00:00David was going through some of the numbers that I know we already have at least through the first
00:03few days of this. It looks like it's already a bigger sale this year than last. It is. We've
00:09been so pleased with the numbers. David is exactly right. It is the largest horse sale in all of the
00:15world. And we increased our record by 24 percent last year. And then this year we're up another
00:22three to four percent where we'll be north of 550 million. So the numbers are pretty staggering and
00:28we're excited about those and just excited about people's interest and passion for this great sport.
00:34I mean, when we talk about, you know, the increase in sales, both in terms of in terms of the
00:39pricing
00:39here, give me a sense as to kind of what is this mostly kind of existing owners coming back to
00:45the
00:45table? Are you seeing new entrants into the market right now? What's kind of the mix? Both. We
00:52definitely see both. And our team travels actually all over the world to try to be sure that we have
00:56the best buying bench to create the best market that we possibly can. We have participants from
01:02over 30 countries involved as buyers and from all over the United States. And one of the best
01:09aspects of this sale to me has been that we've sold 70 horses for a million or more to 57
01:18different
01:19distinct owners. And that's an incredible number for us because it just shows the health and the depth
01:25of the market. So people really come from all over. Yeah. Well, I mean, do you have a sense here?
01:29I
01:29mean, I mean, I think this you wrap up this weekend. I mean, do you have any sense of what
01:32that final
01:33gross number is going to look like? It'll be about 552 million this year. And I think it's important
01:39to emphasize, too. Yes, we do have a lot of wealthy owners who are involved in the sport, but we
01:43also have
01:44a lot of people who aren't as wealthy and they make their living in the horse business. You know, it
01:50doesn't
01:50take a three million dollar colt to necessarily be successful. Napoleon Solo, who won the Preakness
01:56this year, was purchased for $40,000. So there is some value throughout the catalog. And I think what
02:02drives people's passion for this at the end of the day is the horse. The horse is such an incredible
02:09animal, so majestic. It's attributed to Winston Churchill, who said there's something about the
02:14outside of a horse that's good for the inside of a man. And I think particularly in these times when
02:19there does seem to be a lot of conflict in the world, this is a place that people come together
02:24and can really have great experiences with their family and their friends and an incredible day at
02:28the track. But I am curious, though, too, just about kind of just a little bit of the bifurcation
02:33that we're seeing, actually, with regards to the sales. I mean, you mentioned all of the million dollar
02:37sales that you had this year, but then I saw the buyback rate is also going up as well. So
02:42give me a
02:42sense as to sort of what that says about the state of the market and sort of going forward of
02:47who that
02:47buyer ends up being. Sure. We look really closely at the buyback rate. And the first book, it was up
02:52a little bit. Actually, at the end of the sale, it'll end up being about what it was last year,
02:57which is about 15 percent. And it can mean anything. It can mean that the seller, it's an auction. So
03:02it's whatever price the buyer's willing to pay and the seller's willing to sell. And sometimes the
03:07seller might say that he's going to hold on to the horse and sell the horse as a two-year
03:10-old or hold
03:11onto the horse and race the horse. So it's not always an indication of weakness in the market.
03:19It can sometimes be just the seller valuing his horse differently. With regards to the supply
03:25coming into the market here, there was some recent data out by the Jockey Club actually projecting that
03:30the number of registered thoroughbred foal coming in, at least in North America, that was going to be
03:36down significantly this year. I think what something almost by half of what it was from that 38,000 peak
03:42that we saw back in the day. That's right. And supply and demand definitely does drive some of these
03:48numbers. We're watching that closely as well. But the truth is our sale, our September sale, the numbers
03:53haven't changed very much. So even as the annual full crop nationally has gone down, the horses that are
04:01bred commercially to be brought to market has stayed fairly consistent. So when we talk about
04:05I guess what people are looking for here, I mean, David Papadopoulos was getting at the idea that
04:10obviously some people are looking to put these horses on the track. Some people, at least in terms
04:15of trying to get a return on that million or million plus that they might be spending, are maybe going
04:19to be looking obviously towards the post-race career as a stallion. What's the general mix of people
04:26in terms of what they're looking for to get back out of it? You know, one of the most interesting
04:31things
04:31about this industry that I've observed in my lifetime is that there are people involved at
04:36every level and looking at different types of investments. You have people that are looking for
04:41colts at this yearling sale. Our highest price this year was 3.7 million. And certainly the buyers of
04:46that are looking hopefully to have a stallion prospect at the end of the day, which does become
04:51very lucrative. But then you have lots of people who are buying fillies and then they hope to have
04:55residual value in the mare after her racing career. And she becomes kind of an annuity if you get a
05:01nice mare who every year is producing a foal that you sell either at our November breeding stock sale
05:07or our September yearling sale. Shannon, before I let you go, I do just have to ask you about
05:11Castleton and the auction on that. I know that's coming up at the end of next month in October,
05:17but I'm just curious as to what it actually says. I mean, to be auctioning off real estate like that,
05:22obviously prime real estate. Is this an expansion of the Keeneland business or is this just sort of
05:28a one off? We'll see. This is a partnership that we're doing with Sotheby's and they're handling the
05:33real estate portion of it. And we're handling the auction portion of it on the evening of the sale.
05:38And we're really excited about it. That farm is incredibly historic. It's only had six owners
05:44since it was founded in the late 1700s. So it's going to be a really exciting event. And Sotheby's
05:51has been great to work with.
