He said the city began preparing for Pinnacle's departure once it filed for bankruptcy.
"Obviously we're disheartened, but it does not in any degree deter our determination to restore downtown to a vibrant, bustling area," he said.
Pinnacle's new headquarters will be the five stories of office space above Delta's large hangar at Minneapolis-St. Paul International Airport. The airport owns the building, but it's leased to Delta through 2020 and Delta wasn't using the office portion, said Jeffrey Hamiel, executive director of the Metropolitan Airports Commission, which runs the airport.
He said the airport might spend roughly $500,000 to upgrade the office space to get it ready for Pinnacle, but other than that it's not offering any financial incentives to lure the airline.
AP Business Writer Adrian Sainz in Memphis contributed to this report.