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March 5th, 2010 |
 This is an area that can be overlooked when looking into the various EB-5 investor visa regional center program options. Many ask what it means.
In summary, regional center programs vary considerably both in size and popularity. Some Centers have programs only requiring a few investors, some, such as a proposed car plant, will require hundreds even thousands of investors.
Some centers have an established track record and it is possible to determine how long it is likely to take for the program to be fully subscribed; with others there is very little evidence to go on.
However, the questions that need to be asked are:
• What happens if a program does not fully subscribe, can it then go ahead?
• If not, what happens to job creation?
• Will you ever get your money back?
These are clearly very important issues particularly in the current economic climate and ones that seem all too often to be receiving less than adequate attention.
Ask us what this means to the safety of your regional center choice. Contact the experts at Which EB5 for information on regional centers.
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Tags: application, eb-5, eb5, investor visa, job creation, money back, regional center, track record, visa
Posted in Immigration | No Comments » |
February 4th, 2010 |
 Job creation in the EB-5 Visa Program This is particularly important at the I-829 stage when conditions are removed, assuming of course that the $500,000 principal has been utilized as required, and the 10 jobs required have been created.
All too often this is an area where not enough attention is given, and in many cases evidence of jobs created will be required. In certain cases a delay or problem with a program could jeopardize the creation of these all important jobs.
However, there is an interesting alternative that is operated by a very small number of regional centers. USCIS recently indicated they are accepting the use of economic models based on infusion of capital. If such a model is used to calculate job projections at the I-526 stage, an investor could receive credit for job creation at the I-829 stage by establishing that the regional center utilized the requisite amount of capital into the new commercial enterprise, and that the new commercial enterprise spent that capital. All this could be done without specific direct data about actual job creation.
“If the infusion of capital occurs according to the approved business plan and economic analysis, and the capital investment scheme comes to fruition in the manner outlined in the business plan, then the economic data provided in support of the Form I-526 petition regarding indirect job creation may demonstrate the creation of the indirect jobs without the submission of further detailed data about job creation at the Form I-829 petition stage”.
Contact Which EB5 for more information on job creation methods and the effect upon your EB-5 visa success.
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Tags: eb5, I-526, I-829, job creation, regional center, uscis, visa
Posted in Immigration | No Comments » |
October 30th, 2009 |
These type of programs focus on your $500,000 investment (in an approved regional center program) being used as part of a fixed term loan to a company, business or economic development agency, rather than being used as a direct investment in a specific building, resort or enterprise.
This type of program is becoming increasingly popular as many potential EB-5 visa investors are focusing on three issues:-
• Obtaining their green cards in a timely manner
• Having conditions removed after two years
• Maximizing the likelihood of the return of their $500,000
Effectively, rather than investing in programs such as commercial real estate, resorts and mixed fund investments which may not have a clear specific and dated exit strategy, an alternative is to invest in a regional center program which loans the funds to an infrastructure development project, such as developing roads, sewerage systems etc. The loan has a specific time period usually five or six years.
Such programs may have several advantages namely:-
• The exit strategy is clear and a defined end to your investment is indicated
• The projects may be with quasi public sector agencies, which in the current economic climate may be seen by some clients as a viable alternative to private companies.
• Some well structured programs use an advantageous job creation model - in effect this may reduce the worries posed by other models
However there are very few proven center currently operating this program, if you would like further details please contact Which EB-5 at: info@whicheb5.com
The EB-5 Investor Green Card regional center visa program is an excellent way to quickly become a permanent resident of the United States. Which EB5 researches regional centers; you make the same investment plus get all the independent advice of Which EB-5 at no cost to you.
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Tags: commercial real estate, eb-5, economic climate, economic development agency, exit stratergy, green card, independent advice, infrastructure, investor green card, investors, job creation, mixed fund investment, quasi public, regional center, resorts, specific time, visa, Which EB-5
Posted in Immigration | No Comments » |
May 21st, 2009 |
This is one of the primary questions to be explored as you and your advisor undertake your due diligence in evaluating the safety of your investment and the potential of a regional center. If the original project hits one or more roadblocks, does the center have a plan to maintain the program? Can it still produce that all-important job creation element?
There are many reasons why a project may not proceed according to the original plan. It is very difficult to presume all the potentials that can happen, but a good third-party advisor will know what to look for, and what to look for in a fall-back plan. To give you an idea, suppose that the project that you have chosen is underfunded—that it fails to recruit the number of investors that were originally planned for, and so the whole project cannot proceed. What happens then?
