Arkansas Racetracks Take Opposite Turns

Featuring a new hotel and expanded casino, Oaklawn got off to an early start this season with December racing.

After 66 years of legal betting on both thoroughbred and greyhound racing, at the end of 2022 Arkansas will leave the dogs out.

Greyhounds will stop running by Dec. 31 at Southland Casino Racing in West Memphis, a favorite of dogged bettors since 1956. In contrast, Oaklawn Racing Casino Resort in Hot Springs, the state’s top tourist draw, is running an expanded horse meet that began in December with a near-record 66 race days scheduled.

Oaklawn opened a showcase eight-story luxury hotel in April, extending its reach for guests from surrounding states, and the hotel and early racing have propelled business at the casino, recently expanded by 28,000 SF of gleaming slots and gaming tables.

“The race meet actually has had the sort of impact that we were expecting, both on the casino front and the resort side,” Oaklawn General Manager Wayne Smith told Arkansas Business just before Christmas. “It helped in all phases of our business. So, at least judging from this December as an experiment, we’re quite pleased. The support from our race fans was nice to see, and the numbers were good considering we were going up against Santa Claus and all the events of the holidays.

“We’re looking forward to seeing how things go in the meat of our racing season, which is really February, March and April,” Smith said. “We’re starting to see a broader reach for our casino, with more folks coming from outside of Arkansas. It’s a testament to not only Arkansas tourism, but also a lot of what we have to offer, from racing to amenities like a luxury spa and new food and beverage outlets. And, obviously, the hotel.”

$100 Million Project

Nearly two years in construction, the $100 million renovation introduced new dining and drinking venues, a 14,000-SF event center and the Astral Spa, a state-of-the-art amenity in a town long known as the Spa City. The marbled and wood-paneled hotel lobby, lined with shelves of racing mementos and images like a photo from the 100th running of the Derby Stakes, dominates the ground floor, along with the new event center. A wide staircase and escalators lead up to the casino, the new First Turn Bar, overlooking that part of the track, and a fine-dining restaurant, The Bugler.

One casino patron, unbidden, spoke up to a note-taker. “This new section is something, right? So clean,” she said. “You should see the restrooms. Spotless!” (They were, by the way.)

The thermal waters of Hot Springs drew natives to the area for thousands of years before historic Bathhouse Row made an industry of it in the late 19th century. Illegal gambling also proved magnetic a few decades later, attracting gangsters like Al Capone, Lucky Luciano and Owney Madden. Racing was another pastime, and Oaklawn opened in 1904, but anti-gambling laws kept closing the track.

Oaklawn, owned by the Cella family of St. Louis for more than a century and now led by President and CEO Louis Cella, pushed to legalize parimutuel betting and finally succeeded in 1935. The horses have run regularly ever since, and in 2018, a statewide vote legalized full casino gambling. Oaklawn and Southland have been expanding ever since, and Saracen Casino Resort in Pine Bluff has been built from scratch. (See Saracen Draws New Funding.) A fourth casino is on the horizon in Pope County after years of legal challenges. (See Pope County Casino Still on Hold.)

The Hot Springs expansion projects Oaklawn’s horsey roots just about anywhere you look, from the thoroughbreds charging across the wall behind the front desk to Oaklawn’s familiar logo of four jockey figures with silks bearing the four suits from a deck of cards.

The north side of the new 198-room hotel overlooks the track, which Smith said was a nod to the fact that Oaklawn will always hold thoroughbred racing close as its core enterprise. “We will always be about racing at Oaklawn.”

Dog Racing in Decline

The West Memphis racing casino is going the opposite way, closing out greyhound racing after a three-year wind-down. After 6,656 separate races in 2019, Southland cut back to 4,992 in 2020 and 3,994 in 2021. This year, it plans 2,662 races before ending its long history with a sport that’s clearly doomed in the United States.

Iowa, West Virginia and Arkansas are the only three states left with active greyhound tracks, and Iowa Greyhound Park in Dubuque, like Southland, is ending racing this year.

Animal protection laws and gaming restrictions make greyhound racing illegal in 41 states, including Florida, which shut down all dog racing last year. Since 2001, 44 greyhound tracks around the country have closed, and after this year, only two tracks in West Virginia will remain.

Comparing Casino Revenue

In the meantime, Southland is focusing on hotel construction and expanding its casino, by far the most lucrative in Arkansas with $241 million in revenue from January through November 2021. That includes slot, gaming table and sports book revenue, and was just off the pace Southland set in 2019 — before the COVID-19 pandemic, of $258 million. (See chart below.)

By contrast, Oaklawn’s casino revenue for the first 11 months of 2021 was $133 million, down from $155 million in 2019. Saracen, which began opening in phases in spring 2019, had 11-month casino revenue of $141 million in 2021.

Delaware North of Buffalo, New York, Southland’s owner and one of the largest privately held hospitality and food services companies in the world, would not make a representative available for an interview, nor would it discuss the racing phaseout beyond referring to a 2019 news release.

Owned by the Jacobs family of Buffalo for more than a century, Delaware North owns restaurants, three other casinos and venues like the TD Garden in Boston, home to the Bruins of the National Hockey League. The company had $3.7 billion in 2019 revenue, according to Forbes.

Spokesman Glen A. White did offer an email update on the current business climate and the construction project, which has been heralded by local elected officials as a boon to tourism as Southland proves itself as a regional draw and a fierce competitor for business that once went to the riverside casinos of Tunica, Mississippi.

“Our gaming business is continuing to do well in the face of COVID-19 as Southland operates under Delaware North’s Play It Safe program to help keep guests and employees safe,” White’s email said. “Construction is on track to open Southland’s new casino complex sometime in the spring, with the hotel to follow later in the year.”

2,400 Slots, 60 Tables

The casino will have 2,400 slot machines and up to 60 live table games, White said. The complex will also have expanded dining, “including a larger buffet, larger steakhouse restaurant, new fry house, new coffee shop, new VIP player lounge and new center, lobby and steakhouse bars.” The 300-room hotel will be a gleaming blue glass high-rise with 60-70 suites and 12 penthouse suites.

“Southland is also planning a series of job fairs and multiple dealer schools in the coming months to begin hiring additional employees that will be needed,” White’s email said.

Oaklawn hired close to 400 new workers for its hotel, which has been full many weekends but short of “where we’d like occupancy to be midweek,” said Smith, the general manager. “We’ll continue to work on the strategies around how we do that, but numbers are improving as awareness starts to get traction.”

Smith is also cautiously optimistic about the pandemic since the omicron variant has surged. Although highly transmissible, the mutation has so far caused generally milder illness than other variants.

“It seems to have a 30- to 45-day cycle considering what has been seen in South Africa and other other countries that had this first, so hopefully with vaccination rates and so forth going up we may be able to mitigate the effects. But we’re watching it closely, and we even partnered with the Department of Health to do a vaccine clinic here on one race day in December. That went very well, and we’re excited about maybe even doing more of that.”

Arkansas Casinos by the Numbers
For calendar years