Intensity Fuels Rising Market - By Eric Mitchell

 (Originally published in the September 24, 2011 issue of The Blood-Horse magazine. Feel free to share your own thoughts and opinions at the bottom of the column.

By Eric Mitchell - @EJMitchellKy on Twitter

By Eric Mitchell Competitive people get involved with Thoroughbreds. Owners time after time describe a shared nervousness leading up to a race and the tremendous elation of seeing their horse cross the wire first.

The same energy and competitive spirit can be felt in the auction pavilion, too. Particularly when an auction is going as well as the Keeneland September yearling sale. As in any sale, there are lulls, and the auditorium and sales ring are filled with a unified hum of conversation and the chatter of the auctioneer, as horses flow in and out of the ring.

I’m at $50,000 n I wan 60, 60, bid on 60, I’m at 50 would you go 60…nice filly in the ring here, don’t let her get away...

Then there is that unmistakable, crystallizing moment when the crowd collectively becomes aware that two serious buyers have hooked up. Conversation almost stops, and all eyes are locked on the ring or on the nearest TV monitor.

I’m at $500,000 n I wan 6, how about 6, we have 6, now 7, now 8, now 9. One million, you’ve come so far, don’t lose him now.

One of those moments hit the afternoon of Sept. 15, deep enough into the sale that seven-figure horses are rare. And, yet, here we were with a robust bay colt by Awesome Again in the ring and more than $1 million on the board. Owner George Bolton, who races multiple graded stakes winner The Factor in partnership with Fog City Stable, was in the mix, standing in a doorway in the back of the Keeneland pavilion with bloodstock agent John Moynihan and Stonestreet owner Barbara Banke, widow of Jess Jackson.

“This is the best horse, right here,” Moynihan told Bolton, who was stretching the bounds of what he was willing to spend. The grand colt out of Legs Lawlor, a daughter of stakes winner Evil Elaine and a half sister to 1997 Horse of the Year and juvenile champion Favorite Trick, circled the ring.

Bolton went to $1.2 million, but the price rose immediately to $1.25 million.

So many decisions to be weighed and only seconds to weigh them. The trio compared notes, then looked across the pavilion at the horse in the ring again.

“I’m telling you, it’s the best horse,” Moynihan said.

“The margin is getting really thin right now,” Bolton replied. He looked from Moynihan back to the colt and gave a signal to the bid-spotter, going to $1.3 million. Would that do it? Would that be enough to land this promising colt?

Not this time, as Mark Roberts, bidding on behalf of Frank Stronach, quickly raised the bid to $1.35 million.

Bolton was done. The price was much higher than he anticipated having to pay so he walked away from the door.

As it turns out, Stronach—the owner of Adena Springs, which bred, raced, and stands Awesome Again—really wanted this colt and was apparently set on getting him. Roberts is the general manager of Adena Springs South in Central Florida. His assessment of the colt mirrored Moynihan’s. “I thought he was probably the nicest horse I have seen at this sale,” Roberts said. “I thought he was beautiful. For the sire, I thought he was very elegant.”

Bolton said later he was more than happy with the yearlings he’s purchased so far this year, including a $1.2 million Street Cry colt out of Forest Music he bought on the opening night of the Keeneland September sale.

Six horses worth $1 million and up were sold during the first half of the 13-day auction, but that is only part of the story with this sale. The demand throughout has been exceptionally deep.

One way to assess the market’s depth is by knocking out the best and worst prices. After all, we know what a few million-dollar horses and some exceptionally low sales can do to an average. When we recalculated the gross, average, and median after taking out the top 10 highest prices and the 10 lowest prices for the first seven sessions of this year and 2010, we found gross sales up 20.7%, the average up 11.4%, and the median up 25%.

These are the kinds of percentages the industry has been yearning to see since 2008. The bottom of the commercial market now seems to be behind us, and the future ahead looks brighter thanks to the intense competitive drive of horsemen looking for that next big horse.

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