ROCHESTER — For the past two years, hotels and restaurants here have been hit hard as tourism plummeted.

Almost three-quarters of tourists come to visit Mayo Clinic. The pandemic and lockdown forced hospitals, including Mayo, to limit patients and focus only on emergency procedures.

That hurt the local tourism scene, even after Minnesota lifted a moratorium on nonemergency services in May 2020 and Mayo Clinic resumed regular operations.

Now, even with the pandemic far from over, local business owners feel their fortunes turning.

Loading...

"The Great American Reconnection is right here on the horizon," said Joe Ward, president of Experience Rochester. "People want to get together."

Rochester tourism officials are touting expanded opportunities for Med City visitors and area businesses and attractions say they're ready for an anticipated rise in tourism in 2022.

Local hotel revenue is closing in on pre-pandemic levels. Rochester's occupancy rate fell by 40% in 2020 compared with the previous year, but those numbers are ticking back up. The most recent state lodging report showed Rochester's March occupancy rate at 49.2%, almost 20% higher than that of March 2021.

Rochester added four hotels over the past three years, though some projects were in the works before 2020. That includes Hotel Indigo, which was a Holiday Inn before California-based EKN Development Group bought it in 2018 for renovation and rebranding. The additions bring Rochester's total hotel rooms to more than 5,700 as of 2021.

Hotel Indigo, which opened in January 2020, is seeing a constant stream of business lately, according to Michael Smith, the hotel's general manager. Smith has worked at hotels in Rochester for 34 years and said some in the area hit "single-digit percentage" occupancy rates during the worst of the pandemic.

"There's a definitely positive direction right now," he said. "We're moving toward the light, which is nice after two years of this nightmare."

That's welcome news compared to early on in the pandemic. Gross sales in Olmsted County's tourism industries — which includes arts, entertainment, recreation, hotels, and food and drink — were down more than 20% in 2020 compared with the previous year, according to the Minnesota Department of Revenue.

Statewide, hospitality business owners expect it will take several years before sales return to normal. A recent survey by Hospitality Minnesota, the Federal Reserve Bank of Minneapolis and Explore Minnesota found about half of food service and lodging operators surveyed believe business won't recover until 2023 or later.

Rochester area businesses such as Forager Brewery say they receive international attention through events. Forager owner Annie Henderson said the six-year-old brewery and restaurant attracts hundreds of people from around the world each year for festivals and beer releases.

The brewery's annual barrel-aged beer release drew 200 to 400 people last weekend; customers slept outside in the rain Friday night. People have traveled from as far away as Japan for previous events, she said.

Laura Elwood, president of the Rochester Trolley & Tour Co., said the company has plans to expand its services this year.

Elwood's company, Chamberlain Concierge & Lifestyle Management, bought the trolley company in 2020 but was forced to shut down due to COVID regulations. The company reopened services in May 2021 but couldn't take advantage of the season.

This year, Rochester Trolley & Tour plans to offer more tours for kids and of breweries and wineries, among others.

Popular events that started in the pandemic, such as the Night Market, will expand this year.

Tiffany Alexander founded the Night Market to give communities of color opportunities to connect and sell their wares, and organizers expected only a few hundred people to attend. The first event drew 8,000 people from across the state, prompting Alexander to work with Experience Rochester to offer more Night Market events this year.

Alexander said the new events could help some locals grow their hobbies into sustaining businesses.

"There's so much more to this community," she said. "I didn't know that existed or could exist."