DEED awards $347,450 for downtown hotel
227 N. Minnesota to be redeveloped into 80-room boutique hotel
The Minnesota Department of Employment and Economic Development (DEED) awarded New Ulm a redevelopment grant for the property at 217-227 N. Minnesota Street for $347,450. The funds will be use to redevelop the property into an 80-room hotel. Photo by Clay Schuldt
The property at 217-227 N. Minnesota is expected to receive significant renovation to accommodate a small downtown hotel. Photo by Clay Schuldt
The Minnesota Department of Employment and Economic Development (DEED) awarded New Ulm a redevelopment grant for the property at 217-227 N. Minnesota Street for $347,450. The funds will be use to redevelop the property into an 80-room hotel. Photo by Clay Schuldt
The property at 217-227 N. Minnesota is expected to receive significant renovation to accommodate a small downtown hotel. Photo by Clay Schuldt
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NEW ULM - After two years of discussion, bringing a downtown hotel to New Ulm takes a big step forward.
The proposed boutique hotel project at 227 N. Minnesota Street was recently awarded $347,450 in funding from the Minnesota Department of Employment Economic Development (DEED).
This $347,450 was part of over $2 million in redevelopment awards given out by DEED during this grant cycle.
In July, the City of New Ulm submitted a grant application to DEED for the purpose of redeveloping 217-227 N. Minnesota Street into a new hotel. At that time, property owner Paul Neyers approached the city regarding the development of the property into a hotel that would include demolition, construction and rehabilitation of the current building.
As part of the project financing, Neyers requested the city submit an application to DEED for a redevelopment grant to fund up to 50% of the eligible redevelopment costs. The developer is required to provide matching funds for the grant.
The idea to bring a smaller hotel to this site was first presented to the New Ulm Economic Development Authority (EDA) in 2024. At that time the EDA had ordered a hospitality study determining the viability of a downtown hotel. Results of the study showed a hotel could earn $1.09 in net income.
As part of this project, the buildings at 217-227 would be redeveloped into an 80-room hotel with 3,500-square feet of event space. The property would continue to house the Kaiserhoff, which would serve as the anchor restaurant for the development.
Deed anticipate the project will create 21 jobs, retain 13 job, increase the local property tax base by $264,568 and leverage $29 million of private investment.