By Community Guest Writer N. A.

The Fairgrounds markets itself as a “one-of-a-kind multi-use entertainment venue designed to benefit the community.”  The developers promise to only race six days annually, less than 5% of the year.  The rest of the time, it’s a venue for concerts, food truck festivals, and farmers markets. It’s a salve for the town’s economic woes and the residents’ boredom.  It’s a landfill and traffic management plan.  It’s a one-of-a-kind sports bar and restaurant. It’s a horse park and an equine therapy center.  

All this sounds lovely, but it’s not what The Fairgrounds is as a business. The investors of the Fairgrounds don’t care about redeveloping the landfill, building a racetrack, revitalizing Leominster, or Massachusetts agriculture.  They’re investing in The Fairgrounds to build an app.

The Fairgrounds needs to secure a Category 2 sports wagering license from the Massachusetts Gaming Commission to conduct live horse racing.  This requires investing at least $7.5 million into capital development (such as building a road off the Leominster Connector, for example, or levelling the landfill) within three years of issuance of the license.  Meanwhile, this license would also allow The Fairgrounds to establish an online sports wagering platform.

Mobile wagering in Massachusetts yielded $690 million in 2024, up 40% from the previous year.  Mobile wagering companies like DraftKings are authorized to operate in Massachusetts with Category 3 licenses.  Only seven licenses are available in the Commonwealth for online-only operators; and these are awarded through a competitive bidding process that is expected to grow increasingly more difficult.  Online wagering operators can opt out of this expensive bidding cycle by establishing a partnership with a brick-and-mortar gambling location, a process called tethering.  The retail operators gain access to mobile wagering revenue, while the online operator gets a bit more stability, credibility, and the capture of a particular geographic market.

In Massachusetts, slot parlors and casinos are required to invest $125 and $500 million at a minimum in capital development before opening.  Tethering was developed to protect these investments from obsolescence caused by online sports wagering legalization.  For new developers, however, tethering represents an extraordinarily lucrative means of securing mobile wagering revenue for the minimal $7.5 million investment required for a Category 2 license. 

Obsolescence is the point for The Fairgrounds.  The thoroughbred industry in Massachusetts is not coming back: only four foals were born last year, and there are only five stallions in the state.  The Fairgrounds has stated that they lose money whenever races are actually held, and thus they intend to hold as few races as legally permissible, forever.  The track is supposed to be empty.

Their retail business (their restaurant, bar, and revenue from their physical sportsbook; ie, race wagering and simulcasting) is intended to be completely subsidized by mobile wagering.  In their economic impact report, The Fairgrounds estimates that their retail business would produce only $7.4 million annually. While they haven’t explicitly stated how much revenue they expect from mobile wagering, they have promised that Leominster would receive 0.5% of this revenue, amounting to $100,000 at a minimum and making the total share $20 million. This value would represent 73% of The Fairgrounds’ total revenue.  In Gardner, BayState Racing projected that mobile wagering would represent 86-91% of their revenue.  Applying those rates to the estimated retail revenue reported by The Fairgrounds yields $54-82 million in annual mobile wagering revenue, an extraordinary return on a $7.5 million investment.

The Fairgrounds is certainly “one-of-a-kind,” but it is not intended as a multi-use entertainment venue.  The Fairgrounds is intended as the cheapest means of stably securing sports wagering revenue in all of Massachusetts: an empty track that props up FanDuel, DraftKings, or Bally Bet. The Fairgrounds aspires to be a parasite.