The Minnesota hotel industry, encompassing 918 properties for a total of 73,312 rooms, saw continued performance improvements in first-half 2013. Occupancy increased from 53.2% in May 2012 to 56.9% in May 2013. The state is still slightly below the national average of 60.2%.
The average daily rate (ADR) in Twin Cities hotels decreased slightly from $98.88 in November 2012 to $96.67 in May 2013. Revenue per available room (RevPAR)—the hotel industry’s key financial measure—increased by 5.0% overall year to date.
Among the submarkets, Bloomington has historically enjoyed the highest occupancy numbers, but Minneapolis is now outperforming all the submarkets with occupancy rising to 74.3% in May 2013. It is also now attracting the highest average daily rate at $142.82.
The second half of 2013 is expected to be strong. Of the 240 hotels and motels, resorts, B&Bs, campgrounds and vacation home rentals polled in a recent survey conducted by Explore Minnesota Tourism, 38% expect a better year in 2013 than 2012 and 46% said they expect as good a year as last. Nearly half predict higher revenues in 2013.
HotelNewsNow reports that while still leery of real estate investments in general, investors are most confident putting their money to work in hotel acquisition funds. The ongoing recovery in the hotel sector makes the industry an appealing asset class.
To read more, visit the July 2013 edition of Cushman & Wakefield/NorthMarq’s Compass report, now available online. Visit the web site: www.northmarqcompass.com