Minneapolis-St. Paul Hospitality Market Report

Conventions and business migrations reshape CBD dynamics. Corporate relocations and limited convention activity continue to weigh heavily on the Minneapolis central business district. Since 2020, the metro’s average annual occupancy rate has remained the lowest among major U.S. hospitality markets, while the CBD measure has trailed all other major urban cores since 2021. As of June, the average annual occupancy rate was 54.2 percent. This decline was driven primarily by corporate exits to suburban areas, including firms such as AT&T, Target and Blue Cross Blue Shield. As these offices relocated, hotel bookings tied to meetings and interviews with out-of-market personnel have decreased. While convention center attendance lags behind pre-pandemic levels, revenues increased by more than 20 percent in 2023. The planned $13 million remodel and the addition of 100-plus events this year may help boost hotel occupancy in the Minneapolis CBD, though it is still expected to remain over 1,500 basis points below pre-pandemic levels in 2024.