Asset management solutions for investors and owners of •  hotels •  resorts •  serviced apartments with a focus on value driven strategies aligned to owners’ return expectations

Melbourne • Sydney • Bangkok • Washington D.C

3R Hospitality – Asset Management Hotels • Resorts • Serviced Apartments

Asset manager

Owner Operator

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To support its development of services toward banks, financiers, loan servicers, fund managers, accountants, owners and investors, 3R Hospitality is introducing its asset management platform for hotels, resorts and serviced apartments. Hotels are a specialist asset class and require active and specific management – many real estate investors do not understand hotels as operating businesses. 3R Hospitality adopts an owner’s perspective and overseeing the company’s partners (landlords, co-investors, and management companies), questioning assumptions, and identifying opportunities to add value both in revenue and capital appreciation. Using proven strategies and creative ideas, 3R Hospitality designs and implements short term tactics and long term strategies to improve the investment performance of hospitality assets.

There are no textbook solutions, owner representatives have to be creative…

General approaches Understanding the local situation • Pre-opening strategies • Renovation planning • Market repositioning • Exit and disposition • Long term holding strategy • Working with the operator • Risk planning

• Review sales and marketing strategy • Review business plan and cash flow forecast • Review cash management, loan covenants and debt service coverage requirements • Review capital expenditure plans • Monitor accounts payable and receivables over 30-60-90 day cycles

Monitoring Review variances Rolling forecast Benchmarking

Management meetings

Ownership objectives Holding strategies

Asset values Investment cycle

Return

Business Plan review

Strategic plan Operating budget Financial budget CapEx budget

Reporting Management reporting

Financial Operational

Control Corrective actions

Refine implementation Inspection

Compliance

Adopt strategies for each phase of the life cycle of the hotel, each phase of the economic cycle and each phase of the holding period

Sales & Marketing • Distribution channels • Distribution mix • Discounting strategy • Marketing mix optimization • Sales and marketing reward

system

• Value of brand delivery • Third party intermediaries • Regional origins of travelers • Price elasticity and rate parity • Measure competitive performance, market

share and penetration

3R Hospitality – Asset Management Hotels • Resorts • Serviced Apartments

3R Hospitality – Asset Management Hotels • Resorts • Serviced Apartments

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Adopt lessons from abroad bearing in mind the local context…

Operating performance review F&B concepts • Business plan review

-  1 year budget, marketing plan -  5 year strategy

• Unexploited revenue opportunities • Brand standard compliance review • Guest satisfaction review • Procurement process review • Ensuring insurance and other risk

management programs are in place

• Service types • Customer flow • Concept design and review • Outsourcing opportunity • External opportunities • Menu engineering • Purchasing

Discipline and expertise are required during the annual business planning process

Services to investors Services to lenders • Assisting with lender reporting • Perform hold/sell analysis • Perform due diligence on acquisitions • Underwriting of new acquisitions • Debt structuring • Refinancing options • Provide acquisition & disposition support

• Covenant testing • Covenant breech - Financial breach - Non financial breach • Asset work-out • Special situation • Corporate restructuring

Clients Understanding equity market • Property funds and trusts • Institutional investors • Family offices and high net worth individuals • Lenders (senior, mezzanine, hybrid) • Majority and minority owners

• Capitalization rate cycle • Capital vs. income return • Separating the signal from the noise • Liquid vs. illiquid markets

3R Hospitality is not affiliated with any group or hotel brand. It is a brand-neutral company that can advise group on their individual brand strategies to 1) develop their own brands or 2) leverage the power of leading global hotel brands – depending on each hotel’s unique market and characteristics. Our experienced leadership team possesses extensive knowledge of hotel management and analytical skills from years of working in the industry globally. We offer tailored strategic solutions that meet the needs of each hotel’s market, scale and features from city-center and business hotels to resort properties. Wherever possible 3R Hospitality takes a sustainable approach to hospitality asset management and applies best practice systems and processes, especially in relation to environment and social impact.

Communication Legal • Interacting with management companies • Discussions with hotel general managers • Regular visits to hotels

• Management agreement reviews • Covenant testing • Lease covenant review and monitoring • Insurance • Property taxes

3R Hospitality – Asset Management Hotels • Resorts • Serviced Apartments

Investment review Finance • Planning, scheduling, executing and monitoring CapEx

-  Required amenities and upgrade CapEx -  Upgrade CapEx vs. innovative CapEx -  Opportunity cost

- Prepare asset for sale • Proactively negotiating with hotel retail tenants • Re-branding opportunity • Reviewing space utilization • Reviewing subleases

• Providing full support to owners during annual budgeting process • Working closely with operators to achieve financial targets • Monitoring and analysing financial reports and business plans • Reviewing profit centers performance, revenue centers and cost

centers rational • Cost cutting vs. generating revenue approaches • Comparing performance with industry standards • Comparing performance with local market (if data available)

Sales & Marketing approaches Reporting • Proactive action plan (economic growth and downturn) • Repeat conference events (annually, every two years) • Budgeting scrutiny, and rational/assumption review • Budgeting and re-forecast (quarterly, semi annually) • Revenue delivery channels, booking pace reports, • Reviewing forecasting accuracy • Benchmarking of top line performance indicators

• Quarterly asset performance overviews and forecasts • Monthly reports and commentary on prior month’s performance

(variance analysis with budget and previous year) and upcoming month’s forecast

• Institutional quality reporting • Reporting based on proprietary template, or tailored template • On a monthly, quarterly and annual basis

Robert Wilson • 30 years experience in hotel investment, asset management, development and sales and marketing

• Senior executive for development and operations, head of region • Holiday Inn Worldwide, Marriott International, Panorama Hospitality, Morgan Stanley

Reas Kondraschow

• 30 years experience in hotel investment, operations, development and franchising ventures

• Senior roles in brand management and development. International experience and responsibilities. Private equity capital structuring

• Marriott, Holiday Inn Worldwide, Wyndham and Whitbread plc

Pierre-Edouard Vintrou

• 12 years experience in hotel investment, asset management, financing and hotel operations

• Experience with equity, preferred equity, performing and non performing debt • InterContinental Hotels Group, Royal Bank of Scotland, TriMont Real Estate Advisors

Arnaud Millecamps • 12 years experience in corporate finance, investment appraisal and franchising • Financial projections, strategic development support, • InterContinental Hotels Group, KPMG, Orange (VC Incubator for IT companies) • Small and medium enterprises / startup experience

Jeff Brown • Internationally experienced hotelier. Managed large hotels in China, Korea and Australia • Strong understanding of food and beverage operations • Supervised large renovation projects • Holiday Inn, Crowne Plaza, Panorama Hospitality

Asset management team leaders

3R Hospitality LLC 34477 Holly Tree Lane Dagsboro Delaware 19939 USA +1 908 391 7827

3R Hospitality Pty. Ltd. Level 2, 710 Collins Street Docklands, Victoria 3008 Australia +61 3 9097 1622

info@3RHospitality.com

3R Hospitality South East Asia Level 18 Park Ventures Ecoplex Lumpini, Patumwan Bangkok, 10330 Thailand +66 2309 3447