In this instance, your advisor will be looking to see if the regional center has a plan to pursue other funding sources, such as commercial lending. This would enable the center to utilize your investment capital and also to secure the necessary additional funding to complete the project so that its qualification status can be maintained. These kinds of safety-nets are even more reasons to thoroughly evaluate the center and its project. You need assurances that the center/project has the means to secure outside funding in the event that it is needed—that a commercial lender or other investment mechanism would find the center to be a good investment risk. This is also an example of why you need someone to dig really deep and find out who potential fund recipients will be, so that it can be determined how likely your investment is to be repaid, and to determine how fit those entities are as “collateral” for the project.
Additionally, if other sources of funding are to be secured, you need to know that your project will still continue to qualify as a basis for EB-5 immigration. This is where things really start to get complex again, and where a solid team of professionals and consultants to back you and guide you prove invaluable. At this point, not only are you talking about the numbers of the investment, but the legalities of investment law and visa approval; it takes a great deal of experience and knowledge in all the applicable arenas to lend the amount of confidence you need to such an undertaking.
As we said, this is only one example of the variables affecting the security of your EB-5 investment. There are many others that a third-party consultant can help you deal with. Expect your advisor to speak frankly with you and perform this deep level of due diligence so that you can determine the safety of your investment in all respects to the extent that is prudent and reasonable.
Next we will look at: What happens to your money once invested in an EB-5 Regional Center? In the meantime, if we can answer any of your questions please contact Stephen Parnell or Andrew Bartlett at Which EB5
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Tags: andrew bartlett, commercial lending, eb-5, Immigration, job creation, regional center, stephen parnell, visa, Which EB-5
Posted in Immigration | No Comments » |
May 20th, 2009 |
Any investor will always have concerns over the safety of their investment. When that investment is the key to your chosen future, however, safety becomes a very subjective term. In the case of EB-5 investment, safety takes on a very unique life of its own, and often leads to investors going to extremes rather than considering the best balance between investment safety and immigration qualification.
Not uncommonly, and really not surprisingly, people who are looking to immigrate through the EB-5 will do one of two things; they either
• Focus intently on the investment potential at the expense of attending to the visa implications of the project, often assuming that the one will take care of the other, or they
• Focus intently on the visa implications without attending to the business end of their investment.
At least on the surface there are fairly obvious repercussions of either practice. Potentially, you could end up with a great return on investment and never gain visa approval, collecting on your investment while still living in your home country, or you could gain that visa approval and be here in the States and see almost no return on your investment. Even these are not the worst things that could happen, though. It is just as possible that, without the right level of thorough due diligence, you could lose all your invested monies and not qualify for a visa because the project failed when there were no jobs created. We’ve already discussed the possibility that a poorly planned and executed investment could gain you conditional status, but not full green card status. Having your green card revoked at the two-year mark is a very real possibility, too, if that job creation component cannot be solidified.
When you are talking in terms of investment safety with the EB-5 program, you have to consider it from different angles. One angle is the amount of risk that the investment itself carries—that is why your advisor will go through the proposed business plan thoroughly, as well as all claims and documentation to make sure everything makes good business sense. The safety of your EB-5 investment is something that needs to be handled carefully, and with a perspective of balance. On the one hand, there is no 100% safe investment, because all investments must carry some risk in order to qualify for visa approval. On the other hand, that is not a reason to choose a risky investment project—the CIS expects a reasonable amount of risk, and a reasonable amount of safety as well.
Determining investment safety and risk goes beyond the business or investment plan, though. It also requires due diligence in terms of how prospective fund recipients will be chosen, and/or who those fund recipients are (if already known). This will give an indication as to the likelihood of loans and investments being paid back or their seeing a return.
The other angle that needs addressing when considering safety and choosing an EB-5 regional center investment is the safety of your money as an immigration vehicle. You need to know that a successful project will be a qualifying EB-5 project—one that has what it takes to be approved by CIS as a green card condition. It’s not enough for an investment to produce a return on your money, it must also meet the stringent requirements laid out by CIS.
Part and parcel to determining how safe your investment is, and how likely it is to gain you approval at both the I-526 petitioning stage and the I-829 stage, is knowing not only what happens according to plan, but also knowing what happens if things do not go accordingly. When the unexpected happens, does the center have a plan for dealing with it? Is there a solution that will preserve your immigration or petition status? You need a way of determining whether or not such a plan is in place, and whether that plan is reasonably viable as well. Again, that means more due diligence, and a lot of in-depth research.
