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How is an EB-5 investment distributed in projects?

I am asking this question from a company located on Oklahoma State University’s campus and we are very interested in the EB-5 program. We provide a lot of financing for university research-based start-ups and are taking a look at the EB-5 program as a potential source. In order to better inform our board of directors about the program, we are searching for some information on the breakdown of the total investment into the United States from the program. For example, what percentage of the funds goes to strictly just project financing, “bricks and mortar” projects so to speak? How much of the funds actually go to start-up companies, or what percentage of the funds are used to actually start a company? I have been searching for this information and was wondering if you had any insight on the topic, or maybe could point me in the right direction as to where I could find it?

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    Reza Rahbaran

    Immigration Attorney
    Answered on

    An experienced EB-5 immigration attorney will provide you with a better understanding of the EB-5 visa program and determine if the project is EB-5 compliant. There are differences when investing directly or through a regional center. In a direct investment, the location of your business will dictate the amount of capital required. The investment must then create 10 direct, full-time jobs within two years. If done through a regional center, indirect and induced jobs may be used towards the job creation requirement. Your business plan should show where the funds are to be invested; however, the principal of the project may deploy funds where necessary.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    USCIS does not publish these kinds of statistics and it is uncertain whether a FOIA request would yield the information you are looking for. There is other information available, such as filings and approvals of I-526 and I-829 petitions and other data published on the USCIS website about the location of each regional center. Perhaps you could ask your senator or congressional representative if they can get information for you.

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    Rohit Kapuria

    Immigration Attorney
    Answered on

    It appears that you have quite a few detailed and intriguing questions. I would be happy to offer you a complimentary consultation to further discuss. However, in general, keep in mind that the premise of the EB-5 program is job creation. For every investor that makes a $500k or $1m investment (depending on whether the project''s location qualifies as a TEA or not), one must be able to demonstrate 10 jobs. In a direct EB-5 project, you would need to demonstrate that these are W-2 employees. If done under the auspices of a regional center, then you can count indirect and induced jobs (and sometimes even direct jobs if the project will involve construction lasting greater than 2 years). Furthermore, depending on the size of the project, EB-5 usually makes up one line in the capital stack (which is usually composed of equity, bank financing, sometimes TIF grants, etc.) or it can even take out a bridge. Generally, EB-5 will be subordinate to other 3rd party financing. The overall job impact would be calculated using the qualifying capital expenditures. Land purchase is permissive but funds allocated from the capital stack for such a purchase cannot be used for the job creation count. There is no standard in the EB-5 context, rather, it is what would be most marketable to the investor. If you plan on using EB-5 to cover 100% of the project cost, most investors would not be interested. It is crucial to have some skin in the game. I invite you to review the many resources (articles, blogs, links, etc.) available on my firm?s website.

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    Ed Beshara

    Immigration Attorney
    Answered on

    It is highly recommended that you retain the services experienced EB-5 attorney to assist you in the learning process of how to structure and EB-5 project and obtain the required amount of funds to expand U.S. operations. The U.S. immigration attorney will first determine the legal and financial infrastructure you wish to establish and on the basis of your capital investment requirement. In addition, we will need to review with you the marketability of your project to obtain the investment funds as a ways and means to expand your U.S.operation.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    We believe the right direction involves retaining qualified EB-5 counsel, like our law firm, to assist you with the legal and financial infrastructures necessary for an approvable EB-5 investment project. As the principal of the project, you could control exactly where the investments from foreign national investors will be used. Actually, a breakdown is expected uses of funds will be required! I hope this answers your question and our law firm would be more than happy to discuss this with you further.

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