Hawthorne Files Chapter 11 After Failed Racino Bet Drains 135-Year-Old Track

Hawthorne Race Course, a 135-year-old track, is now in bankruptcy after a casino project it could not fund put pressure on the business. The track filed for Chapter 11, with assets of $50–100 million and liabilities up to $500 million, with Fanatics, the largest creditor, owed $8.75 million.

Hawthorne tore down part of its grandstand after getting preliminary racino approval in 2019. The financing never materialized. What pushed things over the edge was a $1.5 million Churchill Downs judgment that froze Hawthorne’s bank accounts. Purse checks bounced twice, horsemen wouldn’t race, simulcast partners cut their feeds, and monthly wagering deposits collapsed from $5 million to under $1 million.

Fanatics moved its Illinois mobile sportsbook to Argosy Casino Alton in January, removing a key partner from Hawthorne’s setup. In court, CEO Tim Carey said there is buyer interest and that simulcasting alone could bring in about $4 million a month.

Operators with racetrack-linked licences should see this as a warning about tying casino development to already thin racing operations. If the build is delayed or financing falls through, the whole model can break quickly as cash flow tightens and partners step away. Suppliers owed money should watch the 363 sale closely, as it will set the real value of the licence and assets, and determine recovery levels based on how the buyer structures the deal.

TGJ Take

Hawthorne did not fail because racing stopped working. It failed because management relied on a casino project that it could not fund and weakened the core business while trying to build it. When the funding stopped, cash flow dropped, payments were missed, and partners left. The 363 sale will show what the licence and location are really worth, and if a new owner can rebuild the business on a more stable base.