A college is interested in upgrading its facilities management building because of technological obsolescence, rising energy and maintenance costs, and increasing staffing costs. There are three alternatives to be considered: remain (do nothing), renovate the existing facilities, or build a new facility. The estimated costs for each alternative are presented in the following table. (25 points)

Alternative 1- Remain in existing building	Cost, $
Replace air-handling units within 5 years
Re-roof the building-10 years
Salvage value
Annual Energy Consumption
Maintenance/repair costs per year
Facility staffing annual cost
Alternative 2-Renovate the building [100,000 gross square feet (GSF)]
Renovation construction cost
Re-roof building in 10 years
Salvage value
Annual Energy Consumption
Maintenance/repair costs per year
Facility staffing annual cost
Alternative 3-build a new facility [80,000 gross square feet (GSF)]
Renovation construction cost
Demolish existing building
Salvage value in 25 years	60% of initial cost
Annual Energy Consumption
Maintenance/repair costs per year
Facility staffing annual cost

The VP of this college has requested the architect/engineer team to perform a life cycle analysis of these three alternatives using the PW method of analysis. The economic criteria for the analysis are as follow

Project Life Cycle: 25 years

Discount rate: 8% compounded annually

Inflation approach: Constant Dollars

Differential escalation rates are:

Energy: 2%

Maintenance/repair: 2%

Staffing: 4%

Following the spreadsheet format provided below, conduct the life cycle analysis of these alternatives. (For full points make sure to provide the information of the highlighted cells) Note: Do not submit Excel Files.

Which alternative would you recommend for being implemented?

:

Alternative 1- Remain in existing building Replace air-handling units within 5 years Re-roof the building-10 years Salvage value Annual Energy Consumption Maintenance/repair costs per year Facility staffing annual cost Alternative 2-Renovate the building 1100,000 gross square feet (GS Renovation construction cost Re-roof building in 10 years Salvage value Annual Energy Consumption Maintenance repair costs per year Facility staffing annual cost Alternative 3-build a new facility [80,000 gross square feet (GSF)T Renovation construction cost Demolish existing building salvage value in 25 years Annual Energy Consumption Maintenance/repair costs per year Facility staffing annual cost Cost, S 500,000 150,000 125,000 100,000 80,000 50/GSF 150,000 100,000 80,000 60,000 110GSF 4/GSF 60% of initial cost 75,000 60,000 45,000