Strategic Capital Partners Capital Project Request Hotel GM Marriott Tapitio Pass Hugo Gryll Project Name Project Description: Upgrade Guest Room Locking System This project will install the Franchisor approved guest room locking system and will allow guests to use their smartphones to bypass the front desk and unlock their doors. The Franchisor has tested this system in 250 hotels for the past 2 years and is scheduled to rollout globally within the next 3 years. This upgrade will be a mandatory brand standard beginning in 4 years, however there are incentives being given by the locking system vendor to install earlier. Based on the hotel results for those hotels piloting the system, they have been able to reduce front desk guest service agent man hours by 40%. The system is enormously popular with guests. Proforma Assumptions: The system will take 2 weeks to install and will be done by floor. We do not anticipate having any guest rooms out of service during the conversion. We will be taking advantage of the vendor preferred pricing and are assuming the 40% staffing reduction which has been achieved by the pilot hotels. We are assigning this project a low risk based on the Franchisor experience in the pilot hotels. Risk Low Cash Flow Proforma Capital Investment Incremental Cash Flow Incremental Cash Flow Incremental Cash Flow Incremental Cash Flow Incremental Cash Flow For Asset Manager Use: 5 Discount Rate 5 NPV 7 Period 0 Amount $ (155,000) 65,000 $ 66,950 ssssssssssssss 68,959 71,027 $ 73,158 2 23 3 $ 4 $ 5 in