The annual Magic Millions thoroughbred sales which is taking place this week on the Gold Coast traditionally gives a glimpse of the expectations of Australia’s Rich Listers for the year ahead.
Low prices means Australia’s billionaires are feeling cautious, and in 2011 the average sale price at Magic Millions was down about 6%, while across the year the wealth of the top 20 members of the Australian Rich List was down about 11%.
Last year the average sale price rose 2.8% on the 2011 sale but, apart from Gina Rinehart, the fortunes of the Rich List continued to falter with most list veterans having a difficult year, with 104 losing money.
The list even suffered the indignity of having to drop the cut off for eligibility by $5 million to $210 million.
However, things are looking up at the Magic Millions this year. In the first day of the yearling sale prices averaged $128,685 and the clearance rate hit 77%.
Yesterday there was the first million dollar yearling sold for Coolmore Stud, with Tom Magnier successfully bidding $1.35 million.
The sale of the sire pushed Thursday’s gross sales above $36 million, an increase of about $3 million on last year’s gross sales figures.
Already in the first two days the Magic Millions has grossed about $50 million in sales which will be music to the ears of Magic Millions owner, retail billionaire Gerry Harvey.
Harvey is also one of the biggest vendors at the Magic Millions, selling more than 13 horses on the first day of the sale alone.
“The first day has provided confirmation that there’s finally reason to celebrate – we have hit rock bottom over the past few years, and we’ve now come out the other end,” he told The Australian Financial Review.
Other big names around the sales ring included John Singleton and racing royalty Bart Cummings, Lee Freedman and the Waterhouse family.
This year they were joined by genuine royalty with the employment of the Queen’s granddaughter and Olympic equestrian Zara Phillips as the face of the carnival.
The one former billionaire notably absent from the buying action was Nathan Tinkler, which was in stark contrast to 2011 when his thoroughbred operation Patinack Farm was one of the major buyers at the sale, snapping up 22 horses for $2.98 million. Instead, this year finds Patinack Farm trying to sell up to 11 horses, which, according to reports so far, have only attracted a limited amount of buyer interest.
With the exception of the beleaguered Tinkler, the optimism in the air at Magic Millions suggests a better year for Australia’s Rich List.
Cara Waters is a former SmartCompany editor. Previously, Cara was a senior reporter for the Financial Times’ website and worked for The Sunday Times in London.
