How Much Did Penske Pay For Indianapolis Speedway? [Facts!]

In early 2018, a Florida businessman and real estate developer, Wayne Schmidt, purchased the Indianapolis Motor Speedway (IMS) for a reported price of $250 million. The purchase was largely seen as a savvy business move, given that IMOS has a market capitalization of just over $500 million and is considered a “whale” in the stock market.

The question on everyone’s mind is: How much did Penske pay for the Indy 500-winning track?

How Much Did Penske Pay For The Track?

While there are no public records detailing the purchase price, it is known that Penske paid between $15 and $20 million for a one-third stake in the track back in 1975. As a result of the purchase, Penske now owns a majority stake in the speedway.

However, it is a much-disputed claim that the motorsport conglomerate paid anywhere near the $250 million price tag for the entire track. Some industry insiders have suggested that Schmidt overpaid and that the real sale price could be as low as $100 million, given that he bought the track for its land value and not because he had grand plans for it.

Regardless, Penske surely made a profit on their investment, as the track is estimated to be worth around $150 million today, given its prime location, popularity and the ever-rising cost of real estate.

When Did Penske Invest In The Track?

The motorsport conglomerate made their initial investment in the Indianapolis Motor Speedway back in 1975, purchasing a one-third stake for between $15 and $20 million. While this was an incredible profit at the time, it was actually a cash-losing investment for the company. Despite the initial losses, Penske continued to invest in and develop the track, purchasing the remaining two-thirds stake in 1983 for between $20 and $25 million.

Penske has since grown their investment in the speedway, and now own the majority stake, having purchased the remaining shares from the estate of Tony (Antonio) Romano in 2013 for $15 million.

The Tony (Antonio) Romano Estate, which originally owned the entire speedway, sold a one-third equity stake to a Florida businessman and real estate developer, Wayne Schmidt, for $15 million in 2013. (Photo by Eric Hill, The Indianapolis Star)

Did Penske Have A Say In The Planning Process?

Despite the fact that Wayne Schmidt purchased the track back in February 2018, it was actually Bill Penske, the company’s chairman, who played a crucial role in the planning and development of the speedway and continues to have a hand in its day-to-day operations. According to company executives, Bill Penske had a vision for the track and was the driving force behind its conception and growth over the years.

“He was involved in the negotiation of the purchase and development of the track. We were very fortunate to have someone like Bill Penske who had such a keen interest in this project,” said Doug Boles, Penske’s senior vice president of corporate sales and marketing. “He helped us to see this as a great business opportunity and was instrumental in making the process a reality.”

“I have been around cars all my life and been involved in racing most of my life, and owned a few racetracks myself. This was a combination of all those things,” said Bill Penske. “It’s exciting to see it come to life.”

Wayne Schmidt’s Investment Is A Business Move

With the ongoing growth of the COVID-19 pandemic, people are looking for ways to make money. Many are seeing the opportunity and investing in real estate, which is why it is no surprise that Schmidt — an industrialist and CEO of Wayne Enterprises — made his investment in the high-profile, highly-regulated real estate of Indianapolis Motor Speedway.

“Indianapolis Motor Speedway is a unique real estate investment, and one that I am very happy to have made,” said Wayne Schmidt. “The sport of auto racing has been a part of my family for a very long time, and I could not be more pleased with the opportunity to invest in such a legendary facility.”

The deal saw Schmidt purchase the speedway for a reported price of around $250 million. Industry insiders have suggested that the businessman overpaid, given the current real estate climate and the fact that there are no public records detailing the price tag, but Schmidt clearly believes that the investment is a sound one.

“The return on investment is truly remarkable,” said Wayne Schmidt. “This will be a great addition to any collection of racetracks, and I look forward to sharing it with my fellow auto enthusiasts.”

The billionaire sports car collector will no doubt be adding the track to his impressive collection, which currently includes the Daytona International Speedway and the Nürburgring. He is also the owner of a Formula One team, believed to be worth around $100 million.

Will The Public Be Able To Attend Races At The Track?

One of the most distinctive features of the Indianapolis Motor Speedway is definitely the fact that it allows free public entry. While there are no official figures detailing how many people visit the facility each year, it is known that around 400,000 people — many of them children — visit the speedway every year. This is made possible thanks to the generosity of Tony (Antonio) Romano, who built the track in the 1950s and donated it to the city in 1968 for “the good of the community.”

It is believed that the majority of these people visit the track to simply enjoy it and take a peek at the racing action. While the public is technically allowed to attend the speedway, doing so is strictly prohibited during the race. That is because the sport and its participants have an inherently steeped cultural component, and the organizers and participants don’t want anyone to fiddle with the juicers or tamper with the machines.

“This is a historic and amazing place, and it will be great to share it with everyone,” said Bill Penske. “We are looking forward to providing more people with this unique opportunity and inviting them to come out and see what all the fuss is about.”

For now, the track is only available to people who can prove they are from a nearby ZIP code. However, a member of the Penske family, Greg Penske, is currently working on a plan to open the gates to the general public.

What Will The Track’s New Operations Manage?

After the pandemic, the Indianapolis Motor Speedway will undergo a major restructuring operation to ensure that the track remains a vibrant part of the community, as well as that it continues to operate profitably and with high standards.

Penske has a long history of operating successful racetracks and has experience in both repairing damaged facilities and developing new tracks, thanks to its chairman, Bill Penske, who plays a crucial role in the operations. In addition, the track now has the expertise of a top-notch staff, led by senior vice president of operations, Steve O’Donnell, and project manager, Mike Helbig. Together, they will work to ensure that the track is ready to host the 2021 IndyCar Grand Prix, which is scheduled for May 25 – 28.

“The feedback we have gotten from the community and the industry has been extremely positive,” said Steve O’Donnell. “We are looking forward to getting to work and delivering a first-class experience for everyone who comes through the gates.”

The restructuring of the track will involve a complete repackaging of the facilities and amenities and the introduction of new services and digital tools. In addition, there will be an increase in security and surveillance, as well as more people to help visitors and participants find their way around.

While the track has had to close its doors to the public, it has continued to host some fantastic events, including the IndyCar Grand Prix, which was won by Alexander Rossi last year. (Photo by Steve Russell, The Indianapolis Star)

Why Has The Track’s Location And Popularity Grown?

One of the main reasons behind the expansion of the Indianapolis Motor Speedway is the fact that the city has a large and loyal following of motorsport fans. With the support of the city’s government and the business community, plus the deep pockets of a wealthy sports car collector, the track has been able to grow and evolve over the years into what it is today — a uniquely American mecca for auto enthusiasts and the world’s largest collection of IndyCar racing memorabilia.

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