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Sunday, May 23, 1999 By Torsten Ove, Post-Gazette Staff Writer
Down at the Hotel Morgan in the heart of Morgantown, W. Va., there's simply no doubt about R. Ted Brant and his brother, Bob, who want to build the first enclosed racetrack in the world at Pittsburgh International Airport.
"If you want my opinion, Pittsburgh is very lucky that [Ted's] interested in building this track," said Mark Skidmore, who books banquets at the landmark High Street hotel that Ted Brant owns. He paid $1.3 million for the building, which is now undergoing a $2 million face lift.
"He'll keep his word," Skidmore said of his boss. "If he said he'll do something, he'll do it."
Brant, 52, president of Morgantown-based Brant Motorsports Inc., and Bob, 46, who handles the marketing for the company, are convinced that they can attract enough investors to build the $300 million Brant Pittsburgh Auto Racing Complex.
The track, the size of six football fields, would seat up to 125,000 people under a metal roof in what the Brants say is an underserved market, drawing racing fans from Pennsylvania, Ohio and West Virginia. The track is being designed by the Austin Co. of Cleveland and Robbie/Young & Wright Architects Inc. of Toronto, the designer of the Toronto Skydome.
"I'm highly confident that this project is going to be built," said Ted Brant, a soft-spoken bear of a man who lives in Short Gap, W.Va., a village in the Eastern Panhandle of the state where he grew up. "There is always some skepticism on a project of this magnitude. But if it's a good idea, I'm confident the lenders and investors are going to be there. By no means do I mean to imply that this is easy. It's still a business first and it needs a good economic basis. And this has a good economic basis."
The track would be built on land owned by Allegheny County, which has given the Brants a year to come up with the money. Cash could come from bank loans, private equity, naming rights, luxury boxes and sponsorships. Naming rights alone might bring in as much as $35 million, which is what Lowe's, the home-improvement retail chain, paid to name the NASCAR speedway near Charlotte.
Brant Motorsports, backed by Aero Services International, an aviation company run by Ted Brant, owns a rookie racing team in the Pep Boys Indy Racing League and already has sunk about $1 million into the Pittsburgh project.
Yet the Brants won't name any of the potential investors whom they've spoken to and concede that they have no firm commitments from anyone.
"We will make an announcement when we have the financing in place," said Bob Brant, the former regional manager for Circuit City in the Boston area. "I understand that people are skeptical. I would be, too. But we have already invested a lot of time and money in this project. By fall we hope to make the announcement."
Just who are these guys?
Although they're identified with Morgantown because they have an office at the municipal airport and Ted owns the biggest hotel in town, their racing company is incorporated in Delaware, their aviation headquarters is based in Pennsylvania and they have business experience throughout the Midwest and eastern United States.
They also have a lifelong love of auto racing that developed into a financial investment about five years ago after Ted Brant befriended NASCAR team owner Richard Childress in North Carolina. The friendship led to Brant's associate sponsorship of Childress's Winston Cup team, which featured drivers Dale Earnhardt and Michael Skinner.
This year, the Brants have entered competitive racing with their own Indy Car team, which was trying to qualify this weekend for the Indianapolis 500 on Memorial Day.
The sleek black car, with driver Raul Boesel behind the wheel, sports a big decal advertising Aero Services International.
R. (Richard) Ted Brant is the chairman and CEO of the company, a publicly traded aviation firm based in Newtown, Pa., that sells fuel and provides ground support for corporate jets at airports in Harrisburg, Morgantown and, until recently, Chicago. In industry parlance, the business is defined as a "fixed-base operation," or FBO, of which there are about 4,000 operating at airports across the country.
People who know the Brants, both in the aviation and auto racing businesses, don't question the brothers' ability to close the racetrack deal.
"I think they certainly have the capability of putting it together," said Bill Patterson, executive vice president of Richard Childress Racing Enterprises in Welcome, N.C., which is not an investor. "The concept of an enclosed track is of interest to everyone in racing. It's been talked about in the past, but it's never gotten this far before."
Jay Hamby, general manager of Atlantic Aviation Flight Support Inc., which on March 11 bought Aero Services' operation at Chicago's Midway Airport for $17 million, said the Brants are astute businessmen tapping into the national passion for motor sports at the right time.
