Hotels sprout in metro
If it seems like there are a lot of new hotel projects in the Twin Cities, that’s because there are — and the market will support them, according to a national measure of supply and demand for hotels.
Demand for hotel rooms was up 4.5 percent in the 12 months ending in April, compared to the hotel industry’s 20-year compound annual growth of 1.6 percent. The data was recently published by Smith Travel Research and was reported on calculatedriskblog.com.
During that same 12-month period, U.S. hotels hit an all-time high occupancy of 65 percent and average daily rate of $117 a room. The industry is seeing record highs in one of its most telling metrics, revenue per available room, at $76 nationally. Smith Travel Research predicts this measure will continue to increase by 6.6 percent in 2015 as developers work to balance the equation by adding new supply.
Nearly every major developer in Minneapolis has a plan or proposal for a new hotel downtown. Ryan Cos. plans to build a Radisson Red, M.A. Mortenson Co. is moving forward with its AC Marriott, Sherman Associates has a hotel in the works at its Thresher Square property and three developers are competing to build a hotel on the vacant 800 Washington Av. parcel.
Mortenson recently opened a Hampton Inn & Suites in downtown Minneapolis, while TPI Hospitality is planning to convert an existing office building into a Holiday Inn Express.
Over in St. Paul, developer Exeter Group is converting the former U.S. Post Office into apartments and a Hyatt Place while Opus Development plans to include a hotel in its redevelopment project at the former Seven Corners Hardware site.
Kristen Leigh Painter