Breeders’ Cup impact in Louisville estimated at $53.3M
Spreading the Breeders’ Cup World Championships over two days has roughly doubled the amount of money that the event is bringing to the Louisville area, according to a University of Louisville economist’s study.
The Breeders’ Cup, which returns to Churchill on Nov. 4-5, provided $53.3 million in new revenues across the region when it was held at the Central Avenue track last year, U of L’s Paul Coomes found. The last study done by Coomes for the Breeders’ Cup pegged the 1998 Cup’s impact at $21 million, or about $28 million when adjusted for inflation.
The 15 Breeders’ Cup races are worth $25.5 million in purses. Since 2007, it’s been run as a two-day event, and last year’s cup at Churchill was the first there under the new two-day format.
Making the race card a Friday and Saturday affair has clearly benefited the local hotel market, said Lisa Haller, executive director of sales and marketing at the Galt House Hotels.
“When Breeders’ Cup happens it’s an infusion of demand to our city, so it’s always a good thing,” she said. “The fact that it’s added to two days makes it even better.”
The event’s overall economic impact makes it one of the biggest revenue generators for the Louisville tourism industry behind only the Kentucky Derby and the Ryder Cup, said Jim Wood, president of the Greater Louisville Convention & Visitors Bureau. Other professional golf events would come after that, he said.
Coomes said he based the study on the financial results of the event, local monthly hotel room tax data, ticketing data, a license plate survey around the track and models that helped determine spending in other areas. The impact estimates exclude money that would have been spent regardless of the event being held locally.
“It’s similar in nature to the Derby,” Wood said. “The pure horse racing aficionados, they love coming to the Breeders’ Cup because you have all the greatest horses competing during the day.”
“We’d love to have the Breeders’ Cup every year here in Louisville,” he said.
Including this year and last, Churchill has been host to eight of 28 Breeders’ Cups, but when it will return hasn’t been determined.
Breeders’ Cup officials said they haven’t made any decisions beyond next year’s running at Santa Anita Park in California. Officials have been discussing the 2013 event with Belmont Park in New York.
“It’s hard to get much more regular than eight times in the history of the event,” said first-year Breeders’ Cup CEO Craig Fravel.
“Churchill is always in our thoughts,” he said, but the Breeders’ Cup’s board is still working on a strategy regarding a long-term approach to future sites.
The event has posted many of its best numbers at Churchill, which has provided its top six attendance days.
“We’re very proud of the fact that this track and this community really embrace this event, embrace horse racing, and draw the biggest crowds,” said Churchill president Kevin Flanery.
For years, Breeders’ Cup officials have said Churchill is the biggest money maker for the event among the locations where it has taken place.
Fravel said that remains true, but comparing it to Santa Anita in 2008 and 2009 is difficult because of the recession those years. “Probably Churchill in terms of overall return is somewhat higher,” he said.
This year, Flanery said ticket sales are “about flat” compared to last year. “We’re very pleased with where we are. We feel like we’ve held up really well given the economy and everything.”
The Galt House’s Haller also said this year’s demand is “about the same” as last year. Wood said hotels should be nearly sold out for the weekend. Last year, occupancy was at 94 percent in Jefferson County hotels on both the Friday and Saturday of Breeders’ Cup.
“Demand for the Breeders’ Cup is always strong,” Wood said.
Because of that demand, the convention bureau successfully asked an association of middle-school educators, staff and parents to move its Louisville convention to the week after the Breeders’ Cup to accommodate both events.
“That’s how important we believe the Breeders’ Cup is,” Wood said.
The UofL study found that just over half of last year’s attendees lived more than 100 miles away — Louisville-area residents accounted for 36 percent of the tickets sold, compared to 48 percent in 1998.
Visitors filled 40,200 hotel room-nights in the 13—county Louisville metro area, which includes Southern Indiana. Those room nights led to an estimated $7 million in hotel room sales in the area.
Coomes looked at November hotel bookings in Jefferson County since 1990 and found that “there is a clear increase in November hotel activity in years when the Breeders’ Cup is held in Louisville. More hotel rooms are sold, average room prices are higher, and occupancy rates are higher.”
Breeders’ Cup spokesman Jim Gluckson said the event has made a more-concerted effort to attract guests from farther away and recently revamped its ticketing processes to better keep track of buyers.
Coomes said the increased economic impact isn’t surprising, giving the greater percentage of out-of-towners and just the amount of time since the last study.
“It’s a two-day event,” he said. “I’m sure ticket prices are higher. Spending is higher. Hotel room spending is higher. Restaurant spending is higher.”
The study also found $7.8 million in direct spending on food and at restaurants and bars.
Fravel said the 2010 economic impact study makes “sure everybody understands the value of the event and they begin to view (Breeders’ Cups) in the same positive light as a Super Bowl would be or an all-star game,” Fravel said.
Kentucky law already exempts the Breeders’ Cup days from the state’s pari-mutuel tax, which is an incentive to keep the event in the state regularly.
Written byGregory A. Hall | The Courier-Journal
Oct. 28, 2011