McCombs brings savvy, cash to Austin F1 ef­fort

Bil­lion­aire re­vealed as a lead in­vestor in track project; de­sign 75% done

Austin American-Statesman - - FRONT PAGE - By John Ma­her and Shonda No­vak AMER­I­CAN-STATES­MAN STAFF

The Fab­u­lous Thun­der­birds’ clas­sic “Tuff Enough” had just fin­ished blar­ing over the sound sys­tem in a ball­room at the AT&T Ex­ec­u­tive Ed­u­ca­tion and Con­fer­ence Cen­ter on the Uni­ver­sity of Texas cam­pus when Red McCombs was in­tro­duced as the key in­vestor in the ef­fort to bring For­mula One rac­ing and the U.S. Grand Prix to Austin by 2012.

The bil­lion­aire San An­to­nio busi­ness­man has been an owner of the San An­to­nio Spurs and Min­nesota Vik­ings sports fran­chises and is one of UT’s biggest bene­fac­tors. The an­nounce­ment that he is help­ing bankroll the F1 ven­ture lent more cre­dence to pro­moter Tavo Hell­mund’s am­bi­tious ven­ture and drew sev­eral UT of­fi­cials, in­clud­ing men’s ath­letic di­rec­tor DeLoss Dodds.

Dodds, who stood at the back of the crowded room, called McCombs “one of the giants of the Texas busi­ness world. … We have seen the re­sults of his busi­ness acu­men and in­no­va­tive think­ing, so we would have to be­lieve any ven­ture in which he is in­volved holds great prom­ise.”

Since the project was an­nounced in late May, it has met with some skep­ti­cism lo­cally and around the rac­ing world. The track is slated to be built on about 900 acres of un­de­vel­oped land near El­roy in south­east­ern Travis County.

Joe Giesel­man, ex­ec­u­tive man­ager

‘Re­mem­ber, you’re talk­ing about do­ing this in Texas. We have a rep­u­ta­tion as a state and a peo­ple.’

Red MccoMbs, in­vestor in Austin’s For­mula One en­ter­prise

of Travis County Trans­porta­tion and Nat­u­ral Re­sources, said Tues­day that it nor­mally takes at least six months for a com­plex devel­op­ment such as this one to un­dergo city and county re­view. Giesel­man said the county’s re­view would in­volve roads, traf­fic, drainage, flood plain is­sues and on-site waste­water, if any.

Be­cause the site is likely to con­nect to a state high­way, FM 812, the Texas Depart­ment of Trans­porta­tion also will have a role in the re­view. Giesel­man said that the area’s two-lane ru­ral roads would be in­ad­e­quate to serve a 200,000per­son event and that the de­vel­oper would prob­a­bly have to en­hance the road sys­tem.

Those are some of the el­e­ments that put the project on a tight sched­ule for a 2012 race. McCombs, how­ever, said, “I wouldn’t even have made an an­nounce­ment if I wasn’t very op­ti­mistic that this will be com­pleted and done.”

McCombs said that shortly be­fore the news con­fer­ence, he talked on the phone with F1 boss Bernie Ec­cle­stone and re­as­sured him that things would be done on time.

“Re­mem­ber, you’re talk­ing about do­ing this in Texas,” McCombs said. “We have a rep­u­ta­tion as a state and a peo­ple.”

Hell­mund’s as­so­ci­a­tion with McCombs goes back a long way. Hell­mund said when he started his rac­ing ca­reer 21 years ago, his first spon­sor was a deal­er­ship owned by McCombs. Al­though McCombs has been in the car busi­ness since 1950, “I had no idea of the scope of For­mula One,” he said.

For­mula One is the most pop­u­lar form of rac­ing world­wide — and the most ex­pen­sive. The TV au­di­ence for a race can top 500 mil­lion, and build­ing a cir­cuit can run up­ward of $200 mil­lion. State Comptroller Su­san Combs said Tues­day that state funds would not be used to build the track; that would be han­dled by the pri­vate in­vestors. The state has com­mit­ted $25 mil­lion a year in tax rev­enue to the en­ter­prise.

Combs said, “Red is a guy that does well be­cause he’s smart and does his re­search.”

UT’s pres­ti­gious busi­ness school bears McCombs’ name, and he was also a fundraiser for the AT&T cen­ter.