"I think it's a creative idea, it's very ambitious," he said. "When you think about all the TV revenue and all the sponsorship fees and advertising fees, and these [events] get rained out and it's a loss. There is no climate-controlled racetrack out there. I think it's a great idea."
The Brants were raised in Short Gap, an unincorporated town of perhaps 500 in Mineral County, not far from Cumberland, Md.
Ted, a graduate of the West Virginia University school of engineering and a licensed pilot, still lives in Short Gap with his wife, and his son attends medical school at WVU. The Brants' parents live next door and their two sisters are nearby.
Bob is the only sibling to have left the state, having spent 15 years as a regional manager for Circuit City in the Boston area. Also a graduate of WVU, he lives with his wife at Greystone-on-the-Cheat, a ritzy golf course development overlooking Cheat Lake near Morgantown. The couple has two children, a son in high school and a daughter attending WVU.
Ted Brant began his career in the 1970s as an engineer at Corning Glassworks in Blacksburg, Va., and in the mid-1980s he and some financial partners got into the FBO industry at a municipal airport in Virginia. Brant and his partners bought the Virginia company, Valley Air Services, in 1988 and began building their aviation business.
In 1992, Brant and his partners bought Piedmont Aviation Services for $36 million. Two years later Brant set up Transtech Holdings Inc. and borrowed money from Exxon to buy Aero Services, which was more than $15 million in debt.
The partners raised cash by selling FBOs in Arizona, Virginia, Michigan and Ohio and a leasing operation in New Orleans. They then concentrated on new operations in Morgantown, where Brant already owned Mountain State Air Services, and in Harrisburg.
Last year, Brant sold Piedmont for between $58 million and $60 million. The bulk of his money is held in Transtech which, he said, is worth between $12 million and $15 million.
In recent years, the Brants have been investing heavily in the racing business. Ted started Brant Motorsports two years ago to promote an Indy team and brought in Bob to run the marketing. Aero's board of directors has since approved a $2 million line of credit for Brant Motorsports.
Yet Securities and Exchange Commission filings indicate that Aero has been losing money for years and its stock is worth little. A 1998 audit said the company has "suffered recurring losses from operations and has significant deficiencies in working capital and equity. These matters raise substantial doubt about its ability to continue as a going concern."
Brant said the Morgantown business had lost money and the Harrisburg FBO initially operated in the red but has begun to turn a profit. The Chicago enterprise has been the big success. After Aero sold it, the company paid off debt and sunk $10 million into "developmental reserves" for the racing venture.
Aero is still $18 million in debt, but Brant said that number is deceiving because the money is owed to Transtech -- which Brant and a partner control.
As for the company's operating losses, the latest annual report said Aero has $34 million of "net operating loss carryforward" that could be used to generate cash.
A tax loss carryforward allows companies to carry losses from previous years and apply them against future earnings. The result is a reduction in tax liability. Because of those tax benefits, Brant said Aero's carryfoward should be attractive to potential investors in the company.
Those who know the Brants say their business smarts are matched by their sincerity.
"I've found them to be 100 percent above-board," said Patterson, whose company first dealt with Ted Brant at the airport in Winston-Salem, where Brant ran an FBO and Childress Racing stored its corporate planes.
In Morgantown, the Brants are equally well-respected.
David Bott, the assistant director of the Morgantown Municipal Airport, where Aero Services was busy refueling two Marine helicopters last week, said he trusts Ted Brant's word. "He's not going to waste his time if he can't make it work. Obviously, anytime you're talking about building a project of that size, there's always a possibility for it to fall through. But they're heads-up people. I don't think they would have made that announcement if they didn't think they had the investors."
The Brants don't seem remotely concerned that the project could fall through.
"It's a major undertaking. It's four times bigger than anything I've ever gotten into before," Ted Brant said. "But the economics are based on our previous business experience. The thing we have to do is make sure we have the right [finance] team. So far, it appears that we will be able to do it."
On the Brant Motorsports Web site, the company is already taking orders for tickets. Between 20 and 50 requests come in every day, most of them from people in West Virginia and Pennsylvania, but a few have come in from as far away as Phoenix and New Hampshire.
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