The Metropolitan Airports Commission has sold about 3 acres of vacant land near the Mall of America for the development of a 151-room Hyatt House hotel.
The MAC sold four parcels that it owns along Old Shakopee Road, in Bloomington’s South Loop district southeast of the mall, for a little more than $1 million to Iowa-based Hawkeye Hotels and its Twin Cities partner JR Hospitality. According to an electronic certificate of real estate value, the sale closed this month.
The group also purchased for $1.3 million a 1.6-acre piece of land south of the parcels that was owned by SkyWater Technology Foundry.
The hotel would be Minnesota’s first Hyatt House, a residential-style, extended-stay hotel.
“The biggest thing is the proximity to the Mall of America, the proximity to [Minneapolis-St. Paul International Airport], the growth of development happening near the Mall of America,” said Jay Bhakta, a managing partner for JR Hospitality, on Wednesday. “There really aren’t too many new upscale, extended products there to begin with, and the ones that are there are fairly old.”
The timeline is still being finalized, but construction could begin as early as December or it could be in the spring, depending on the weather, Bhakta said. The hotel would likely open in spring 2020.
There had been discussions about another hotel that would service airline crews at the location, but that deal fell through, Bhakta said.
The MAC is working to sell other small parcels in the area, where any development would have to meet height restrictions because of proximity to the airport, said MAC spokesman Patrick Hogan.
JR Hospitality and Hawkeye Hotels have partnered on about a dozen Twin Cities hotel projects.
A few days ago, the group closed on the purchase of a site in the Hennepin Avenue theater district in downtown Minneapolis, where they plan to build a Cambria Hotel and Fairfield Inn & Suites side by side, Bhakta said.
Cushman & Wakefield said about 7,200 rooms were in some stage of planning or development as of this summer, but a slowdown in new development is projected as new supply is being absorbed and construction and financing costs continue to rise.