Can Investors Receive a Property Interest in an EB-5 Investment? -

Can Investors Receive a Property Interest in an EB-5 Investment?

Kate Kalmykov


A popular fallacy among individuals interested in making EB-5 investments is thinking they will receive an ownership interest in tangible physical property in consideration for their investment. However, this could not be further from the truth.


One of the cornerstones of the EB-5 program is the statutory requirement that an investment in the EB-5 program must be “at risk” for the purposes of generating a return. 8 C.F.R. § 204.6(e). Evidence of mere intent to invest, or no present commitment of capital, is not sufficient to demonstrate that the investor is actively in the process of investing. In Matter of Izummi, for capital to be “at risk” there must be a risk of loss and a chance for gain. Matter of Izummi, 22 I&N Dec. 183-188 (Assoc. Comm’r 1998).


This specifically rules out situations where an investor would receive an ownership or use of a particulate asset in return for their EB-5 investment. This principle was enunciated in Matter of Izummi and in the May 30th EB-5 Policy Memorandum. If an investor is guaranteed the right to ownership or use of an asset then the present value of that guarantee does not count towards the total amount of the investor’s capital contribution when U.S. Citizenship & Immigration Services (“USCIS”) determines how much money was truly placed at risk.


Therefore, an investor investing in an EB-5 investment may not receive any right to ownership or use of a home, condominium, commercial space or any other real estate interest. Additionally, these rules also prohibit an investor receiving an item of personal property in return for their investment, regardless of how small the value of that personal property item is.

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