What is an EB-5 Capital ?

EB-5 capital funding has become an alternative source for raising capital as opposed to traditional sources such as banks. Congress created the EB-5 program in an effort to spur the economy and create jobs through foreign investment. This allowed for foreign investors to invest in the United States and in exchange the investors would receive a green card, eventually becoming citizens. In the wake of the financial crises, American businesses and developers have tapped the EB-5 program to raise capital for their projects.

 
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EB-5 visa Background

In the early 1990’s, Congress created the EB-5 program to help stimulate the economy by bringing foreign capital and creating jobs. The EB-5 program requires that a foreign investor invest a minimum of $500,000 or $1 million, depending on the location of the project, in a commercial enterprise located within the United States. Each investment made must create 10 U.S. jobs. If the EB-5 investor chooses to invest the minimum investment of $500,000, then the EB-5 investment project must be in a targeted employment area. If the EB-5 investor chooses to invest $1 million, then the EB-5 investment project does not have to be a targeted employment area and can be anywhere in the United States.

Congress later expanded the program by creating the Immigrant Investor Pilot Program, establishing the EB-5 Regional Centers. EB-5 Regional Centers receive their designation from USCIS and Regional Centers pool EB-5 Capital, which is used for investments in projects that require large amounts of capital. A key benefit for investing in a Regional Centers is that the job creation requirement is not as strict as a Direct Investment. The investor is allowed to count direct and indirect jobs that are created towards the job creation requirement. For example, if a project was a hotel development that was surrounded by restaurants or other small businesses and if those restaurants and businesses have to hire more workers because of the hotel project, then those jobs would count towards the job requirement. This allows for multiple EB-5 investors to invest in the same project and still meet the job creation requirement to obtain an EB-5 green card.

 

What is eb-5 capital?

EB-5 capital funding has become an alternative source for raising capital as opposed to traditional sources such as banks. Congress created the EB-5 program in an effort to spur the economy and create jobs through foreign investment. This allowed for foreign investors to invest in the United States and in exchange the investors would receive a green card, eventually becoming citizens. In the wake of the financial crises, American businesses and developers have tapped the EB-5 program to raise capital for their projects.

 
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How to obtain a Regional Center Designation?

A developer that is seeking EB-5 capital can seek a Regional Center designation from USCIS. Seeking a designation requires the applicant to file an I-924 petition for Regional Center Designation as well as a host of supplemental information such as geographic and industrial scope of the regional center, economic impact and job creation prospects that will be created by the projects. This is a lengthy process and its best if an immigration lawyer is retained to facilitate the process.

 

Working with an existing Regional Centers for EB-5 Investment

Developers, however, can work with existing Regional Centers to raise funds in the immediate future. Many Regional Centers will work with outside developers on their projects by providing EB-5 capital funding.  

 

Direct Investment for EB-5

Some EB-5 investors, the entrepreneurial investors, prefer to make a direct investment that they can run on a day to day basis. The EB-5 investor would not need to file for a Regional Center designation with USCIS but will have other obstacles such as the direct job requirement. The EB-5 investor will need to make an investment of $500,000 in a targeted employment area or $1 million, anywhere in the United States. The EB-5 immigrant investor program has proven to be a great alternative option for developers to raise EB-5 capital for their projects. The EB-5 visa program will continue to be the hallmark of U.S. investment-based immigration and the number of immigrant investor petitions (I-526) has been growing year after year. EB-5 investment projects have created thousands of jobs since the EB-5 visa program was founded and continues to create jobs.