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Market Report

Mid South Hospitality Investment Forecast

2022 Outlook

Summertime Demand Returns to Historical Norms
As Buyers Favor Defensive Plans

Renowned locales set new benchmarks for visitorship. Last summer marked a pivotal point in the Mid-South’s hospitality recovery. During July, occupancy in Tennessee and Kentucky exceeded or matched the level of hotel demand recorded during the same period in 2019, pushing monthly ADR to $134 and $102 per room, respectively. Heightened patronage at prominent tourist destinations was partially responsible for returning seasonal hotel metrics to pre-pandemic conditions. Specifically, Great Smoky Mountains National Park recorded its busiest year to date, logging more than 14.1 million visitors, while distilleries along Kentucky’s Bourbon Trail conducted more than 1.5 million tours. The attractiveness of these destinations and an expected rise in business and music-related events in major metros including Nashville and Memphis have the region positioned for another year of increased tourism and improved hotel fundamentals. Developers are bullish on future demand, namely in Tennessee, where the number of rooms underway ranks sixth among states nationally. This supply, however, is largely concentrated in Nashville.
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