Next we will look at: Should a regional center have a fallback plan? In the meantime, if we can answer any of your questions please contact Stephen Parnell or Andrew Bartlett at Which EB5
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Tags: andrew bartlett, eb-5, green card, I-526, I-829, investment, job creation, regional center, safety, stephen parnell, visa approval, Which EB-5
Posted in Immigration | No Comments » |
May 18th, 2009 |
Immigrating through an EB-5 investment hinges heavily on the job creation of the regional center. Without creating jobs, there is no way a project will result in an approved green card application. Economic stimulation through job creation is the express mission of the EB-5 and the regional center pilot program. What’s more, the approval of your green card application is not all that is riding on the center’s job creation methodology—the removal of conditions on the green card (which happens after two years) and your full permanent immigration status also relies on it.
The ability of the center to actually come through on their job creation forecasts is integral to achieving full permanent residence in the U.S. At the completion of the two-year conditional visa period, the number one factor that the USCIS will be looking to see proven is the implementation of the center’s business plan and the actual—not proposed or forecasted—creation of at least ten jobs which can be directly attributed to your $500,000 (or 1 million if that is the case) investment.
To say the very least, the job creation methodology of the regional centers you are considering is crucial; therefore, your advisor will be focusing in heavily on evaluating their methodology, specifically looking to see that the jobs created, either indirectly or directly, can be solidly accounted and their projections reproduced. In addition, your advisor will dig deeper to try to determine what else backs up the center’s original plan. As he or she does this, he will put the center’s plan to the test, asking questions such as:
• How did the center arrive at its calculations for job creation?
• What documentation and analysis supports the number put forth by the regional center?
• Do these numbers make sense?
• How will job creation be monitored as the project progresses?
• Is there a plan to remedy the situation if job creation is not proceeding as planned?—In other words, a plan to make up for your lost, but still required, ten jobs?
Along with determining the number of jobs created, you need to know just what that job creation looks like. You need to know what types of jobs are being counted toward the requisite number. You need to know if those jobs are positions that are directly created and attributable to your investment money, or if they are projected jobs that will be induced or indirectly created by extension of the business plan and project funds.
Certainly the great advantage of the EB-5 regional center program is that indirect job creation is accepted by the USCIS. This means that you need to be sure of the center’s job creation methodology, and to do that you will most certainly want the added security of having a professional researching that and double-checking the information that is used to produce the number and the conclusion that has been arrived at. He or she will look to see that not only does the center have a plan for creating jobs, but that at minimum ten of those positions will fulfill the requirements of being full-time positions (remembering that part-time positions do not qualify), and that those positions are solely attributable to your investment money, as there is no overlap or “sharing” of job creation allowed between investors.
To give you some idea of how complex an undertaking proving job creation is, here are some of the different ways that regional centers and the USCIS go about proving that your investment will result in jobs being created.
As we know, the limited liability company or limited partnership (the regional center project) that you invest in does not have to directly hire anyone. Instead, the center’s plan may be to arrange for the businesses and loan recipients who borrow or obtain the funds to produce the jobs by directly creating positions and filing them through direct hires (in other words, the person or entity who receives the money hires, ten workers).
Another common scenario in the case of real estate-based projects is that the businesses who rent the developed space will directly hire a set amount of people into full-time positions they have created. To determine qualification of the jobs created, the CIS will “plug” these numbers into an econometric model. That model will have certain multipliers based on each specific industry. To be successful, the model should return at least ten new jobs created based on that model per each investor. These must be new jobs, and cannot be comprised of transferred positions that are simply relocated into the regional center’s geographical area.
Another possibility is that the regional center project had its job-creation model approved based on a specific number of jobs being created for a certain amount of investment money. For example, the partnership (regional center) may lend money to a private company or a government agency who in turn agrees to invest a specified amount of money. These figures are again “plugged into” an econometric model that projects the numbers of jobs created for certain levels of investment, and for certain amounts of money spent by the borrower. When this is the case, the project must be able to illustrate the model, and also prove that the borrower has spent that requisite amount of money to have resulted in the creation of at least ten new jobs.
Job creation analysis is a highly complex undertaking. Some centers are partnered with Universities and leading economists for the projection and calculation of job creation. That is not to say that you can trust in a job creation claim from a regional center just because they have a big name University or professional on their list, but just to show that this is no simple matter, and that it is one that requires thorough analysis by an experienced professional. A good advisor will have the experience working with centers, their plans and projects, and the economic tools that indicate the reliability of a regional center’s job creation projections.
