Study: Keeneland Provides $590 Million Impact

A recently-completed University of Kentucky economic study determined that outside visitors to Keeneland race meets and sales delivered a $590 million annual impact on the Lexington economy.

The Center for Business and Economic Research at the Gatton College of Business and Economics at the University of Kentucky study determined that direct spending on the sales amounted to $228 million and direct spending on the racing totaled $123 million. Direct spending numbers include spending by visitors on retail, gasoline, lodging, food, and beverages by visitors primarily in Lexington to attend the races or sales.

The study credits Keeneland's two 2014 race meets with a total economic impact of $200 million and its sales with a $390 million total economic impact. Total economic impact includes dollars brought in by visitors to Keeneland that are then spent again in the community.

All of the numbers were based only on spending by people from outside of Lexington's Fayette County.

Keeneland president Bill Thomason said the numbers impressed him, and he noted that they are conservative. He said if economic impact on surrounding counties is included, the numbers go up another $200 million.

Thomason said many businesses and people in the Lexington area are aware of Keeneland's economic impact, but this study will give them a better picture while informing those who weren't fully aware. 

"This puts it in terms that a lot of other people can understand," Thomason said. "We thought that was important, just to add to the picture of what our industry provides and what Keeneland provides as part of that industry."

The study focused on last year's fall meet, September yearling sale, and November breeding stock sale and used  figures from those events to estimate the impact from Keeneland's other sales and its spring meet in 2014.

Chris Bollinger, who directed the study at the University of Kentucky, said visitors at Keeneland and in an online survey were asked about their spending habits. Stats from Keeneland sales and racing also were used. Pari-mutuel handle figures were included in the study, but they were based on the amount of money wagered by these out-of-county visitors. Horse sale figures were included in the study if the Thoroughbreds were purchased by buyers from outside of Fayette County.

"The primary focus of the study was to determine the amount of money coming into Fayette County," Bollinger said.. 

The study did not include an estimate of added money expected to come in this year when Keeneland hosts the Breeders' Cup World Championships for the first time. It also did not project an estimated decline from the April 2-year-olds in training sale not being conducted this year.

Thomason said the study will help with some of Keeneland's marketing efforts and will help the track strengthen its ties with sponsors and other community businesses.

"We're working with the community and business partners. We're hoping this will be a tool for them to help continue to grow the fan base," Thomason said. "Especially coming out of Breeders' Cup, it will be important for our future."

While the racing industry is well aware of Keeneland's international success at sales, Bollinger said the study was an eye-opener for him in that area.

"The thing that impressed me the most was that the sales, rather than the meet, show an international market here," Bollinger said. "Keeneland is taking local horse production to an international market."

Kentucky Gov. Steve Beshear and Lexington Mayor Jim Gray congratulated Keeneland on the study.

"I don't think anyone is surprised by the tremendous economic impact Keeneland has on Lexington and Fayette County," Beshear said. "The study reinforces for us all the attraction to and the significance of this world-class venue.

"With Keeneland hosting the Breeders' Cup World Championships Oct. 30 and 31, its mark on the local and state economy is only going to increase in 2015. I congratulate Bill Thomason and his team for commissioning the report, and look forward to Keeneland's ongoing successes."   

Gray said Keeneland adds to the Lexington community and noted that not everyone is aware of its economic impact.

"Lexington is proud to be home to Keeneland Race Course. We love its beauty and the excitement of watching the world's best Thoroughbreds fly around the track," Gray said. "But when we think about Keeneland, we don't always think about the major impact it has on the local economy. The world's largest and most important Thoroughbred sales; the horsemen and visitors Keeneland attracts from around the world who stay in our hotels and eat in our restaurants; and later this year, the Breeders Cup World Championships, which will put Lexington on an international stage. It all adds up to another reason to be glad Keeneland is part of our community." 

Thomason said Keeneland looks forward to continued efforts to grow the community.

"Keeneland has been a special part of the Central Kentucky culture since its inception in 1936," Thomason said. "We've long known that Keeneland plays an important role in Thoroughbred racing and breeding. It is rewarding to learn that our racing and sales provide not only a means to showcase Lexington to a global audience, but they also serve as a significant economic engine for Fayette County. Keeneland receives such strong local support, we are pleased that the community, in turn, benefits from our business operations."