Milwaukee is slated to host the Republican National Convention in 2024, a headlining political event that promises to bring in $200 million in economic impact and more than 60,000 people between the politicians, the delegates and the national press.
It is a coup for the city, which outbid Nashville, Pittsburgh and Salt Lake City for the event.
And it should be noted that this is no fluke. The upcoming RNC will be Milwaukee’s second national convention in as many presidential election cycles, having previously played host to the 2020 Democratic National Convention.
For those wondering how Milwaukee, one of the smallest cities to ever play host to a national presidential nominating event, managed to land two consecutive conventions, one must first understand that the heart of this city has undergone an unprecedented transformation in recent years.
Big Changes Underway in the Brew City
Though 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 cosmopolitan over the past decade, thanks to a multi-billion-dollar renaissance and an impressive 23% increase in population.
Three major breweries that once were dominant features of downtown Milwaukee’s identity — Pabst, Schlitz and Blatz — have all closed and been redeveloped into mixed-use complexes featuring offices, apartments, retail and hospitality.
The same goes for the Grand Avenue Mall, a 370,000-square-foot indoor mall that closed in 2019 and has been remade into The Avenue, a mixed-use office and apartment complex that boasts a popular, ground-floor food hall.
Downtown Milwaukee has also been reshaped and redefined by the conversion of over 1 million square feet of office into apartments and hotels, a new streetcar system called The Hop and a flurry of new office and luxury apartment towers. Just two months ago, city officials celebrated the opening of Ascent, which is now officially the tallest mass timber building in the world.
These changes have been most notable in the west part of downtown, where the convention will be held. Once marred by a sea of parking lots due to urban renewal efforts in the 1950s and 1960s, forward-thinking urbanist policies and the success of the city's professional basketball team, the Milwaukee Bucks, have made this area a hot spot for nightlife and entertainment.
The Park East Freeway spur, which was demolished in the early 2000s, has attracted over $1.1 billion of infill development in its stead. The Milwaukee Bucks, with new ownership 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 accommodated over 100,000 fans for Game 6 of the 2021 NBA Finals, when the Bucks beat the Phoenix Suns 105 to 98. Additionally, the Bucks are constructing a 207-room upscale hotel dubbed "The Trade," which is expected to open in early 2023 and will be part of Marriott’s Autograph Collection brand.
The city of Milwaukee is also doubling down on its ability to compete for major conventions and events in the future by undertaking a major expansion to its convention center, the Wisconsin Center. Calls for its expansion have gone on for years, as its current 265,000-square-foot footprint 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 centered around increasing capacity to the main exhibit hall, which will increase in size 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 Likely to See Big Boost from RNC
The event is likely to occur in July or August of 2024, so hotel owners and operators can expect to see strong hotel revenue per available room, or RevPAR, performance during the convention month.
Based on data going back to the 2000 Republican National Convention in Philadelphia, host cities have experienced a substantial boost in RevPAR during the convention month. For the five RNCs held between 2000 and 2016, the average RevPAR over the convention month was 28% higher than the three-year average RevPAR for the same month, based on data tracked by STR, CoStar’s hospitality data analytics firm.
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 disruption caused by the coronavirus, since that year's RNC was held only a few months after the onset of the pandemic and resulted in a partially virtual convention.
Milwaukee’s recovery from the pandemic has lagged, with year-to-date July occupancy still behind the 2019 figures by about 10.5%. Market RevPAR is still below 2019 levels by 11%. However, the city's ADR is up 5% compared to the same period in 2019.
Based on historical hotel performance data from prior RNCs, Milwaukee’s RevPAR lift 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 in the convention month averaged 26%, whereas occupancy declined slightly, by about 0.1%, compared to the prior three-year average for the same month.
More recent RNC conventions have delivered an even bigger boost to hotel performance, with the 2012 convention in Tampa driving RevPAR growth of 63%, and the 2016 convention in Cleveland boosting RevPAR for the city’s hotels by 42%. The Tampa convention drove ADR growth of 36% and the Cleveland convention bolstered ADR by an impressive 48% in the convention month.
The three-year average July RevPAR from 2017 to 2019 in Milwaukee is $95.90 and the three-year average for August is $88.50, per STR data. Milwaukee’s RevPAR gains during the convention month will likely be closer to Tampa and Cleveland’s RevPAR growth, and will probably land in the 45% to 60% range, since the number of attendees expected at the Milwaukee convention is similar to the attendance numbers from the Tampa and Cleveland RNCs.
The renaissance currently underway in downtown Milwaukee will further propel the market’s hotel RevPAR performance over the convention month and beyond.