Minneapolis-St. Paul Hospitality Market Report
Construction Moderation to Aid Metrics as Bloomington
Hotels Lead the Metro’s Recovery
Multiyear supply surge eases. Minneapolis experienced a rapid increase to both supply and demand in the years leading up to the pandemic, resulting from one-time events like the Super Bowl LII in 2018 and the 2019 March Madness Final Four. As a result, the drop- off in demand following the health crisis was particularly impactful on hospitality metrics. The 8.5 percent increase in supply from 2018 through 2020 has enhanced competition among hotels and prevented fundamentals from reaching pre-pandemic levels thus far, especially in the Minneapolis CBD. Metrowide KPIs began climbing this spring, with May ADR and occupancy at their highest levels since the onset of COVID-19. By year-end, annual RevPAR will be in-line with levels from a decade ago, but will still trail 2018 and 2019 levels.