EMBASSY SUITE UNO HOTEL FINANCIAL PROPOSAL

April 2014

Howard Hao Li

Abudullah Algwaiz, Xinyan Wu

Wenqian Xu, Xiangdong Cao

AGENDA

Introduction

Site Analysis

Hotel Design, Brand, and Management

Financial Analysis

INTRODUCTION

BUILDING INFORMATION

Built in 1960

Modern Architectural Style

Building Size: 111,141 Sq Ft.

Thirteen-Story

Net Rentable Area: 97,661 sq. ft.

INVESTMENT STRUCTURE

SITE ANALYSIS

HOSPITALITY INDUSTRY IN NEW ORLEANS

REVIEW OF HOTEL TRANSACTIONS

LOCATIONDistance to Superdome

Distance to Bourbon Street

COMPARABLE PROJECTSHotel Name Stars Address Distance away

1600 Canal

Average

Daily Rate

Embassy Suites

New Orleans

3 Stars 315 Julia Street 1.5 miles 2-BD $180

1-BD $150

The

Saint Hotel Autograph

Collection

4 Stars 931 Canal Street 0.8 miles 2-BD $280

1-BD $220

The Roosevelt New

Orleans

4 Stars 130 Roosevelt way 0.5 miles 2-BD $330

1-BD $280

Wyndham Garden Hotel 3 Stars 201 Baronne Street 0.6 miles 2-BD $180

1-BD $130

Category of Guest Room Projected Average Daily Rate

2-BD Guest Room $ 0.34/Sqft * 819 Sqft = $ 280

1-BD Guest Room $ 0.34/Sqft * 605 Sqft = $ 206

weighted average ADR (average daily rate):

0.3*($330 / 819 ) 0.5*($280 / 819Sqft) 2*0.1*($180 / 819Sqft) $0.34 /Sqft Sqft

COMPARABLE PROJECTS

HOTEL DESIGN, BRAND, AND MANAGEMENT

HOTEL DESIGN

Floor plan for the 1st floor

Area per floor: 9768 sqft.

Number of floors:13

Percentage of two-room suite: 80%

Percentage of single room: 20%

Total number of suites: 96

Total number of single rooms: 24Registration

desk

stairs

stairs

Lobby:3530.1

sqft

Number of suites per

floor: 8

Number of single rooms

per floor:2

Size of single room: 605

sqft

Size of two-room suite:

819 sqft

Floor plan for 2nd to 13th floor

Single room:

605sqft

Suite:

819sqft

Corridor:6ft

HOTEL BRANDING AND MANAGEMENT

EMBASSY SUITES IN NUMBERS

>200

HOTELS THROUGHOUT NORTH AMERICA

>50,000

SUITES

73.0%

AVERAGE OCCUPANCY

126.03

REVPAR INDEX

MANAGEMENT BY HILTON WORLDWIDE

Hilton HHonor™

Hilton Worldwide Sales

Hilton Reservations & Customer Care (HRCC)

Global Online Services

Revenue Management Consolidated Center (RMCC)

Information Technology (IT)

Hilton Supply Management (HSM)

MANAGEMENT FEE

Initial Fee 75000 plus $400 for each additional guest

suite over 250

OnQ

hardware

10000

OnQ

Software

100000

Monthly

Royalty Fee

3.5% for Year 1, 4.5% for year 2 and 5.5% for

the reminder of Gross Rooms Revenue

Monthly

Program Fee

4% of Gross Rooms Revenue

HOTEL REVENUE AND OPERATION COST

Source: STR Analytics' 2013 HOST Almanac

Full-service hotels average occupancy of 70.2%

$244.76 in total revenue per occupied room night, up to 336

Gross operating profit 34.1%

Assumption Remark

Occupancy rate 80%

Total revenue per occupied room 280

Gross operating Cost 60% inc. Management Fee

Gross operating profit 40%

FINANCIAL ANALYSIS

ASSUMPTION

ASSUMPTION

• The hard costs and management fee-“Franchise Disclosure” document provided by the Embassy Suites.

• Sizeler Property Investors 95%

• $25 parking with net revenue 20%, 30% parking using per room

• Food and Beverage 10% room revenue

TAX BENEFIT

Tax Credit Assumptions

Qualified Equity Investment (% of Initial Investment) 80%

Qualified Equity Investment ($) $ 24,459,264

Federal Historic Tax Credits (% of Qualified Equity Investment) 20%

State HTC (% of QEI after subtracting Federal HTC) 25%

New Market Tax Credits (% of QEI in year 1,2,3) 5%

New Market Tax Credits (% of QEI in year 4,5,6,7) 6%

TAX BENEFIT

Tax Credits

Federal Historic Tax Credits $ 4,891,853

State Historic Tax Credits $ 4,891,853

New Market Tax Credits $ 1,222,963

PRO FORMA HIGHLIGHT

Financial HighlightsYear 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7

Total Revenue

$

10,274,429

$

10,785,522

$

11,322,170

$

11,885,651

$

12,477,305

$

13,098,543

$

13,750,842

Gross Operating Profit

$

3,869,753

$

4,076,514

$

4,293,612

$

4,521,566

$

4,760,917

$

5,012,235

$

5,276,120

Operating Profit Margin 38% 38% 38% 38% 38% 38% 38%

Net Income

$

(30,574,080)

$

12,696,760

$

2,931,175

$

2,924,038

$

3,264,651

$

3,387,822

$

3,517,153

$

30,227,526

Equity Initial Investments

$

(27,490,428)

Total Investor-level Cash

Flows

$

(26,115,907)

$

9,514,514

$

2,628,462

$

2,577,334

$

2,773,323

$

2,820,498

$

2,875,107

$

22,653,627

Total Developer-level Cash

Flows

$

(1,374,521)

$

3,182,246

$

302,713

$

346,703

$

491,328

$

567,325

$

642,046

$

4,839,503

Project IRR 16%

Investor IRR 13%

Developer IRR 150%

THE END THANK YOU