Too often the viability of a project’s job creation methodology is taken for granted by investors who are given only the rosiest of projections by EB-5 centers. But with everything riding on this one factor, there is no room for that kind of error. You must be as sure as you can be that the jobs created in your name will be there when the time comes to prove them.
Next we will look at Location considerations of regional centers. In the meantime, if we can answer any of your questions please contact Stephen Parnell or Andrew Bartlett at Which EB5
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Tags: eb-5, econometric model, green card, Immigration, investment, investors, job creation, permanent residence, regional center, regional center pilot program, removal of conditions, uscis, visa, Which EB-5
Posted in Immigration | No Comments » |
April 9th, 2009 |
Yesterday we looked at some important questions you need answers to when considering which regional center you choose for your EB-5 visa. Today we’ll take a look at one of those considerations; job creation.
Why is the job creation element of a regional center investment so important? Quite simply because without the requisite number of jobs being created by your investment, your green card could possibly be of a very temporary nature.
Looking at job creation by a regional center consider, in part, the following:
“Show, using reasonable methodologies, that 10 or more jobs are actually created either directly or indirectly by the new commercial enterprise through revenues generated from increased exports, improved regional productivity, job creation, or increased domestic capital investment resulting from the pilot program. The requirement of creating at least 10 new full-time jobs may be satisfied by showing that, as a result of the investment and the activities of the new enterprise, at least 10 jobs will be created indirectly through an employment creation multiplier effect. To show that 10 or more jobs are actually created indirectly by the business, reasonable methodologies may be used, such as multiplier tables, feasibility studies, analyses of foreign and domestic markets for the goods or services to be exported, and other economically or statistically valid forecasting tools which support the likelihood that the business will result in increased employment”.
When evaluating which EB-5 you are going to choose it is very important that you have an understanding of how the 10 jobs required to be generated by your investment are going to be created; are they all direct jobs? i.e. will the new enterprise you invest in employ 10 people by utilizing your investment? Alternatively, will the regional center you choose be able to show by “reasonable methodologies” that your investment has created 10 “indirect jobs”?
Your understanding of the job creation element of the regional center investment is perhaps the first and foremost of your considerations in choosing which regional center you will invest in.
Tomorrow we will take a look at exit strategy; how you get your investment back. Until then, if you have any questions or comments please do not hesitate to let us know.
Andrew Bartlett & Stephen Parnell
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Tags: andrew bartlett, direct jobs, eb-5, green card, indirect jobs, investment, job creation, regional center, stephen parnell, visa
Posted in Immigration | No Comments » |
April 8th, 2009 |
Over the last week I have been traveling America continuing my quest to meet with representatives and/or attorneys representing regional centers. I am digesting the content of my notes from this trip and will be looking for points that affect our client’s choice of EB-5 Regional Center. We will feature many of these observations here on our Which EB-5 blog in the coming weeks.
Some of my early observations still come back to the same important questions:
1. How safe is the job creation methodology, will my Green Card become permanent?
2. What is the exit strategy – How will I get my investment back and when?
3. What are the implications of a regional center requiring the client to use a designated attorney and does that create a conflict of interest?
4. How do relatively new regional centers compare to those with a track record?
5. Does the geographic location of a regional center have an impact on the client’s choice of where to invest? Should it?
6. With so many new EB-5 regional center choices becoming available, what is the best way for a potential immigrant investor to choose where to invest, who to trust?
As we progress through 2009 our clients around the world will undoubtedly be bombarded with creative advertising offering all sorts of exotic camera shots of fantastic looking destinations all in an effort to promote any one particular regional center. Don’t let that glamour cloud your judgment. Forget the sales spiel; focus on the cold hard facts, some of which may be a little cloudy!
Despite what you might be told by employees or representatives of regional centers I have one sage piece of advice: Don’t be hasty! Even if you are told that spaces are limited, or time is running out (both of these statements may be perfectly true). Make sure you are entirely happy with your decision before you sign agreements or part with your funds. A very wise and wealthy friend once said to me “If it’s a good deal today, it will be a good deal tomorrow”.
Keep watching this space for updates. Contact me directly for a chat or with questions if you want help with your EB-5 visa choices.
Stephen Parnell
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Tags: America, conflict of interest, designated attorney, eb-5, green card, immigrant investor, job creation, regional centers, stephen parnell, where to invest, Which EB-5
Posted in Immigration | No Comments » |
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