvey said.
Ashley Capital opened a sprawling commercial warehouse called the Tri-County Commerce Center on 36 acres of former track property last year after buying the land 2 1/2 years ago. The 575,000-square-foot building now houses operations for Amazon.com, LG Electronics and Bridgewater Interiors.
She declined to reveal the expected cost to build the 650,000-square-foot speculative building, but said they typically run about $50 per square foot. That would put the rough cost at $32.5 million. Construction is expected to start toward the end of the second quarter and wrap up by May 2019.
“Prior to it becoming a racetrack, I think in the 1940s, the site was an industrial landfill, so it’s a very challenging site to build on, but that was the same as the condition for the building we already built, so we are familiar with what we are facing there,” Harvey said, adding something commemorative will be incorporated into the site to recognize its history as a race track.
Demolition is expected to begin shortly after the brownfield process, which takes about 60 to 90 days, she said. Anything that the previous owners wanted to keep has been removed, so the entire site, including the man-made lake, will be leveled and removed to make way for the new building.
“There isn’t anything on the site that is of auction value, so everything that’s left will get demoed,” Harvey said.
Southfield-based Signature Associates Inc. will lease the building to tenants.
Friday’s sale marks a brutal month for Michigan horse racing tracks.
Last week, Farmington Hills-based homebuilder Hunter Pasteur Homes announced it is under contract to buy the Northville Downs horse racetrack and redevelop the 48-acre property for housing. The site near Sheldon Road and Hines Drive is expected to be turned into 500-600 apartments and for-sale townhouses and single-family homes, plus commercial uses.
Northville’s owner, the Carlo family, will seek to continue racing and wagering operations “at an area in close proximity to its current location,” according to the statement from Hunter Pasteur Homes. However, it’s unclear if the Carlos will pursue a new track without the state legalizing alternative forms of wagering, such as slot machines, outside of casinos.
Northville Downs can trace its roots to 1902, and became a pari-mutuel track in 1944.
Track land such as Northville Downs and Hazel Park are seen as more valuable for other purposes as interest in racing as declined.
Eight Michigan horse tracks have closed since 1998 as the public has instead opted to spend money at the commercial and tribal casinos across the state, and because the lottery expanded and online forms of gambling have proliferated. The amount of money wagered at Michigan horse tracks on live racing has fallen from $22.1 million across seven tracks in 2006 to $4.2 million at two tracks in 2016, according to state data. That’s an 81 percent decline. Combined live and simulcast betting in the state over that decade dropped from $281.1 million in 2006 to $103.2 million in 2016.
Hazel Park attempted to find new revenue over the years. As part of the $12 million grandstand and press box project in 2004, space for casino-style gaming was built in anticipation of slot machines via a measure approved by the Legislature but then-Gov. Jennifer Granholm vetoed. The building was never used. Plans for a brewpub and restaurant fell apart in 2014.
Over the years, the track added high-def TVs, a picnic area, and upgraded its food and beverage spaces.
It halted thoroughbred racing after the 1984 season, converting in 1985 to full-time harness racing. More than $300,000 was spent in 2014 to return the track to thoroughbred standards.
Live racing was scheduled to begin May 4. More than 40 horses were already at the track in preparation for racing season, but they must be removed by April 15. Others were reportedly refused entry this week.
Posted By: Crain’s Detroit Business on April 27, 2018. For more information, please click here to read the source article.
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