How do I successfully invest in an EB-5 investment program?

EB-5 investment program

The EB-5 investment program provides a unique opportunity to obtain permanent residency (green card) in the United States through the possession of financial resources that are invested in the country's economy. This visa opens the door for investors and their families, including unmarried spouses and children under the age of 21, to live and work in any state. This method of immigration is considered one of the fastest and easiest, and the likelihood of rejection for program participants is minimal.

Conditions for obtaining a green card

Initially, the participant is issued a “conditional” green card for a period of two years. At the end of this period, immigration authorities verify that the conditions of the program have been met, and if the process is successful, a permanent residence permit is issued. Five years after receiving the first visa, investors can apply for citizenship.

General requirements for participants

To become part of the program, in addition to providing proof of a legitimate source of funds, the investor must meet two basic conditions:

• Create at least ten new jobs for U.S. citizens;
• Invest at least $900,000 in the business if the project is in a high unemployment area (TEA), or $1.8 million in other cases.

Although the investment may be repaid in five to seven years, there are risks involved in participating in the program, and the applicant should consider the lack of guarantees for repayment.

Choice between self-investment and regional centers

Under the program requirements, the investor has the option to choose between investing on their own or working through a regional center (RC). Regional Centers are licensed USCIS facilities that operate throughout the United States, of which there are approximately 700.

Process for working with regional centers

This is where the more exciting part of the process begins. The Regional Center creates a project pool - a list of relevant businesses and locations where money can be invested under the EB-5 program. Investment attraction agreements are signed with the managers of these projects, which helps to secure financing for the implementation of the selected business ideas.

In the standard collaborative process, the business manager needs capital to realize his vision and provides a detailed business plan, while the regional center, in turn, seeks the necessary funds.

Contract signing and document preparation

When a potential investor shows interest in the proposed projects, the regional center signs a contract with him, including all legal aspects. After that, the funds are transferred to a special escrow account and documents are prepared for submission to the immigration authorities.

Conclusion

This makes the process of obtaining a green card through the EB-5 program more organized and secure, allowing investors to invest their money with confidence and ensure legal residency in the United States for both themselves and their loved ones.

The role of the regional center in the immigration process

Once the immigration petition is approved, the Regional Center (RC) becomes actively involved in the implementation of the project until its final completion. The main tasks of the RC are to control the financial flow and meet the set timeframes. It is also responsible for collecting and filing reports and preparing documents for the application for the removal of conditions. In addition, the RA maintains accounting records and creates archival documentation.

Partnership between investors and projects

The regional center, in most cases, acts as an intermediary between investors and projects. It earns money from administrative fees from investors and payments from final recipients, such as developers and builders, who are provided with the necessary financing. Also, the RC is interested in finding and preparing projects with clear and distinct prospects for successful execution, which has a positive impact on its reputation and helps to attract new clients. It also helps to reduce the risks of losses for both the organization and investors.

Criteria for selecting a successful regional center

When selecting a regional center to partner with, it is important to consider several key criteria that can indicate its success. These include:

• Number and approval rate of initial immigration petitions (I-526);
• Successful petitions to remove conditions from green cards (I-829);
• Number and quality of projects implemented;
• Statistics on job creation;
• Regularity and relevance of reports to the immigration service (USCIS);
• Return on investment;
• The nature of the relationship with investors after they receive their green cards.

If an investor decides to leave his funds in the project after receiving a green card and finalizing the investment agreement, this may indicate a high level of trust in all participants in the process.

Reliability check of RC

The reliability and success of regional centers can be additionally assessed by customer feedback, objective indicators and the duration of their activity on the market. On the official website of the Immigration Service, lists of certified RCs are available, which provide annual reports on their achievements and results.

Risks associated with cooperation with RCs

Cooperation with regional centers also entails certain risks. The main ones include:

• Project Bankruptcy;
• Failure to meet deadlines;
• Lack of job creation;
• Business Loss;
• Administrative restrictions by the authorities;
• Various force majeure circumstances.

In addition, given the magnitude of the financial flows, fraud and default can sometimes occur in the process, especially in large construction projects. This can occur when a project lacks the necessary resources, when its implementation is delayed, or when funds are misspent, resulting in an inability to recover the money invested.

