EB-5 Visa Blog

What Type of Project Am I?

Kate Kalmykov

By: Kate Kalymkov

Regional centers seeking designation must make sure to present a solid application to the USCIS to avoid delays. In particular, regional centers must understand the difference—and importance—between the types of projects that can be submitted with the I-924 application. Specifically, what is the different between a “hypothetical,” “exemplar,” and “actual” project in the context of an I-924 application? The distinction can be somewhat hazy.  Knowing what these terms mean can make a significant impact on the amount and types of documents needed in the regional center application and the adjudication standard applied to it.

A hypothetical project is a project included in an I-924 application that is not “shovel ready”.  A hypothetical project is just that – a project that may or may not come to fruition.  USCIS will grant regional center designation when “general predictions” are made showing the job creation that will result from the hypothetical project’s business plan.  Hypothetical projects contain the minimum of required information.  This option is used by Regional Centers when they know they will develop a certain type of project in a certain geographic area in the future (for example, construction and operation of a hotel in Manhattan), but not all of the plans are finalized yet.  Perhaps the hotel flag may change or the project may change neighborhoods in Manhattan.  With this option, the Regional Center must submit a business plan and economic report to support the project, but many of the other ancillary documents, such as the offering, detailed feasibility studies, and permits, would not be required.

A second type of application is one based on an actual project, or a “shovel ready” project.  An “actual” application includes, among other things, a specific business plan and economic analysis, the actual capital-investment structures (the offering and ancillary securities and corporate documents), evidence of the other funding committed to the capital stack, feasibility studies, permits, licenses, and other documents to support the shovel-ready nature of the project. In other words, an “actual” project means that this project is moving forward once the Regional Center can accept EB-5 funds and investors can file I-526 petitions.  The actual project, however, is not being “pre-approved” by USCIS, and therefore small changes can be made to the business plan, the economic report, and the offering documents as needed before investors file I-526 petitions.

An “exemplar” I-526 petition is a “sample” I-526 petition for an unnamed investor included with the I-924 application.  Of all 3 types of projects discussed here, this type of project requires the most documentation.  With an “exemplar” I-526 petition, the Regional Center prepares a full I-526 petition, including all project related documents, for a sample investor.  USCIS then “pre-approves” the project materials.  Theoretically, when the I-924 application is approved and the investors can file I-526 petitions, the only documentation that requires review by USCIS is the investor’s source of funds.  While this doesn’t always happen and USCIS sometimes does re-review the project materials, it gives the Regional Center a distinct marketing advantage to tell investors their project has been “pre-approved” by USCIS.  Changes to any documents destroy the exemplar status, unfortunately, so the documents need to be static.

The takeaway is to select an option that fits the development timeline of the project.  A project that is not fully developed should be filed as a hypothetical project.  A project that may need a change in location, size, or scope should be filed as a hypothetical project.  Projects further along the development timeline and that have required permit approvals and feasibility studies should be filed as actual projects.  And finally if the Regional Center would like a marketing advantage on an actual project, it should be filed as an “exemplar” I-526 petition project. 


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