Assume the required is now at 20%. What is the project's IRR? Should it be accepted? why?

Randi and John are partners in a 100-room limited service hotel. It has a great location right across from the beach. They are going to renovate the rooms floor by floor and the entire project has a cost of $1,200,000. The extra cash in-flows produced from this renovation are $395,000 per year for the next seven years. What is the project's regular payback period? If Randi and John have a set criterion to not to invest in anything that will take more than 3 years to recover, should they invest in this project