Slow Goes It On The Illinois Racino Front At Hawthorne And Fairmount Park

State's tracks are moving at a deliberate pace when it comes to their bids to expand into racinos
Illinois racing updates to IGB

To use horse racing parlance, it feels as though racino plans at both Hawthorne Race Course and Fairmount Park in Illinois have barely entered the backstretch.

The venues on the opposite sides of the state provided updates to the Illinois Gaming Board on Thursday, with Hawthorne having made physical progress in terms of demolition work but now needing financing to move forward with what CEO of Gaming Kevin Kline called a “14-month, shovel-ready project,” while Fairmount Park has plans to move forward with the beginning phases of construction with a goal of opening in the fourth quarter of 2024.

Both Hawthorne and Fairmount Park, the latter rebranded FanDuel Sportsbook & Horse Racing, were granted the options to expand into racinos as part of a massive gaming expansion bill signed into law by Illinois Gov. J.B. Pritzker in June 2019. Both locations have onsite sportsbooks, while Hawthorne and sportsbook partner PointsBet also offer retail sports wagering at three off-track betting locations — the maximum allowed under the law.

Hawthorne was found “preliminary suitable” by the IGB to expand to a racino in July 2020 and opened its retail sportsbook at the track in September of that year. Fairmount Park, which received its “preliminary suitable” designation in October of that year, opened its retail sportsbook in March 2021, but has yet to expand into off-track wagering sites.

The horse racing industry has foundered of late in Illinois, a plight exacerbated by both the COVID-19 pandemic and the departure of Churchill Downs Incorporated after the 2021 racing season. Churchill Downs, which holds a majority stake in Rivers Casino, completed its exit from the state in February after finalizing a $196.2 million deal to sell the land that included Arlington International Racecourse to the Chicago Bears.

Fairmount putting the pieces together

The updates felt somewhat like a reversal from the fall meeting that representatives from the two tracks had with the Illinois Racing Board when providing progress reports. In September, Hawthorne President and CEO Tim Carey struck an optimistic tone and had been waiting on financial-related disclosures to submit to the gaming board. In contrast, Fairmount Park General Manager Melissa Helton had few answers at that point, given there did not appear to be clear directives from owner Bill Stiritz.

Taking the reins for Fairmount Park at Thursday’s meeting was Regulatory and BSA/AML Compliance Officer Lynne Marburger. She said the group overhauled its original plans and opted to expand the clubhouse section of FanDuel Sportsbook & Horse Racing.

“This will allow us to maximize space of the FanDuel original sportsbook investment located in the clubhouse and will also allow for no disruptions to live horse racing operations in the grandstand building, which complies with the gambling act,” explained Marburger to the board via conference call.

The first phase of racino construction, which would begin this summer with IGB approval, would create 16,000 square feet of gaming space and allow for 450 to 600 gaming positions when including table games. There would also be a backroom buildout spanning an additional 17,000 square feet. The second phase would include expanding the gaming area to have up to 900 positions, while enhancing dining areas and space on the second and third floors.

Marburger added that Fairmount Park is in negotiations with a general contractor for construction, while an architectural contract has been “executed for the final layout.” The group has also reached out to all licensed Illinois suppliers of casino management systems and is in negotiations with the city of Collinsville regarding a tax-implement financing (TIF) agreement.

Demolition work at Hawthorne largely done

After an opening statement from Carey, in which he reiterated his pledge to be the steward for horse racing in the state, Kline provided a slideshow with his comments showing the work that had been done at the Stickney venue in the south suburbs of Chicago. Much of the construction work done was to clear out the lower levels of the grandstand and glass facade as part of the planned aesthetic to have the track visible from inside the casino.

Kline cited a host of factors — including the pandemic, supply chain disruptions, and inflation woes — as reasons why Hawthorne has not been able to finalize financing. The track is doing double duty for both harness and thoroughbred racing for the second straight year, and conducting both disciplines requires the course to be “flipped” to accommodate the two styles.

Hawthorne cut its takeout rate for win, place, and show bets for the recently started thoroughbred season from 17% to 12%. When including off-track wagering, Hawthorne has accounted for 85.7% of the $29 million in statewide horse racing handle through the first two months of the year, which is up 4.6% compared to the same period last year.

Fairmount Park has generated close to $3.3 million in total handle this year, with nearly 45% — more than $1.4 million — bet at the track.

Photo: Getty Images


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