Churchill Downs Incorporated (CDI) has sold a substantial portion of property adjacent to its fully-owned Calder Casino in the Sunshine State for a tidy sum of $291 million. The purchaser? It’s none other than Link Logistics, a real estate powerhouse specializing in logistics and a valued asset within the Blackstone portfolio.
This wasn’t merely a small parcel of land. We’re discussing 115.7 acres, translating to a significant $2.5 million for each acre. Prior to this transaction, Churchill Downs possessed a considerable 170 acres in Miami Gardens. Currently, their holdings are reduced to a more concentrated 54 acres, essentially encompassing the Calder Casino itself. This agreement, initially disclosed in November 2021, concluded seamlessly, adhering closely to the original terms.
So, what does Churchill Downs intend to do with this influx of funds? They’re embarking on a series of investments, aiming to utilize the proceeds to finance their multi-billion dollar purchase of Peninsula Pacific Entertainment, a transaction that involves acquiring numerous properties.
Unveiled in February, this significant maneuver will see Churchill Downs allocate nearly $2.5 billion for the “overwhelming majority” of Peninsula Pacific’s holdings. It’s a strategic move that Churchill Downs projects will substantially broaden their presence in the gaming and leisure sector, particularly within the domain of historical horse racing.
Furthermore, it appears they harbor even grander ambitions. The Florida land sale earnings will also support investments in other real estate endeavors, all meticulously designed to capitalize on those favorable tax advantages provided under Section 1031 of the Internal Revenue Code.
The horse racing company, Churchill Downs, is contemplating the sale of a 15-20 acre parcel in Miami Gardens. Situated along NW 27th Avenue, the property has potential for commercial development. This decision follows a period of recovery for Churchill Downs post-pandemic. The first quarter of 2022 saw the company achieve unprecedented net earnings of $364 million. This strong financial performance has enabled them to pursue other investments, such as a $2 billion upgrade initiative for their primary racing facility in April.
