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How can an investor invest in two companies and qualify for EB-5?

I want to open a restaurant with a U.S. friend who will invest with me. We will purchase the land for the restaurant with part of my $500,000 in funds, as well as his. A corporate attorney has told me I need to form one company for the property and another for the business so I am protected. If I cannot invest in two companies since jobs will not result from the property business, can my restaurant company with all the money make a loan to the second company to buy the land? Or can I invest in two companies and still get my EB-5 visa?

Answers

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    An EB-5 investor must invest into a single new commercial enterprise (NCE). The definition of an NCE includes any wholly-owned subsidiaries, so if the relationship between the two companies recommended by your corporate attorney is one that includes a wholly-owned subsidiary, then the investment and resulting job creation in the NCE will count toward meeting the EB-5 requirements. That is, your main company may make a loan to the second company as long as the second company is a wholly-owned subsidiary.

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    Ed Beshara

    Immigration Attorney
    Answered on

    An experienced EB-5 immigration attorney will be able to advise you. Basically, in a direct EB-5 project you can invest in a holding company which 100 percent owns a subsidiary company where the jobs are located.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    First, USCIS may not count jobs created as a result of a land purchase. Second, USCIS has allowed "portfolios" of projects. This may require the investment into one new commercial enterprise entity using the EB-5 funds to make an investment into two or more portfolio companies (job creating entities). With such a complex structure, you need the assistance of an EB-5 immigration attorney.

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    John J Downey

    Immigration Attorney
    Answered on

    First, the purchase of land does not count as part of the investment. So your $500,000 will need to be invested in the job creating enterprise. If it makes business sense to have the restaurant company purchase the land then O.K., but it is not part of your investment for EB-5 purposes.

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    Robert Cornish

    Securities Attorney
    Answered on

    Have a holding company own both separate entities as parent/subsidiary and invest in that. What you describe does not sound like an EB-5 investment in a TEA. Make sure you have immigration counsel to guide you.

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    Jinhee Wilde

    Immigration Attorney
    Answered on

    The requirements of EB-5 dictate that all of your EB-5 investment be made to a job creating new enterprise and that such funds be used by that entity to create 10+ full-time and permanent jobs. Thus, I suggest you work with a corporate attorney and/or EB-5 attorney team who understand the EB-5 requirements and could help you with structuring the business to be EB-5 compliant before filing your EB-5 immigration case. EB5 Investors Magazine has a list of Top EB-5 attorneys on the corporate and securities compliance side.

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