Conclusion

Thus, it is necessary to carefully approach the selection of a regional center, conduct an analysis of possible risks and carefully study all the information provided in order to minimize the likelihood of negative consequences for both yourself and the business. The selection of a reliable RC is an important stage that significantly affects the success of the project and the protection of the investor's interests.

In recent years, we have seen a deterioration in attention to aspects of the law related to the registration and management of various entities. This neglect may well affect the interests of founders, who sometimes simply ignore their companies, believing that the immigration service itself will clean up the register by removing inactive entities.

However, it is important to understand that such organizations are subject to strict requirements both in their establishment and in their operation. In most situations, centers are staffed by professional and responsible professionals who work to mitigate both financial and legal risks.

Investment strategies in the EB-5 program

When selecting investment strategies under the EB-5 program, it is important to realize that any project that meets certain criteria is eligible:

• He should be focused on doing business;
• Provide employment for at least ten people;
• Generate a profit or at least provide a return on investment.

The main goal of the program is not to maximize profits, but to be able to obtain a green card.

Ongoing initiative: new school at the start

Location: 829 Father Capodanno Blvd, Staten Island, NY 10305, United States

Construction period: May 2020 - June 2022

The main goal of this project is the active development of the neighborhood. This is achieved through the construction of a new building for a charter school, which is a private educational institution financed from the state budget. It is also worth noting that the project includes reliable management of the created infrastructure after completion of construction works.

Construction is under contract with the primary tenant, who has signed a long-term agreement that allows them to remain at this educational facility for a minimum of 35 years, with the option to continue the partnership for an additional 10 years. The tenant is a non-profit organization that operates a network of private schools in major cities such as New York and Philadelphia. Its goal is to provide a high quality secondary education for students.

It should be emphasized that the building will remain in the ownership of the developer and all costs associated with the operation, including maintenance, taxes and insurance, will be fully borne by the tenant. This is envisaged under the triple net lease scheme, under which the tenant assumes all financial obligations related to maintenance.

The land plot is located in a Targeted Employment Area (TEA), which opens up the possibility of attracting investments in the amount of 900 thousand US dollars. This location is important because it allows potential investors to significantly reduce the cost of participation in the EB-5 program by almost 50% of the required amount.

The total capitalization of the project is $9 million, which creates opportunities to attract several foreign investors. At this point, all necessary permits have been obtained and groundwork is well underway. It is expected that when the school opens its doors in the summer of 2022, its market value will increase to $16 million.

A successfully realized project - a kindergarten in New York City

Completed object: kindergarten

Location: 841 Father Capodanno Blvd, Staten Island, NY 10305, United States

Construction period: August 2016 - May 2018

This three-storey building with an operating roof occupies an area of 1,254 square meters. This facility belongs to the premium class segment and is equipped with everything necessary for comfortable education and recreation of children.

Also, this land parcel is located in a targeted employment zone, which allowed for a minimum investment of $500K. This financial level was in effect until November 21, 2019. The total cost of this project was $4.8 million, of which $725 thousand was used to acquire the land parcel.

Conclusion

In conclusion, the EB-5 program represents a unique opportunity for foreign investors not only to obtain a green card and permanent residence in the United States, but also to contribute to the development of the American economy. I realized that this immigration procedure is one of the most attractive and less risky, especially in light of the guarantee that, if all conditions are met, the investor and his family will be able to settle perfectly in the United States.

Selecting a reliable regional center

However, as we have seen, a key aspect of successful participation in this program is theselecting a reliable regional centerthat helps minimize risks and ensures that the project is executed at the right level. This requires careful analysis of center indicators such as:

• number of petitions approved;
• facts of successful project implementation;
• job creation statistics.

Possible risks

Nevertheless, one should not forget about the possible risks associated with investing. As in any other area of business, the security of an investment can be jeopardized due to various factors such as:

• bankruptcy;
• fraud;
• default;
• force majeure.

Final thoughts

Taking into account all of the above factors, we can say that the EB-5 program opens a wide range of opportunities for those who are ready to take a step into the world of investment and enjoy the benefits of life in the United States. I am convinced that the right approach and conscious actions will help every investor to achieve his or her goal of obtaining American citizenship and new prospects in life.