National convention

What the 2024 Republican National Convention victory says about Milwaukee

Milwaukee is set to host the Republican National Convention in 2024, a landmark political event that promises to bring $200 million in economic impact and more than 60,000 people between politicians, delegates and the national press.

It’s a blow for the city, which outbids Nashville, Pittsburgh and Salt Lake City for the event.

And it should be noted that this is no coincidence. The upcoming RNC will be Milwaukee’s second national convention in as many presidential election cycles, having previously hosted the 2020 Democratic National Convention.

For those wondering how Milwaukee, one of the smallest cities to ever host a national presidential nominating event, managed to land two back-to-back conventions, one must first understand that the heart of this city has undergone a transformation. unprecedented in recent years.

Big changes underway in the brewing city

Although many aspects of Milwaukee’s blue-collar, beer-brewing image popularized by 1970s sitcoms like “Happy Days” and “Laverne & Shirley” still exist, downtown Milwaukee has become increasingly increasingly cosmopolitan over the past decade, thanks to a multi-billion dollar renaissance. and an impressive 23% increase in population.

Three large breweries that were once dominant features of downtown Milwaukee’s identity – Pabst, Schlitz and Blatz – have all closed and been redeveloped into mixed-use complexes including offices, apartments, retail and hotels .

The same goes for the Grand Avenue Mall, a 370,000 square foot indoor mall that closed in 2019 and was transformed into The Avenue, a mixed-use office and apartment complex with a popular dining room on the ground floor.

Downtown Milwaukee has also been remodeled and redefined with the conversion of more than 1 million square feet of office space into apartments and hotels, a new streetcar system called The Hop, and a slew of new office and apartment towers. luxury. Just two months ago, city officials celebrated the opening of Ascent, which is now officially the tallest log building in the world.

These changes were most noticeable in the western part of downtown, where the conference will be held. Once marred by a sea of ​​parking lots due to urban renewal efforts in the 1950s and 1960s, forward-thinking urban planning policies and the success of the city’s professional basketball team, the Milwaukee Bucks, have makes this area a hotspot for nightlife and entertainment.

The Park East Freeway Spur, which was demolished in the early 2000s, attracted over $1.1 billion in infill development in its place. The Milwaukee Bucks, with new owner and international superstar player Giannis Antetokounmpo, have invested heavily in the area with their Deer District development. At the center of the Deer District is the Fiserv Forum, a state-of-the-art $524 million arena built in 2018. Surrounding the arena are new bars and restaurants and an outdoor viewing plaza, which has hosted over 100,000 spectators. fans for Game 6 of the 2021 NBA Finals, when the Bucks defeated the Phoenix Suns 105-98. Additionally, the Bucks are building an upscale 207-room hotel dubbed “The Trade,” which is slated to open in early 2023 and will be part of Marriott’s Autograph Collection brand.

The City of Milwaukee is also doubling its ability to compete for major conventions and events in the future by undertaking a major expansion of its convention center, the Wisconsin Center. Calls for its expansion have continued for years, as its current footprint of 265,000 square feet is more comparable to convention centers in smaller markets such as Grand Rapids, Michigan and Des Moines, Iowa. The 179,000 square foot expansion is heavily focused on increasing the capacity of the main showroom from 189,000 square feet to 300,000 square feet. The $420 million expansion is set to wrap up in early 2024, just in time for the RNC.

Milwaukee’s hospitality industry should see a big boost from RNC

The event is likely to occur in July or August 2024, so hotel owners and operators can expect to see strong hotel revenue per available room, or RevPAR, during the month of the convention.

Based on data dating back to the 2000 Republican National Convention in Philadelphia, host cities experienced a substantial increase in RevPAR during the month of the convention. For the five RNCs held between 2000 and 2016, the average RevPAR during the convention month was 28% higher than the three-year average RevPAR for the same month, based on data tracked by STR, the analytics firm hotel data from CoStar.

The 2020 RNC in Charlotte, North Carolina was an exception to the rule, with declines in occupancy, average daily rate and RevPAR. This can be attributed to the disruption caused by the coronavirus, as that year’s RNC took place only a few months into the pandemic and resulted in a partially virtual convention.

Milwaukee’s recovery from the pandemic has lagged, with July year-to-date occupancy still down from 2019 numbers by about 10.5%. Market RevPAR is still below 2019 levels by 11%. However, the city’s ADR is up 5% from the same period in 2019.

Based on historical hotel performance data from previous RNCs, Milwaukee’s increase in RevPAR during the convention month will likely be driven more by ADR growth than occupancy. For each of the five conventions held between 2000 and 2016, ADR growth during the month of the convention averaged 26%, while occupancy fell slightly, by around 0.1% , compared to the average of the previous three years for the same month.

More recent RNC conventions have provided an even greater boost to hotel performance, with the 2012 convention in Tampa driving RevPAR growth of 63% and the 2016 convention in Cleveland increasing the RevPAR of hotels in the city by 42%. The Tampa convention drove ADR growth of 36% and the Cleveland convention boosted ADR by an impressive 48% during the month of the convention.

The three-year average RevPAR for July from 2017 to 2019 in Milwaukee is $95.90 and the three-year average for August is $88.50, according to STR data. Milwaukee’s RevPAR gains over the month of the convention will likely be closer to Tampa and Cleveland’s RevPAR growth, and will likely be between 45% and 60%, as Milwaukee’s expected convention attendance numbers is similar to Tampa’s attendee count. and Cleveland RNC.

The revival currently underway in downtown Milwaukee will further propel the market’s hotel RevPAR performance during convention month and beyond.