The Week in Review: Hawthorne Proving that Lowering Takeout Works

The handle on Thursday’s nine-race card at Hawthorne was $2,080,655. That may not seem like much, but at Hawthorne, which opened Mar. 5, it was a cause for celebration. It was the fourth time this year that the Chicago-area track had topped the $2-million mark in handle, something that happened just once all of last year. What’s going on? The answer, says Hawthorne Racing Analyst Jim Miller, is that bettors are gravitating towards the track’s 12% takeout in the win, place and show pool, an industry low.

“The lower takeout has had a massive affect on our handle,” he said.

Supposedly, a casino will some day come to Hawthorne, but the project has stalled and there’s no time line for when it will arrive. Until it does, Hawthorne is faced with the sort of obstacles that have buried many a racetrack. There’s no money coming in from a casino, the purses are small and so is the handle, and the quality of racing falls far below what is offered at places like Keeneland and Oaklawn. There’s also the racing calendar. Hawthorne is obligated to conduct harness racing, which leaves room for a Thoroughbred meet of just 69 days.

An obvious game plan would be to merely try to survive until the casino arrives, but the Hawthorne team went into this year’s meet determined to find some fixes to their problems. They came up with a bunch of innovations, none more bold than a huge reduction in the takeout for win, place and show bets. Last year, that number was 17.5%, right around the industry standard. They felt a drop to 12% would help attract interest and drive up the total handle.

Which it has done. Through the first 13 racing programs, the average per-race handle in the win, place and show pools has been $64,254. That’s a 33.72% increase from last year’s figure of $48,051.

No one was surprised to see the handle go up in the straight pools, but what has happened is that handle is up in virtually every pool. It seems that bettors started following Hawthorne because of the low takeout in the straight wagers and have been spreading their money around in all pools.

“We continually focused on the lower takeout and people started to realize that we are giving more back to the bettors and trying to grow interest in the product,” he said. “People started to come over to our product because of the low takeout and what they’ve been doing is also betting in the other pools, the exactas, the multi-race wagers. That’s the reason why you see overall handle up.”

Through the first 13 days of the meet, the average handle has been $1,623,460. Again, not a big number but the average handle for the entire 2022 meet was $1,242,418. Miller said the handle will only grow bigger once Hawthorne starts carding grass races.

The other major change implemented at this meet was to drop Saturday racing. Hawthorne races only on Thursdays and Sundays and will do so until June when the schedule will consist of racing on Wednesdays, Saturdays and Sundays.

“Our schedule, that’s really helped,” Miller said. “There’s just too much competition on Saturdays and we get buried. Our Thursday cards, if we ran them instead on Saturdays, would probably handle $1 million less.”

Can the rest of the industry learn something from the Hawthorne experiment? Miller says that it can. A lower takeout rate means the slices of the pari-mutuel pie are smaller, but Miller said with the bigger handles everyone is coming out ahead.

“Yes, lower takeout could mean a lower return to everybody,” he said. “But what we are seeing is an increase in the handle for exactas, trifectas, Pick 3’s, Pick 4’s. That’s been able to offset the lower takeout from the win, place and show pools. So commissions earned are up. All the partners betting on the Hawthorne signal are making more money. And what is happening is that we are generating more interest in our product and that is benefitting everyone, including the players. I would hope this is something we have started and will see others follow along. You can make more money doing this and increase your exposure. We’re very happy with the results.”

Wishing Jimmy Jerkens Well

The sport has a problem when a Jimmy Jerkens can go so bad that he won just four races last year, admits he was running a money-losing business and had to run off to Saudi Arabia to save his career. Anyone who has followed New York racing since Jerkens went out on his own in 1997 knows that this was a terrific horsemen who was as good as anyone on the New York backstretch.

For years, he backed that up. He won 846 races and 78 graded stakes. He was consistently a player at the top level, winning races like the GI Breeders’ Cup Mile, the GI Metropolitan H., the GI Woodward, the GI Travers, the GI Florida Derby, and the GI Santa Anita H.

He was his father’s son and his father, Hall of Famer, Allen Jerkens, was a genius. He thought that was enough.

“I got entrenched in my father’s era,” he said. “Back then, you could get a reputation of being thorough and doing a good job and you could sit back and the horses would come to you. You did the best you could. It’s a different game now. You have to be proactive, you have to go to sales, you have to be on social media. I was never built like that. I never adapted and I’m paying the price.”

Never a self-promoter, never one to cozy up to wealthy owners, Jerkens may have had substance, but not style and, for that reason, he was no match for the super trainers that began to take over the game. Everyone wanted their horse to be trained by Todd Pletcher or Chad Brown, Steve Asmussen, Brad Cox. And for good reason–they win. So Jerkens stopped getting good horses from the sort of clients that could put him in the winner’s circle. Even one of his most loyal clients, Centennial Stable, found its way to Pletcher. When Centennial’s Litigate (Blame) won the GIII Sam F. Davis S. at Tampa Bay Downs this year, it was for Pletcher and not Jerkens.

Then he got swept up by negative momentum. He won 11 races in 2020, 10 in 2021 and just the four last year. Owners see that and they flee. Once someone starts going bad, it can be impossible to turn things around.

Jerkens is going to work for Prince Faisal bin Khalid Al Saud and said that there’s been talk that the Prince will eventually open up a stable in the U.S. with Jerkens put in charge. Let’s hope he can make it back and with a barn full of good horses. He deserves nothing less.

A Flaw in the Points System?

Last year’s 2-year-old filly champion Wonder Wheel (Into Mischief) did herself no favors this year. Among the bigger disappointments so far in 2023, she finished second as the odds-on favorite in the Suncoast S. and then finished sixth in the GI Ashland S. That left her with 48 Kentucky Oaks points, good enough for only 15th place in a race that is limited to 14.

As it turns out, she will make the Oaks as trainer Chad Brown has decided to pass the race with Shidabhuti (Practical Joke). But should an Eclipse Award and Breeders’ Cup winner have had to sweat things out? Off form or not, she’s a champion and belong in the Oaks. The answer is to make both the GI Breeders’ Cup Juvenile and the GI Breeders’ Cup Juvenile Fillies races where 100 points are allotted to the winners. If you win one of those races you belong in the Oaks and the GI Kentucky Derby.

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