Minnesota’s December and Full Year 2011 Lodging Performance
Release Date: Feb 13, 2012
This article and graphs are provided under permission granted by STR (Smith Travel Research, Inc.), the source of the data.
Minnesota’s lodging industry ended the year with annual year-over-year growth for each of six reported metrics – occupancy, supply, demand, revenue, room rate and revenue per available room (RevPAR). Also, December monthly changes included year-over-year growth for five of the six metrics, with room supply (-0.1%) being the exception. December was the first month in quite a while that saw U.S. and regional growth rates exceed Minnesota’s growth for all six metrics. Two sets of graphs, with links below, show changes in Minnesota’s lodging metrics during 2011. For historical perspective, 2011 provided the lodging sector with a continuation of the recovery that started in 2010, following a dismal 2009.
2011 Lodging Performance Changes for Minnesota, the U.S., the Region and Minnesota Areas - Minnesota’s annual growth in all metrics was similar to growth rates for the U.S., differing by no more than a percentage point on each. On the other hand, Minnesota’s annual growth exceeded the region’s (i.e., the seven-state West North Central U.S.) for all metrics except room supply. Within Minnesota, all of Minnesota’s 10 distinct market areas (i.e., five in the Minneapolis-St Paul metro and five in Greater Minnesota) experienced annual growth in at least five of the six metrics. Four Minnesota market areas experienced negative annual change in room supply. For the year, lodging metrics for the Minneapolis-St Paul metro markets generally showed slightly stronger growth when compared with markets in Greater Minnesota. However, this pattern was not nearly as pronounced for 2011 as it was for 2010, with instances of individual Greater Minnesota areas outperforming metro areas on each metric.
Annual changes in Minnesota lodging metrics for 2011 (i.e., compared with 2010) and 2010 were:
- Occupancy +3.9% for 2011 (6.5% for 2010)
- Supply 0.3% (1.0%)
- Demand 4.2% (7.5%)
- Revenue 8.8% (7.7%)
- Room rate +4.4% (0.2%)
- RevPar +8.5% (6.6%)
2011 Month-by-Month Lodging Performance Changes for Minnesota – Minnesota’s growth in year over year monthly lodging metrics was fairly strong and consistent for most metrics through the first three quarters of 2011. July was the exception, with weaker growth that may have been associated with the state government shutdown during the first 20 days of that month. Otherwise, growth in demand and room rates fueled strong growth in occupancy, revenue and RevPAR through September. Then, growth slipped in all of the metrics starting in October, setting the pattern of weaker growth for the remainder of the year. During the fourth quarter, continued (if weak) growth in room rates combined with small declines in room supply to prevent growth in occupancy, revenue and RevPAR from slipping even further, as demand growth declined.
March and April stand out as the months with the strongest occupancy and demand growth during 2011. Strengthening room rate growth through September provided a boost to revenue and RevPAR growth in June, August and September, putting these months on par with March and April for revenue and RevPAR growth.
Click below for accompanying graphs of Minnesota lodging performance (repeats of links from above):