In ad­di­tion to McCombs Part­ners, the other lead in­vestor is Prophet Cap­i­tal Man­age­ment, an Austin-based pri­vate in­vest­ment com­pany, whose man­ag­ing part­ner is Bobby Ep­stein, an owner of Wan­der­ing Creek. At 647 acres, Wan­der­ing Creek is the largest of the parcels be­ing as­sem­bled for the track site.

Other in­vestors in­clude Kevin Sch­wantz, the 1993 500cc world cham­pion mo­tor­cy­cle racer, who is a long­time friend of Hell­mund’s.

Hell­mund said McCombs and Ep­stein had been talk­ing for at least six months about the project, but it was just two months ago that he and Prophet de­cided that McCombs “would be the best strate­gic part­ner/in­vestor to add to a project of this mag­ni­tude in the state of Texas.”

Both McCombs and Hell­mund said the Grand Prix site — which McCombs would like to call Speed City — would be much more than a race­track and could be used for re­search and devel­op­ment by UT, Texas A&M Uni­ver­sity and other schools. How­ever, no specifics of such a col­lab­o­ra­tion were re­vealed.

Hell­mund said the de­sign for the track is about 75 per­cent com­plete, and “we’re mov­ing for­ward as if it’s the site.” Other tracts, how­ever, are still be­ing ex­plored.

“There have been sev­eral re­ally in­ter­est­ing al­ter­na­tive lo­ca­tions pre­sented to us over the last two months,” Hell­mund said. “Not only are they in­ter­est­ing, but they come with en­tic­ing in­cen­tives. We’d be fool­ish as busi­ness­peo­ple not to take a close look at the other op­tions.”

McCombs said the in­vest­ment group still needs to raise cap­i­tal. “We still have many chal­lenges. We have to wade through them and get to the fin­ish line.”

Al­though Austin has the U.S. Grand Prix, other cities ap­par­ently haven’t given up hope of land­ing an F1 race.

“There are three very, very se­ri­ous and sep­a­rate projects,” Ron Den­nis, the head of For­mula One’s McLaren Au­to­mo­tive, told re­porters Satur­day at a NASCAR race at In­di­anapo­lis. Last week, Mon­ti­cello Mo­tor Club Pres­i­dent Ari Straus said that the up­scale New York driv­ing club was still in ne­go­ti­a­tions with For­mula One. A group in New Jersey is also at­tempt­ing to at­tract a race.

Sim­i­lar to the Johnny Cash song “I’ve Been Ev­ery­where,” which played be­fore the brief­ing, For­mula One has been all over the U.S., in­clud­ing Se­bring, Fla.; River­side and Long Beach, Calif.; Watkins Glen, N.Y.; Las Ve­gas, Detroit, Dal­las and Phoenix.

The U.S. Grand Prix was held from 2000 to 2007 at the In­di­anapo­lis Mo­tor Speedway, with the For­mula One cir­cuit in­cor­po­rat­ing the track used for the In­di­anapo­lis 500, an IndyCar race.

“That would be like us try­ing to place base­ball at DKR (Me­mo­rial Sta­dium),” Hell­mund said. Hell­mund said that when the U.S. Grand Prix was held on a cir­cuit specif­i­cally de­signed for For­mula One rac­ing — as Austin’s would be — it was suc­cess­ful.

Combs has said the fi­nan­cial im­pact of the Grand Prix race for Texas would be $300 mil­lion an­nu­ally. McCombs was asked what he thought the fi­nan­cial im­pact would be on him.

“I think it will be im­mense,” he joked.

Jay Jan­ner

San An­to­nio busi­ness­man Red McCombs, right, said Tues­day that he’s op­ti­mistic about the suc­cess of Austin’s For­mula One track. Pro­moter Tavo Hell­mund, left, who landed the deal to bring the U.S. Grand Prix race to Austin, and McCombs spoke to a full house at the AT&T Ex­ec­u­tive Ed­u­ca­tion and Con­fer­ence Cen­ter.

Jay Jan­ner pho­tos

Look­ing over some plans be­fore Tues­day’s brief­ing are, from left, Texas Comptroller Su­san Combs, for­mer mo­tor­cy­cle racer Kevin Sch­wantz and Chris­tian Epp of track de­sign com­pany Tilke GmbH.

Red McCombs, 82, owns an au­to­mo­tive group and has in­vest­ments in a va­ri­ety of in­dus­tries – now in­clud­ing F rac­ing.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.