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How can I buy multiple franchises and qualify for EB-5?

If I buy three running Subway franchises under my name, and one such franchise location can employ three to four employees, will this meet the requirements of direct EB-5? Do I need to structure the three franchises in a certain way or will it do to simply have my name on the purchasing contract?

Answers

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    Daniel A Zeft

    Immigration Attorney
    Answered on

    Your EB-5 investment must create 10 new jobs for U.S. workers. If the jobs already exist, then your investment cannot be the basis for an EB-5 case. Your idea has the potential to be a direct EB-5 case. The definition of a new commercial enterprise includes a holding company and its wholly owned subsidiaries. The structure of entities involved will be critical to whether your idea can become a viable EB-5 case. You need a consultation appointment with an attorney who is knowledgeable about these issues.

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    A Olusanjo Omoniyi

    Immigration Attorney
    Answered on

    You should consider the creation of a holding company which will in turn control the three locations/stores. For further advice, consult a corporate/business attorney on the way forward on your plan. It appears your business idea is feasible.

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    Lynne Feldman

    Immigration Attorney
    Answered on

    You will need to show the investment in the project, plus the creation of 10 new jobs. So it will need a structure to count all three if that is necessary to meet the job requirement.

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    Blake Harrison

    Immigration Attorney
    Answered on

    You could potentially form a holding company with each Subway franchise as a wholly owned subsidiary.

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    Jinhee Wilde

    Immigration Attorney
    Answered on

    In order for you to count all three franchises as one EB-5 investment, you should incorporate a company (LLC would be preferrable) that owns and operates all three shops with you as the owner/president of the company. Also, as all three shops may not be located in the targeted employment area, make sure that your investment is $1 million total.

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    Vaughan de Kirby

    Immigration Attorney
    Answered on

    Three franchises can be owned by a single entity and qualify for EB-5 as a new commercial enterprise. The difficulty with your plan is the fact the franchises are existing. Under EB-5 you must create a new commercial enterprise. I recommend you consult with a qualified investment immigration attorney.

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    Robert West

    Immigration Attorney
    Answered on

    Subway, probably not. Subways are not that profitable. McDonald's yes. Meets income and other EB-5 requirements.

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    Belma Chinchoy

    Immigration Attorney
    Answered on

    As these are currently operating enterprises, they will not qualify under standard EB-5 job creation rules, unless they are troubled businesses. Either way, you need to structure this in a particular way.

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    Robin J Gray

    Immigration Attorney
    Answered on

    As long as all three franchise locations are part of the same holding company, and you meet the investment and job-creation requirements, such an investment should work for the EB-5 program. This is true whether or not is it a direct investment or regional center. You should contact an experienced immigration attorney to review all of your options and help you make the best decision on how to structure the investment to meet the EB-5 requirements.

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    BoBi Ahn

    Immigration Attorney
    Answered on

    It is doable if carefully structured. You will need to create an entity which owns/operates all three franchises, and employment and investment must be made to that entity, etc.

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    Charles Foster

    Immigration Attorney
    Answered on

    If you start off by buying a new Subway franchise and it creates three or four employees, you would have to operate several franchises under the name of a single company showing that you are operating several franchises that together create 10 new jobs for U.S. workers. In order to qualify for the $500,000, your enterprise must be located in a targeted economic area (TEA); having multiple franchises complicates the question. However, if all of your franchises are located in TEAs, then that should not be an issue. In terms of the structure it would be preferable that you either buy all three directly in your name or buy them through a corporate entity which you own 100 percent.

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