Minnesota lodging: Now I lay me down to sleep

Irrespective of the record heat, summer is a time for vacations, especially to places like the northwoods of Minnesota, where camping and old-time resorts with individual cabins are a time-tested tradition for many families. But as in any industry, things change, and the lodging industry in Minnesota has undergone some subtle shifts in the places people lay their heads during vacation or while on a work trip.

Explore Minnesota Tourism, the state’s tourism office, keeps a running (though unofficial) tally of lodging facilities of varying type, including indoor and outdoor. From 2002 to 2011, the total number shrank by 4 percent (see Chart 1). Resorts saw a 26 percent decline and had the largest loss in absolute numbers, losing about 290 operators. Private campgrounds saw a smaller loss in number (about 190) but a higher percentage loss (28 percent). That loss was somewhat offset by growth in state and other public campgrounds, which are fewer in number. Hotels and motels grew slightly, and vacation homes for rent (not listed in the chart) grew strongly from a percentage standpoint, but its listings are still small, at just 90 in 2011.

Despite the loss of facilities, the total number of lodging units has remained mostly unchanged over this period (see Chart 2). First, a little context: Riding the coattails of a hot economy in the 1990s, a tourism and lodging boom added thousands of hotel and other lodging units to the state. The echo of that boom started to die out in 2003, and the number of indoor lodging units in the state actually dropped by 1,500 by 2007. But by 2011, the number of indoor lodging units had bounced back by almost 1,900 units (about 2.5 percent).

At the campsite, it’s a fairly similar story (see Chart 2). Despite an erosion of campground operators, the number of individual campsites in 2011 is mostly unchanged from 2002, though there was some volatility in the middle. From 2006 to 2008, the number of tracked campsites fell by about 3,500 (10 percent), but then quickly rebounded by 2011.

Shifts in consumer demand underly these short- and long-term lodging patterns, as consumers demand new and different accommodations and amenities over time, and recessions tend to force out less competitive facilities from the market, leaving new opportunities when demand rebounds. Explore Minnesota reports that the state lodging industry saw “moderate improvement” through the first half of 2012, including a 1 percent increase in occupancy.